FFS080 - Bitcoin Mechanic

[00:00:00]

Intro

Mechanic: when you look into how mining really works at the moment anyway, there's so much nonsense going on that you start to think, wait. If there's only one other option, if I talk to you about the nonsense, and I tell you there's an alternative called Ocean, and you switch there, by the way, it's not much of a coincidence, and it's not too much of a stretch of the imagination for you to realize, that is the one pool also that has an anti spam mechanism in it.

None of the other ones do, and the other ones all engage in this nonsense I'm talking about that you're probably going to want to get away from every reason, including profitability

Luke: Welcome back to the Freedom Footprint show, the Bitcoin philosophy show with Knut Svanholm and me, Luke the Pseudo Finn. And we're here today with Bitcoin Mechanic, who's here today to talk all about the new Bitcoin mining pool, Ocean, which we're really excited about and everything that's going on today with spam on the blockchain and what Ocean might be doing to mitigate that.

So Bitcoin Mechanic, welcome to the Freedom Footprint show.

Mechanic: Hi, how are you guys doing?

Knut: [00:01:00] and good to see you again, Mr. Mechanic. It's been a while, uh, and congratulations on your new position and, uh, congratulations on the fantastic launch and your fourth block and everything, even though it was empty, uh, uh, yeah.

Mechanic: output in it, that's enough, that's

Knut: All right, yeah. Yeah, but congratulations on everything Ocean related.

So, um, yeah, we've been trying for a couple of episodes now to, you know, light on what's going on with Ocean and with this spam that's clogging up the time chain and stuff like that.

Miner Competition Incentives

Knut: So, I'd like to start from a, um A more philosophical angle, maybe. so, there's this notion about, you know, Bitcoin moving the shelling point of profitability of violence or something like that, so when you cannot know how much another person owns because they can have the private keys in their [00:02:00] heads, you can't really shoot them and take their stuff because the stuff is in their heads, so Bitcoin is in their heads.

Incentivizing people to be more peaceful towards one another because violence is less profitable than it used to be before Bitcoin was a thing. However, I had a conversation with a couple of miners in Stuttgart about this that made the point that This is not necessarily true for miners. Miners may still have an incentive to be aggressive towards one another.

So if you imagine, uh,

competing miners may still have an incentive to nuke one another and destroy the competitor's hashing power. Is this how you see it? Is this something you'd agree to, this picture of, this framing?

Mechanic: You mean like in a physical sabotage capacity, like, you know, go over to the guy's warehouse and, you know, pump in a bunch of hot air so that they [00:03:00] all overheat and damage themselves or just straight up blow it up? I

Knut: Yeah, I mean physical damage,

Mechanic: yeah, I mean, in theory, sure. But I mean, in my experience, none of them have done that. But that's just how Bitcoin works in the early days, right? Like, Hodl Tarantula tweeted about this a little while ago saying, like, logically, every time someone messages me asking for help setting up their mining farm, I should not help them because, you know, they're competition.

But You'll never see me do that in a million years. All I want to do is help them get set up and like, teach them all the things I've learned over the years, but that's, you know, that's, humans like helping each other, and it's one of these things that defies those sorts of people that have this, uh, you know, mantra that An action will be economically rational, and that's it.

No one will ever do anything else, you know, uh, that isn't motivated by this. And I'm like, well, people just help each other for, you know, you can call up a guy with the wrong phone number and he'll try and help you out for ages. And any appeal to like, [00:04:00] Well, there's some sort of way in which he can benefit from that if, you know, you do him a favor, maybe he does you a favor one day, and I'm like, no, this is a guy you bumped into an airport and you picked up the thing that fell on the floor, you just wanted to help him, like, you know, you'll never see the guy again.

So people like helping each other, right? Um, so you've got that. I'm not saying Bitcoin will remain like that forever, though. I think industrial espionage particularly of like massive bitmain facilities. I wouldn't put it past them to be like, you know, get a worker inside a micro BT factory and start sabotaging devices and stuff like that.

On, on that scale, it starts to get pretty nasty. But,

Knut: Th this is sort of why I ask the question be because, um, I also believe that most people want to help one another, and especially Bitcoiners who, who know a bit about Austrian economics and know that profit is not just monetary profit or economic profit, like profit can be in terms of you feeling better about yourself or you making a more long-term move.

[00:05:00] and you know, miners. Being at least the first generation of miners probably have this low time preference thing going. so, but when we move to like, and some would argue we're already there, you know, with industrial mining and, and, uh, all of a sudden you have all these bad actors to see a short term profits, some, some way of, of, Being malicious and therefore, making a big short term profit and therefore they're a threat.

And so, so is this an increasing threat as, as mining grows bigger as an industry? What, what would you say?

Mechanic: I think it's more to do with mining having less and less to do with Bitcoin. Uh, and this is a point I've been making for a while, which is, um, you know, Bitcoin mining as Satoshi described it. It requires a whole bunch of processes and infrastructure that, uh, of which hashing is one part [00:06:00] of it. And increasingly, when we talk about Bitcoin miners, we talk about hashes, and we discard the rest of it and just leave that up to a tiny group of pools, and that's not good.

Um, because it's just perpetuating a myth. If you have a bitcoin mining device, it's just hashing and doing the work given to it by a centralized coordinator, which has problems and ramifications, and I see errors in this all the time. Uh, in the general discourse around Bitcoin, when people talk about soft fork upgrades, they'll say, oh, if a miner does this, if a miner does that, and there's always someone saying, you mean if a pool does this, if a pool does that, because the miners are just doing what the pool tells them with regard to activation or not, so the people's understanding of the dynamic of the different properties Parties, the nodes, the devs, the miners, the hashes, the pools, all that stuff.

People's, you know, we have to, you have to take into account the motivations of each actor, or each group of actors, and know that [00:07:00] sometimes they don't align like the way you'd hope. Like, uh, in theory, something that never happened, but if you wanted bigger blocks, for example, because there wasn't enough space and you thought, oh, the nodes could handle a megabyte and a half or two megabytes or something like that, you know, not talking about witness discounts, stuff like that.

Um, you know, the miners in theory would be against that, right? Because the smaller the blocks, the more money they make in theory, but You know, like obviously that it went the opposite way in the fork wars because of a bunch of other factors, but you know, there are times when you can have nodes and people making financial transactions be incentivized against what is good for miners or what's good for pools rather.

And that's kind of the situation we're in at the moment. Uh, it's definitely in the extreme short term, uh, interest for miners to include lucrative, but completely damaging. toxic crap that they're sticking in the blockchain at the moment. I understand the motivation to include that stuff. [00:08:00] Uh, it's dwarfed by a bunch of other factors which everyone keeps ignoring, which has been increasingly simple for me to explain because it was pretty mind boggling for me at the beginning.

But, um, you know, it's not as simple as saying, Hey, if you want Bitcoin to work better long term, prioritize genuine transactions and stop including the spam. that was, you know, that's a hard argument to make on its, on its surface because you do seem, it does seem to be the altruistic minor argument saying, Hey, go against your own short term profit incentives and do what's good for Bitcoin long term.

People are going to laugh at that and say, Hey, well, you can't expect that. That's not how Bitcoin is designed. But when you look into how mining really works at the moment anyway, there's so much nonsense going on that you start to think, wait. If there's only one other option, if I talk to you about the nonsense, and I tell you there's an alternative called Ocean, and you switch there, by the way, it's not much of a coincidence, and it's not too much [00:09:00] of a stretch of the imagination for you to realize, that is the one pool also that has an anti spam mechanism in it.

None of the other ones do, and the other ones all engage in this nonsense I'm talking about that you're probably going to want to get away from for every reason, including profitability. So the spam, uh, the spam mitigation strategies that in theory result in less income for minors, if they are ignored That means mining with pools that are hurting you in so many other ways, in ways that are just about you and your own interest, and also systemically about Bitcoin.

So it, it all kind of magically aligns to the point where I'm saying, at the moment, on a practical level, if you fight the spam with Ocean as a miner, you're going to come out ahead financially. How far ahead you come out, I haven't actually managed to establish yet. But that's not our fault. That is, again, due to the nature of the fact that what happens fundamentally with miners mining on other pools has basically [00:10:00] nothing directly to do with what happens in the blockchain.

Which is ridiculous, but it's actually true. It's basically this whole notion of a miner advocating all of the responsibilities of mining except hashing means they leave everything up to the pools. And leaving everything up to the pools means, how do you know? Whether, you know, you're mining with Foundry, Foundry just found a block, it had 1.

3 bitcoins worth of transaction free revenue in it. How do you get to, and this is the payout I got, what were all the steps in between those two things? How do you verify that they were all done correctly? The answer is you can't. Which is why people keep comparing ocean blocks that have no spam in them to network blocks found by other pools, and doing an apples for apples comparison, and I'm saying Prove to me that that block the other pool found actually had the correct split in it because they don't even claim that that's the truth.

The FPPS payout model is structured so that every block [00:11:00] on the network is taken into account when deciding what a share is. So if you contribute a share as a miner to the process of finding the block, there's a, uh, a policy every pool has that says, okay, here's how much money you deserve for that share.

We are renting your hash rate. Even if no blocks get found on the network, we are paying you for the rental of your hash rate. And so you, as a miner, get cash flow, which is actually their main concern, not profitability. So, saying, we will pay you no matter what happens. You don't have to deal with Bitcoin's randomness.

If we don't find a block for two weeks, don't worry, you'll still get paid, you'll still have your energy bill covered. But, Some, at some point they need to set a policy of saying this is how much your hash rate is worth and that cannot take into account future unpredictable events like how much fees will be in each block because there might be no fees or there might be millions of dollars worth of fees so they just set a level and say here you go here's how much money you're going to be paid out per share you [00:12:00] Then they go ahead and find blocks, and if you get weird blocks, like Antpool mining a transaction that accidentally paid 83 bitcoins as a transaction fee, that doesn't magically mean that just gets split up and given to you.

In fact, your assumption should be that it won't, because they will try and give that back to whoever it belongs to. Uh, you know, whoever it was that made the mistake, and in that case, they called it a gas fee because these people are as much, they're about as Bitcoin y as, you know, as, uh, what do you call him, Jim Cramer.

So, you know, I'm, I'm sort of, I'm sort of giving you the whole high level overview of what I'm talking about here. It's a very different model. It's diametrically the opposite of something like Ocean, where we just say, here's the block. Here's the work all the miners did, transparently, and we are splitting it in accordance with that work.

That's it. And it's utterly verifiable. And competition should sort all this out. It should be the case that FPPS pools should be paying what you'd expect them [00:13:00] to pay. But the problem is, there's increasingly only a couple of pools. The competition is kind of an illusion. And I've been making this analogy of, uh, you've been to London, right?

Um, I guess like, you know, Brick Lane, it's a very celebrated part of London with like hundreds of Indian restaurants and uh, people go there, like it's where you sort of advise, it's like you go to the seaside and eat fish and chips and you go to Brick Lane to eat Indian food, but there's like, if you walk down it, you get this feeling of like Indian hustle culture, where like every restaurant's trying to pull you in, you know.

Like, come into R1, no, come into R1, and they like, fight, and they're like, shoving a menu in your face, and offering you deals and discounts, and when you go inside the, one of the restaurants, you realize it's all the same chef, they're, all, all the different restaurants are the same thing, it's just they have different storefronts, so that's increasingly what mining's becoming like, with the whole FPPS structure.

This is so risky. FPPS means a pool is on the [00:14:00] hook to pay miners, even if it's not finding any blocks. This can make you bankrupt really, really quick, just because Bitcoin's random. You don't know when you're going to find your next block. So, uh, I'll round off with this point in a sec, because I know I'm sort of going over everything here, but this is all I do is talk about this stuff.

So. You know, the point is, there's so little competition, and there's so much, uh, backdoor dealings that need to be done, and it's, it's basically looking like Antpool is keeping around nine of the other pools, like, running. So if one, if, if one of these smaller pools has a run of bad luck, they turn around to Antpool, and Antpool bankrolls them for a while until their luck balances out.

And all this means is, the competition really isn't there. So the FPPS club, which is basically 99 percent of pools now, is, is a rigged system, which means they can pay you whatever they like per share. And good luck trying to verify how your hash rate, translated or [00:15:00] how blocks found by those pools translates into rewards for you.

And we've had a couple of people, uh, these are, these are not claims I want to make with certainty yet. Because we don't know because of the opaque nature of what we're trying to compare transparent ocean payouts to, to FPPS payouts. We can't do a comparison yet because we don't have enough data, but we're almost there.

But we've had a couple of people come to us and say, I've been mining with ocean for a month. Uh, you had a particularly unlucky month and I made around 30 percent more than I did with the equivalent machines pointed to other pools. Now this is an outrageous claim. And I don't want to get taken out of context here.

I'm not going to say that's definitely what's going on, or they're cheating to that extent. But if they are, uh, Motorist yesterday said this is going to be like the, the covert ASIC boost moment of the Fork Wars. That's the Spam Wars, like, bombshell moment, where we find out the pools are really being that greedy, and they're, they're robbing to that extent because they've been able to do it.[00:16:00]

I'm not saying that's what's happening yet, at least not to that extent. What if we can prove this, then I expect mining to just completely blow up altogether, but this is outlandish. It is an extraordinary claim, so I know it requires extraordinary evidence and, but you know, I'll round off there. We're getting there.

Knut: So, so four blocks as of now, right? So, so how many blocks do you think you will have to find before you have this robust evidence?

Mechanic: Well, we need, we don't need that many. We just need the, on Oceanside. We actually don't need that much data at all, because we constantly have a template that we can compare to any network block. Uh, whenever, you know, Antpool finds a block, or Foundry finds a block, we can just look at what Ocean's templates were doing at that exact second.

Because, there's nothing, there's nothing weird going on with Ocean when we find it. You can just say, this split would have gone to all of these miners, and this is all publicly available data. Uh, the Ocean

Knut: don't actually have to find the, [00:17:00] the blocks. You just

Mechanic: No, you don't even need to find

Knut: okay.

Mechanic: Yeah, but I mean, to be honest, um, let's find them regardless.

And then we're going to need to adjust for luck. So if, if it turns out, you know, we're 105 percent luck, you know, we found 5 percent more blocks than we should have, or you need to adjust for that when you make the comparison, then you need to take the fees of all the blocks we found into account. And, you know, Make an average based on all the hash rate for what the fees actually worked out to because it's not fair if we got lucky with the fees in our blocks and the network got unlucky with the fees in their blocks.

You need to compare all the Transaction fees are a nightmare because they make all this unpredictable and they're basically why FPPS is such a scam anyway. Because FPPS was like this sort of temporary payout system that worked when Bitcoin was sustained by Subsidy, because subsidy is so predictable.

You can look at the total network hash rate that is an estimate, but it's, you know, hopefully somewhat reliable. You look at your own hash rate, you look at [00:18:00] how much bitcoin is paid out every 10 minutes, which is utterly predictable. And you do a calculation based on that. I have 1 percent of the network hash rate, there's 50 bitcoins every 10 minutes.

That means I get five, you know, I get 0. 5 bitcoin every 10 minutes. That's a very easy calculation. But when blocks, uh, when miners are sustained by transaction fees, how do you know what those are going to be? You don't. You have to keep recalculating everything. And the fact that that's such a difficult calculation to do correctly.

Um, and to predict things in the future becomes like price prediction rather than going by halving cycles, which are utterly rigidly defined with exact amounts that never vary, you know, that's, you're in a different world there.

FPPS and Mining Pool Payouts

Knut: So, so for those who don't know, what does FPPS stand for? Like what's the abbreviation?

Mechanic: Full paper share, and what this basically means is, every time you do a, you know, every time you prove some work and submit that [00:19:00] valid work to the pool, the pool says, alright, you get this much sats for it.

Knut: Regardless of if the pool found a block or not.

Mechanic: Exactly.

Knut: And the opposite would be another abbreviation, I suspect. Which

Mechanic: the, the competing system ended up being PPLNS and what, uh, we have, we call it the TIDES payout system, obviously supposed to throw back to the fact that it's called ocean and we, you know, in keeping with the metaphors around the whole concept of permissionless mining, you know, pools versus the ocean, right?

So TIDES obviously is sort of designed to be in keeping with that. It's a PPLNS derivative system. PPL& S is, but if you want to pay out your miners based on the blocks that are found, you basically cut up the block and give it to each miner depending on the percentage of work each miner did. Pretty logical, but if you just do it crudely with a straight up proportional payout system, it's gameable.

Uh, everyone can, uh, there's something called pool hopping, [00:20:00] where basically right after the network finds a block, you jump on. Sorry, right after the pool finds a block, you jump on and you mine with them for a short time because at that point you're doing, you're, you're a much bigger percentage than you would be if the pool's getting unlucky and you come and mine with them and you're submitting shares towards, you know, work that's going to be disproportionately poorly rewarded.

So to get rid of pool hopping from directly proportional payouts, you have this system emerge called PPLNS. which is pay per last n shares. And what that does is it, it averages that out. So you need to mine with the pool for a while to start getting full rewards. But after you leave, you carry on getting rewarded, even if you're not mining with them.

So that, that has this kind of ramp up and ramp down period, which means if you pool hop, it's a waste of everyone's time, including your own, and you might as well just stay there. Um, we disabled the ramp up period, which meant, because we didn't want, uh, miners to have to wait [00:21:00] eight blocks, because that's how long our end value is, is eight network blocks, roughly.

Um, that's, that's an approximation, because it depends on how lucky those blocks are. But, we disabled that ramp up period, because obviously we don't want fresh miners at a tiny pool, finding one block every week, if we're lucky. To have to wait eight weeks to get proper rewards because that's not viable.

We disabled the ramp up that got dubbed as the bonus period, which a lot of people don't understand. That's been characterized as us giving miners our own money to try and make it worth it. We're not doing that. It's still just money coming from Bitcoin blocks. It's only a bonus in so much as if you ever leave the pool, you carry on getting rewarded for blocks after you've left, because the ramp down still exists.

So, that's a fun thing to correct there, because I've seen a lot of people not understand what that is, or think we're literally paying people to mine for us. We are absolutely not doing that. so that's PPLNS. PPLNS is the opposing system to [00:22:00] FPPS. It's PPLNS. The main way in which they are diametrically opposed is FPPS says I am a solo miner as a pool, I will deal with Bitcoin, and I want to rent some hash rate, and I will figure out a value of your rented hash rate, I can pay you in fiat if I want, you don't need to care if any blocks are found by the network, you have no way of verifying your own split of the fees within it, I am just going to pay you, you know, one sat per share and that's it, and I can pay you via fiat or whatever, and there's even one public mining pool that openly says we are not a bitcoin miner, we are a hashrate rental service, and we do this deliberately because we don't want regulators coming after us.

We rent our hashrate to Foundry, that's it. It's nothing to do with Bitcoin, we are not a miner, and there are serious ramifications for, for, you know, for saying, you know, Bitcoin is decentralized, distributed proof of work, you know, when you have the people doing it that have that mentality, that is not without [00:23:00] consequence, no way, so anyway, that's FPPS, Hashrate Rental.

PPLNS is, I'm mining with a pool and I need that pool to find blocks because I don't get paid any other way. The pool isn't taking on any overhead or risk. The pool isn't absorbing all of the bad or good luck and pocketing the good luck and going bankrupt during bad luck potentially and having to maintain a big enough buffer for that to be viable.

You know, if you have to maintain that, that buffer, that's a huge, uh, that's a huge piece of overhead you need to maintain. And ultimately it comes out of the miner's pockets, or results in a sort of clandestine system where it's all one giant system supported by the fact that Bitmain can also make money selling hardware and maintain the whole system that way.

And you know, it's this anti competitive stuff going on there as well. So yeah, that's PPLNS is basically, you have to be a miner again. You want to mine in a pool because you get regular income. You stop, you solve the cash flow issues that come with solar mining, but that's it. [00:24:00] After, uh, other than that, you still need blocks to be found, and your, your reward is based on what's in the block.

That's it. So suddenly everyone cares about mining again. Every time Ocean finds a block, it blows up, for some reason. On Twitter, everyone cares that Ocean found a block. No one cares when Antpool finds a block, because it doesn't matter to any other people mining with them, it's irrelevant. So yeah, it's made a lot of fun come back to the mining space.

Knut: that's a great marketing strategy, or like, uh, something you probably didn't think of, but that just happened to be a good attention. Trawler. Yeah.

Mechanic: we're, we're, we're very good at accidentally blowing things up and being genius. We look like genius marketers, we're not. I think this is technically my department and like every single thing we do seems to cause a massive controversy. Whether it's not having the attitude about spam we do, whether it's the multiple templates, whether it's the fact that we found an empty block, which is a 0.

1 percent of blocks are [00:25:00] empty, and we have only found four. So the chances of us finding an empty block was so vanishingly unlikely, and we did, and of course the trolls came out in force, like, oh what are you doing, your spam filters are broken or something, and

Being Talked About

Knut: but this is, they're helping, they're helping you. I mean, this is, uh, reminds me of that Marilyn Monroe quote, like the only thing worse than being talked about than, than being talked about is not being talked about.

Mechanic: I mean, the haters are definitely very helpful, but it's stressful at the same time

Knut: Yeah, of course.

Mechanic: if you shoot, you better not miss. And, you know, when I have to respond to these people, like particularly, like there's a few sort of the old guard that I really respect that have been taking a lot of shots at Ocean.

And, you know, I'm really sitting there like, wait a minute, am I nuts here? Or is this guy that I've like admired for like 15 years. Straight up not understanding this, because all that stuff about FPPS that I just said, I don't think anyone understands it. Even the miners. Because [00:26:00] miners are not, everyone's like, all miners care about is profit.

If you're telling them you're going to exclude a few lucrative spam transactions, they will never go near you. It's that simple. And I'm saying, wait a minute, are you aware of all the other stuff going on? Because I don't think they are. I think what they're motivated by is cash flow. If you can mine with someone that can guarantee you a payout every 24 hours, there's a massive cost to that, but you can trade it off with the fact that you have energy bills you need to pay, and you can't be dealing with ambiguity around whether the pool got unlucky with blocks this week, so you will take a massive haircut for that.

Yeah, I get paid 7 percent less mining over here, but I always know that my money is going to be there every 24 hours. That's, that's a different motivation. And it's still all about, you know, viability of economic incentives, right? So, you know, it's when we come along and we, we can make the opposite claim.

We can say, look, we can't guarantee anything. We have no idea when we will find a block. It's six days from now. And in six days, it will still be six [00:27:00] days because Poisson distributions are Poisson distributions, right? But you will get. Everything that's in the block that you're supposed to get, and you'll get it in the coinbase payout if it's over a million sats, which is immediate, right?

You cut out the custodian in the middle, not your keys, not your coins. Obviously, the limitations of Bitcoin, I mean, we can't, if you're a tiny miner, we can't give you 10, 000 sats every block because it's useless to you. You won't even be able to spend it without burning the whole thing as a transaction fee.

So, we got blasted over that as well, but like We'll have lightning to take care of that, uh, not too distant future and it's a pretty elegant setup we have for that, but yeah, like this accidental marketing thing of just pissing everyone off and having everything we do just become a massive scandal, it's been great, like it's, it's been fun, very stressful, uh, up and down, but you know, I think probably it's a massive net positive.

We have 0. 1 percent of the hash rate and all my time. [00:28:00] Twitter does is blow up all day with notifications and, you know.

Knut: Yeah. It's been beautiful to watch it from afar, these debates and as you say, with the other OGs that you respect. Like it's, it's very, it's very entertaining and, uh, edu educational to read it like, and, and to, to try to make sense of it.

Risk of Mining Centralization

Knut: so I, I always.

React when people say that Bitcoin is backed by energy, because I, I think it's a, uh, uh, that statement in itself is a misunderstanding of how many factors that play in this. It's a more accurate statement would say, be that Bitcoin is backed by human action, which in turn requires energy, but like we are the Bitcoins, right?

Then we, we are the ones who are the actors who, who decide what to do and all the computers involved are just. And the hashing is important, but all it does is tell the network how difficult it should be to find the next bitcoin, so that bitcoin can be a clock, like, [00:29:00] and tick tock next block and stuff. so, is this, you know, narrative that bitcoin is only the hashing power, is that the thing that has Is that narrative causing this potential attack factor that this spam is?

Because it's becoming quite clear that mining can be centralized. If it's true what you're saying about the pools and them bailing each other out, we're back into a central banking situation here. And how big is this risk to begin with? And is it because of these digital energy narratives that we've ended up in this place?

What is it?

Mechanic: I think it's just to do with, um, a deviation from the theory, like, I don't even know how much Satoshi got into the concept of pooled mining. Pooled mining is, it's a, it's an obvious phenomenon that would emerge, but the problem is, like, assuming that a pool's economic incentives and rational actions would align with [00:30:00] the other, you know, components of the Bitcoin ecosystem.

It's like assuming Coinbase as a custodian would align with it all. It's totally nothing to do with it. It's a massive centralized entity that has to comply with government regulations to be allowed to continue to exist. So, the fact that they would magically line up with what it is Node users and people doing financial transactions would want, is a total fallacy, and people, and to this day, I just see impractical, philosophical, masturbatory discussion about, oh, a miner will always do XYZ, and I'm saying no one is mining, no one is solo mining, right?

Everyone is using a pool. You have two pools. Foundry and Antpool that are way over 50%, so the fact that that is now, it's such a wide open hole, or an Achilles heel, and it doesn't matter, the fact that everyone can just switch mining pools should one of [00:31:00] them act maliciously, is demonstrably just not happening, because they are acting maliciously, and I think, it's not the narratives exactly, no, it's No, I'm going to agree with you.

The narratives are a big problem because they don't reflect reality. The miners are not miners anymore. They are just hashes. And I've been trying to change this, this part of the lexicon for months now. I'm saying you cannot go, like Bob Burnett is a great, uh, is someone that just got it immediately. Like we had a, we had a phone call right at the beginning when I joined Ocean and I told him like, look, miners aren't making block templates anymore.

Knut: Now he's, he's the first, uh, first one we talked to this stuff about, like, uh, a couple of months back. We had him on and talked about exactly this.

Mechanic: Yeah, he's, he's fantastic. He's one of the few people of that generation that just gets Bitcoin on a deep level. Like, he's not, there's a lot of other guys that I really like too, like Greg Foss and Lawrence Leopard and Lynn Alden and all those people. Like, they, The understand the greater [00:32:00] environment and all that stuff, but when it comes down to the nuts and bolts of where Bitcoin has weak points, Bob is just absolutely on fire with this stuff, and when we sat down with him and Ocean and we discussed these, I get it, and he just said, I want to be a Bitcoin miner for real, I don't want to LARP about the whole thing and just be hashing Solving blocks sent to me by Foundry or Antpool or F2Pool or whatever.

It's like, I want to actually be a miner again. It doesn't matter how much you distribute the hash rate around the planet. If the, if all of the template construction is going on by a tiny group of people, that means a cartel with basically one or two, you know, loosely competitive entities is deciding what goes in the blockchain and where all new coins get sent once they're, once that's, you know, defined, that's not decentralized.

It's, that is a, the obvious central choke point of Bitcoin at this point. So if [00:33:00] you have miners caring about this stuff by being actual miners again, rather than just hashes, then I think my favorite way of describing it was, if you have a pool, start complying with government crap. Saying we're going to actually censor, we're going to block OFAC.

Uh, you know, in accordance with the OFAC list, or we're going to all equal output coin joins, we're not going to include them in our blocks anymore, or, you know, any other controversial type of transaction, like here were a bunch of coins associated, UTXOs associated with the Silk Road, we're not going to put them in our blocks if anyone tries to spend them, anything like that, that's clearly some sort of bootlicking, government complying thing, if you only have a couple of people constructing templates, It becomes realistic to actually stop those things from moving.

If you have thousands of people making templates, then it becomes a silly exercise in futility. And that is the position you want to be in, right? You want thousands of people making templates because [00:34:00] then when you're making transactions, even if 500 people Pools making templates, for example, even if all of them hate your transaction, it doesn't matter, because there's another 5, 000 people that don't care.

That's what you want. And right now, most people's idea of censorship resistance in Bitcoin that emerged after Ocean had one template that would block all the spam, everyone said, you're attacking Bitcoin censorship resistance. And I'm saying, this is not Credibly censorship resistant. There are so few people making templates and Ocean is one of that tiny group of people that you think the solution is yelling at us on Twitter for not including a transaction you like.

The solution is you need thousands of people in our position and then you don't care when we do this because if we do this and you don't like it, you can just laugh at us. Instead, you're melting down because someone is. exercising the freedom as a miner to put what transactions they like in blocks.

There is no obligation to put a [00:35:00] transaction in a block if you don't want to. If you're trying to force people to put stuff in blocks they don't want to, beyond the financial incentive you offer, that's coercion. That's the flip side of the censorship coin. Because forcing us to exclude stuff is censorship.

Forcing us to include stuff due to the limited block size Is also censorship, because we're just foregoing something else. If you force us to put spam in blocks, you're forcing us to censor real financial transactions. And because of the coercive element, that is more credible as a claim of censorship.

All we said is, we do not want to put this stuff in blocks, we find it harmful. But the whole point of our product is the antithetical to that, which is when miners make their own templates, which is the goal of Ocean, are you guys going to block templates that contain spam? And we said, of course not, because that defeats the whole point.

When our miners are making their own templates, they can put whatever they like in them. In fact, ideally, we won't even be able to tell what they put in them until they find the [00:36:00] valid block, and then there's nothing we can do about it. The only thing we want to know about blocks is, did you do the reward split correctly?

That's it. Other than that, do what you like, because this is how you create censorship resistance in Bitcoin.

Wasabi and Censorship

Knut: That sounds a lot, sounds a lot like what Wasabi is doing, yeah.

Mechanic: Wasabi's a great product, and, uh, they got, they're, they're equally controversial. I do, like, I understand the criticism there is more understandable, of course, because, you know, they, they're, they're using a list inspired by government. You know, legislation of sorts. I'm not sure what the nature of the list is, but there's some sort of chain analysis firm that's coming up with a list of UTXOs that are bad for some reason.

In my estimation with this, if, because I don't work for Wasabi, Uh, I feel like this is the thing they can't say that I wish everyone would shut up and read between the lines about, is they can either fight this useless piece of legislation and be [00:37:00] embroiled in lawsuits for the next 10 years and kill the product, or they can comply with it And it's when it's completely ineffective nature, like if you are on this blacklist and wasabi won't let you use their coin join service, just go one extra hop, just send the bitcoin from here to here and then do it.

And it's fine. And they're going to turn a blind eye to it. And, like, it's a practical way where you can get around it. I understand, in principle, if that makes you too sick, then fair enough, but, in my opinion, it just, on, like, read between the lines, like, they're trying to, you know, you're trying to outlast the state.

We know the state's days are numbered. To some extent, because of how much Bitcoin undermines them by taking away the money printer, just let Wasabi do what it needs to do for now, like it's going to make your stuff private, it's not actually broken software, so this is my sort of, I understand if anyone wants to be philosophically, you know, it's iCal about it.

Fair enough. They are like, I think there's even [00:38:00] some financial benefit to the chain analysis company 'cause they have to buy the data from them. So that's something that might make you very sick to do if you are, you know, with abi. But, uh, I think, you know, I, I'll definitely give them the benefit of the doubt with it.

Luke: I know that, that exact thing that you, you, uh, talked about, the sending a 2 1 hop or whatever, that actually works. I'm not gonna say how I know that. Yeah, I, I, I know how that, that works exactly, but no, we've, we've had Max, uh, Hillebrand and, uh, also Rafa, who's he is one of the contributors there, uh, on the show.

We're, we're, we're friends with those guys. And yeah, wasabi is, uh, definitely, definitely great. I mean, it, it, it works really well and I mean, yeah, so, so interesting to hear your, your take on the matter, but I can confirm that exactly what you said works. So,

Mechanic: That's, I've never had that confirmed to me before. I've just read between the lines,

Luke: Alright, you might have noticed that we've recently partnered with AmberApp. After our episode with [00:39:00] Izzy, their CEO, and our close friend, we knew we would have to partner with them in some way, If you haven't seen our episode with Izzy, definitely go check it out, you'll see why it's such a great fit, and honestly, they're following the orange glowing light like Izzy always says, and that's exactly what we try to do here at the Freedom Footprint Show.

The big news about AmberApp is that they're going to be launching their version 2. I've seen some of the screenshots and it looks fantastic. They're going to be including a non custodial on chain wallet, an anonymous lightning wallet, a fiat wallet, And finally, it's going to be an exchange, of course. it's going to be just this super app, They're also going to be launching globally.

Everyone's going to be able to use it. we're really excited about all that. Stay tuned with us and you'll hear all about it. And for now, check out their website, amber. app and the episode with Izzy to find out more.

Maybe I can take us in a slightly different direction because I think the discussion so far has been about kind of [00:40:00] the technical apparatus of what Ocean is actually doing, right?

Ocean and Bitcoin Spam

Luke: But what about the problems that are happening around the network right now? Everything to do with, say, For example, Ordinals and the mempool being completely full, all this and that. Do you have any take on that? Like, what's the real problem, the real risk of all this happening? Because it's an interesting coincidence that Ordinals came up in the course of this same period of time.

Mechanic: Yeah, I mean, it all happens for a reason, right? I know this is, um, it's a very funny coincidence, because we now, we did get accused of one point of being the cause of the spam attack for our own benefit, because it's such a perfect thing for a problem we're trying to be solved. That we're trying to solve to be so manifestly awful at the exact time that we launched the [00:41:00] product that solves that problem.

So, I understand that sort of smooth brain conspiracy theory that floated around for a while. But no, demonstrably made life incredibly difficult for us, uh, having this anti spam policy. Um, so it's not something we cynically are doing. We're not the originator of the stamped spam. Or the inscription spam, just to shill our own product as a solution for it.

But,

Luke: hope not.

Mechanic: but the fact that that is something you might sort of in a, in a cannabis inspired moment go, Oh, right. Like there is a link there. Does kind of reveal something about the, the happy coincidental nature of it. this spam is at the worst it's ever been. So I've totally dismissed this argument people keep making of, don't worry, the spam will be priced out.

By genuine financial transactions. Why is that an assumption everyone keeps making? It demonstrably is moving in the opposite direction. There is more spam than there's ever been. And to me, it's like the argument of saying there won't [00:42:00] be casinos in a few years because everyone knows that casinos make more money than they lose and people will eventually just run out of money.

So there just won't be casinos. I'm like, that is Obviously not true. Your worldview lacks some sort of essential piece of information because that's not happening. So the idea that there's just going to be a natural cessation to abuse of the blockchain for an unintended purpose that bullies out the real intended purpose of it is a ridiculous assumption that is demonstrably practically not happening.

And also, it's more fundamentally, to speak to your point, when you bastardize the intention of the whole Bitcoin project, By making it, something that can be used for its unintended purposes, you just create an economic externality, and this has been, this is philosophically just something you can reject, right?

And Andreas made this point years ago, like, if you're coming up with altcoins, who do useful proof of work, like find prime numbers, or fold protein [00:43:00] DNA, or something like that, If the value of prime numbers is ever up or down, you're creating more mess and chaos in an already chaotic system of price discovery.

Bitcoin's already all over the place. You don't want mining to have some sort of other element that adds more noise and more variables to it. Like, the whole point is that money shouldn't do anything else than be money. If you can eat it, or if you can put it in your car, or any of that stuff, it degrades it.

Purely monetary value, and the block space should be a competition amongst people engaging in genuine financial activity, engaging in fake financial activity that represents markets that are nothing to do with Bitcoin, like the buying and selling of intellectual property to steal man NFTs. You know, that's, it's irrelevant to Bitcoin having to do that.

It can't enforce it. So we know the whole thing is kind of a joke anyway. But even if it could, this is not, we don't want to subject the block space [00:44:00] market to the whims of these pump and dump Things that are not native to it and add more noise and more problems into the, into an already chaotic system.

You don't want to introduce economic externalities. You want to limit what the blockchain can do to the confines of what's logical, which is spam filtration. We need this. To only contain genuine financial transactions. That's not to say we can totally objectively define spam and block all of it out effectively.

There's always going to be some arbitrary data. We, we accepted that. That's why OpReturn exists in the first place, right? But, we need to keep it to a minimum, and we need to understand, as a community, why it's important to do that, and we need to reject the idea that you can make all this extra money by including it, because it barely works out to anything, and on a practical level, You can reject it.

The one mechanism you have as a miner for rejecting it, which is going to ocean, is probably going to [00:45:00] result in more money. I still don't, I don't want to be quoted on this yet because we still haven't proved it. But I mean, this is definitely going to be taken out of context at this point. If we turn out to be wrong about this, I expect to be absolutely blasted for it.

But I'm just saying it's a hunch. And if that's the reality of it, if you can, if you can observe and be honest about the fact that this stuff is toxic to the Bitcoin network, and it's not. Financially disadvantageous for you to reject it. Then you have every reason to do what's good for Bitcoin because there's no, it's just a lack of education that would prevent you from doing so.

Knut: Yeah, this is a point that both Mises and Hayek and Rothbard pointed to as well, that the other use cases for gold than just money, the industrial use case and the jewelry use case, actually make gold a worse form of money, not a better form of money.

Mechanic: Exactly. You money needs to be limited to, this is the, it is free markets. Free markets need to be within. The, the boundaries of what the thing [00:46:00] is that you're buying and selling. That's just a given. And also, appeals to free market economics with a fiat money printer existing that can funnel money through venture capitalists into JPEG scams is not a free market.

That's an illusion. So again, Reid Seyfardin, you know, I don't know how, how, how big of a fan you are, but I love, you know, I love a lot of what he's talked about. the idea of fiat economics just corrupting everything and making everything. Markets not reflect true value at all, like, you know, using a house as a store of value instead of a place to live, like, because the money's so broken, etc.

Like, the free market, appeals to free markets to fix everything in Bitcoin is just so utterly naive that it drives me crazy. Like, you need active work, you need developers working for free in their spare time because they care about this thing to make it better. That's not Like, you can always find some selfish motivation if you like, but ultimately people need to care [00:47:00] about Bitcoin to make it work in the future.

If they don't, it's not just tragedy of the commons, it's where did the genius spark come from? Who was motivated? Who cared about humanity's suffering under fiat enough to invent Bitcoin? It's, it's about caring ultimately. You have to care.

Knut: Yeah, yeah, but this is the thing, like when they appeal to free markets, they don't actually mean free markets, like, because Bitcoin is Sort of the only free market there is. They mean the fiat free market, which is not free. It's, it's, as you say, someone has a money printer and therefore it's skewed. It's, it's not, it's not a, uh, an honest representation of what a free market would do.

The Risk from Ordinals and Inscriptions

Knut: So that, which reminds me of, uh, I guess you've seen them too, all these tweets about, uh, um, where the money's coming from. So, like, this list of who's funding the, uh, Ordinal's, the Taproot Wizards, and there are even, [00:48:00] there are connections to BSV people, to Ethereum people, and even to the CCP, the Chinese government, like, the, uh, So, how, how worried should we be?

Is Bitcoin broken? Like, what is this?

Mechanic: yes, Bitcoin in a practical sense can be attacked for basically no money at all, it turns out, and this is, again, it's, it's Giga brains not understanding how stupidity can destroy stuff, like, you can design the most genius product in the world, but you forget the fact that some idiot's gonna bash his wife over the head with it, and you need to somehow take that into consideration, right?

Now you've gotta write a label on it saying, this is not a weapon, or something like that, right? Like,

Knut: Employees must wash hands after

Mechanic: Yeah, right, or like, you know, caution, the hot, the coffee is hot, right? Like, or any of these things that, like, you know, this is, this is the bane of humanity's existence. You can't, you can't, it's not just litigation though, right?

It's just the fact that you, you have to take into account stupidity and malice, which [00:49:00] usually means 99 percent of what we could have had isn't possible, because there's always that, there's always that tiny contingent of people that can use something for its unintended purpose, which means we have to Walk away from 99 percent of the features.

Fair enough. These things happen. Like Francis Puglio, um, you know, I had a signal chat with him ages ago. And to my surprise, he sort of posted a screenshot of it, uh, of something he said within it on Twitter saying, this is it. Like, you can, the gigabrains are saying, how much money does it cost to 51 percent attack bitcoin?

Okay, you need to spend X amount of billions of dollars getting all the hash rate in the ASICs, and then you need to do this, uh, you need to maliciously cause as much disruption as possible, you need to orphan as many blocks as possible, maybe you do a whole hundred block reorg, just to really cause chaos, and you do a bunch of spending in that time while the honest network proceeds, and you double spend everything in this hundred block reorg.

You completely trash Bitcoin's value. How many billions of dollars is it going to cost to do that? What's [00:50:00] the best bang for your buck? In reality, you spend a few million bucks financing absolute retards and you get them to spam the network and believe in a system. You just need it to reach escape velocity, because you're going to burn yourself out of money pretty quickly, but if you can do enough marketing that the idiots can sustain it by buying pictures of apes or whatever, if you can get it to reach that threshold where it becomes self sustaining, then Then you don't need to keep funding it, and that's, that's a very viable attack.

You've, you've stopped Bitcoin for being useful for its, uh, intended purpose. You've effectively shrunk the block size, and we know that makes life harder for people doing genuine financial activity, without the benefit of shrinking the block size, because nodes still have to store all this data, they still have to process it, you still have the time.

The lag between one pool finding a block and another pool downloading it and verifying what's in it, you still have the disadvantage of that being more data [00:51:00] than it might have been. So right now you have the worst of small blocks and the worst of big blocks combining. That's no good. It's a very effective attack.

It's very cheap. And it's something that It's easy to mitigate, in my estimation, but it's not easy to mitigate if everyone is so gaslit and pretending and engaging in philosophical whataboutism and saying, but what is spam? How can we define what a legitimate use case is and what it isn't? And I'm saying, look, On a practical level, this is, this is potentially a very risky analogy, but I'll make it.

In El Salvador, Bukele rounded up basically all of the problems that are making everyone's life in the country miserable and threw them all in prison. And it's taken me a long time to reconcile whether I'm okay with this or not. It obviously violates so many principles that almost every Bitcoiner holds.

But. To steel man it, El Salvador's in better [00:52:00] shape than it's been in forever. The 99 percent of the people that live there are much happier as a result of this happening, and when choosing who it was they were going to throw in prison and treat in this awful dehumanizing way. All these people voluntarily labelled themselves with as many tattoos as possible to say I am a gang member, I am the one going around causing, you know, I'm the one raping and pillaging and doing all this stuff, so I'm saying you have about, what is a gang member, what is a normal human that doesn't want to hurt other people, where do you draw the line, I don't know, but we have about as clear line in the sand as possible with these people, they've labelled themselves as Nostr, Erik You know, as malicious, horrible people, and now you, they are effectively a sort of ragtag government anyway, and now you have a more civilized government come along and throw away the smaller government, you know, I'm not going to cry about it too much, and I'm also not going to, I'm not El Salvadoran, so I don't get to, you Be an armchair critic of it as [00:53:00] sort of fundamental human rights abuse.

I'm just going to say, look, it made life better for the people in El Salvador, and I don't think I have the right to comment on it beyond that. So when it comes to the spam attack in Bitcoin, I think you can so trivially figure out what this stuff is. Yes, there is no objective definition for spam versus You know, legitimate transaction.

We can't ever draw a firm, concrete line, but all this stuff is so easy to spot. It all uses the same few mechanisms, and so you can just, you can simply update the data carrier size filter to include it. Uh, you know, the, what is it, the envelope they use between op if and op end if after an op false statement that invalidates the whole if condition anyway.

You just, the stuff in there makes that subject to the data carrier size limit anyway. The, the, the, the external, you know, disadvantages of doing that seem extremely minimal, though admittedly I'm not the expert here. then, [00:54:00] uh, you can, uh, you can turn off bare multisig. Because the defenses of that are zero, in my estimation.

There are way better ways of doing multisig, and if you want stateless multisig on Bitcoin, which is what it's theoretically for. It's not on, it's not on every node user in the world to store a backup of your multisig solution. That's not of interest to me as a node user. It's not fair to burden me with that.

And if there's a way for me to reject that, uh, with my mempool policy filters, even if I don't have to change Konsensus and it might still end up in blocks, that's reasonable. So you can update the filters. That's all we're saying. Then the argument moves to, okay, if you update the filters, You're not changing consensus, so this stuff can and will still just end up in blocks.

Uh, you're playing, you know, what's ultimately the goal here. You're not going to effectively stop it. And I'm saying, I think we can, actually. I think if most of the network is saying, we consider this stuff undesirable, the conversation will have changed. We will have moved away from, what is [00:55:00] spam? To, this stuff is spam, minus why are you still including it?

Don't make us fork the network again. I don't want to do that. You don't want us to do that. Just stop including the stuff. You're only making a couple of million sats extra per block, divided by everyone in your pool. It amounts to an incredibly low amount of money. It's obviously causing a lot of damage.

Voluntarily, guys, just stop, and then you have this whole learning thing that we have to do once every few years where we realize nodes are the boss of the network, miners are the employees of the network, sitting here sort of passively saying, well, miners are going to include it, you know, they are not the boss of this stuff, they fit within the rules that we need.

Hold them to, and they need to do that. And miners ultimately degrade their own arbiter of whether what they're doing is worth money or not. And, uh, that comes in the form of, uh, the number of nodes on the network. If a hundred thousand nodes say, yeah, I consider that block [00:56:00] valid, you're good. If there's a thousand nodes saying, I consider that block valid, Then you're in Ethereum land, then you're in Bcash land, and then you're in trouble.

Like, you want that work you're doing to be validated by a large enough group of people that it's going to persist. So don't attack that group, don't make their life harder, don't disincentivize them from validating your work. Because you will lose as a miner ultimately if you do that. You can just say, oh, I'll let other people be ethical like that and I'll be fine.

But I think if you, if we send a strong signal to the miners that we don't like this stuff, we don't want it there, with the further practical consideration of the fact that there's one pool that allows you a mechanism to reject it, which is ocean, and none of the others do, and the other pools are all dishonest and a joke, I think that's a very practical uh, scenario in which you can stop this stuff and you can have it end up in blocks every now and again, but I don't care because I'm going to say that's demonstrably a lot better.

Yes, we didn't theoretically define [00:57:00] spam versus genuine transactions. Yes, we didn't stop all of it, but we're 90 percent better and I'll take it and I get so annoyed. With everyone trying to say, well, if you can't do it perfectly, no point doing it at all. I'm like, that's, that's a fallacious argument. I'm going to make things better, and he who says it cannot be done should not interrupt he who is trying to do it, unless you want to admit that you just don't want me to do it because you're financially invested in all of these scams.

And that's where I start to get really annoyed.

Knut: I mean, the opposite is true, like, as many people as possible should try to do this to some extent, and like, show people that they don't have to follow whatever rules are set by the 95 percent of the other fucking pools.

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Owning Stars

Knut: So, okay, I'm gonna do an analogy, a slightly updated version [00:59:00] of it from our conversation with Giacomo.

So, and you can see to which extent you agree with this. So you have a, um An observatory with a bunch of astronomers employed at the observatory, and you're observing the Andromeda Galaxy, and all the astronomers are watching the stars in the Andromeda Galaxy, trying to figure out what they're doing, and the patterns they move in, and what they consist of, and so on, and all of a sudden, there's um, A bunch of charlatans and snake oil salesmen and scammers who start to sell the stars in the Andromeda galaxy to gullible people who think they can own a star in a galaxy.

Yeah, and the astronomers have to spend their time, uh, filling out this, uh, making invoices and filling out forms for these people trying to buy stars from scammers. Is that a good analogy for what's going on here?

Mechanic: It's a beautiful analogy [01:00:00] and it's, it's actually been used a long time. I don't know when you had that conversation with Giacomo, but that was one of the first analogies I ever heard for NFTs or just the concept of, you know, trying to explain what it's, it comes down to intellectual property. How do you enforce intellectual property?

It's, it's generally enforced on the social layer. Like it's, if, if I come up with a term, like if I'm, If I'm Drake or Rihanna or something and I come up with some new slang term on Instagram and everyone starts using it, a lot of people are gonna be like, oh yeah, that was him that came up with it,

Knut: Yeah, then you'll be under that umbrella, ella, ella, ella, yeah,

Mechanic: well, like, you have, I mean, that's, you can establish things that way, you can be famously influential, you can monetize it too if you like, because if you come up with that word and everyone starts using it, Who cares, it's decentralized, uh, language is decentralized, but if Disney make a movie and they say the word in it, then you can go and sue Disney, and you can make a bunch of money, and you can prove that you invented the word, um, but the proof comes [01:01:00] from demonstrating, uh, you know, that you were the first to do it, and there is a use to having history in the blockchain to some extent there, but this is about as far as you can get with it.

Uh, with, uh, Steele Manning, the whole in, you know, demonstrating the creation of intellectual property inside a blockchain. That's it. Uh, beyond that, it's, it's not, there, there are so many other ways of doing that, that are more efficient because you could also just email it to yourself. And that's it.

That's going to persist, and you can say, Hey, that word, I emailed it to myself, here, it's on Google servers, I'm gonna take a screenshot of it, and you show that to the judge in your lawsuit with Disney, and he says, Yeah, you started this whole thing, fair enough. Disney, you owe the guy 800 million dollars now, or whatever ridiculous compensation they go for.

Like, the whole point, intellectual property is only really of interest. To the person selling it and the person buying it. It's not a thing that needs to be a matter of public record in most cases. [01:02:00] So when you're buying an NFT, the guy who made it can just email it to you. And the point is, if they do that, then, and it gets violated, you're in exactly the same world as if it was a blockchain established.

Uh, you know, change of ownership, because like everyone keeps pointing out, I can right click on your JPEG and I can download it and there's nothing you can do about that. That's true of any intellectual property, right? I can

Knut: yeah, it's true of all data,

Mechanic: yeah, of course it is, but it is enforceable in certain contexts, like every time a radio station plays your song, They didn't download it off Pirate Bay or whatever.

They actually are going to give you the royalties because they're, they're, they're a target they can actually do like an internet pirate station. Doesn't have to worry about it. You know, a licensed FM radio station does have to worry about it because they have a target on their back. There are. They're an incorporated big entity that is realistic for you to go after if you are the, uh, the owner of the ip.

But if you're the owner of the ip, who cares whether [01:03:00] you established the IP in a public blockchain or whether you emailed the song to yourself three years ago. They're exactly the same from the perspective of we are going to court, we're going to figure this out. I'm going to get money out of you for violating my intellectual property.

There's no difference. So why do you want the whole world to know about the establishment of this thing versus, you know, it's, there are differences, it's not identical, but for the most part, the fact that there's no real, the fact that there's a very limited use case for making the whole thing a public change of ownership like this, that's, ignores the fact that the interpretation is always happening externally, and external interpretation is fraught with centralization.

And misunderstanding and, you know, you know, a million different things that can all go wrong to the point where you're like, look, so you sold me this NFT on this blockchain and you sold me it, you sold the same one to someone else on another blockchain. What's a judge [01:04:00] going to do with that if, you know, a big incorporated entity comes and violates the IP of your NFT?

What's he going to say? Oh, Well, I checked the timestamp on this block, but it was broadcast to the network three minutes before the block was found, actually. Uh, so it was found earlier in Bitcoin's blockchain, but it was seen by the Ethereum network before, uh, it was seen by the Bitcoin network. Um, like, I find it so funny that anyone would ever, like I think that's a realistic scenario, like it's, no one cares, ultimately, it's not, it's never gonna happen, everyone is, everyone would just right click and violate the, the IP of your NFT, if it was even worth doing it, but in reality it's just a bunch of pixelated crap masquerading as art, and it's wash trading, money laundering, you know, just scams, pumps and dumps, and.

It's, it just couldn't be more of an insult to the injury Bitcoin is undergoing at the moment for this stuff to be claiming itself to be art. It's just, how much more, like, does it have to write on its forehead, [01:05:00] I am an attack, I am not doing anything good for anyone, anywhere, and like, for Bitcoin is just to go Maybe I should take this stuff at face value and stop, you know, masturbating and trying to sort of come up with some sort of call to inaction, which is what everyone is engaged in.

Yeah, there's no reason to do anything about this. It's all fine.

Satoshis Don't Exist

Knut: like, this is why I like the Andromeda Galaxy analogy so much, because, like, it's not only the JPEGs, but every other set of arbitrary data, these BRC20 tokens, or whatever they call them, like, it goes for all of them, because the Satoshi, is special. It's more than just data. A Satoshi doesn't exist.

It's just the UTXO sets and so on. But a Satoshi exists in another sense. A Satoshi is a very, very precious and special thing. And anything else attached to the time chain. It's not. It simply isn't. It's just this, like, uh, something that [01:06:00] everyone can see and, you know, everyone can see the star in the Andromeda galaxy and it doesn't matter what kind of paper you, you, you give one another for the owning rights to it.

It's still not going to change it. It's still attached to the transaction and not the Satoshi, right? It's, it's not, It's not ownable. Like, and that's what people need to figure out. And a Satoshi is only ownable because of this delicate game theoretical construction that is Bitcoin, that is this game theoretical agreement between people.

That's the only reason that the Satoshi has value in the first place. And when you clog that with other crap, you're just making that Satoshi that you just thought you bought the fucking monkey picture with. A little less valuable in the long run.

Mechanic: Yeah, it's, it's complete corruption, and it wasn't ever a part of any of the discussions. Like, if we're honest with ourselves, it just wasn't. The whole justification and rationale [01:07:00] for, you know, 21 million bitcoins is important. Limiting block space is equally important. And when Gavin Andreessen and those guys came around and said, you know, make it bigger, we said, that's just as degrading as saying let's go above 21 million, like you're really, you're degrading a fundamental constant in the whole network, and who cares if Satoshi arrived at it by accident or whatever, this, like Adam Back says, it's genuinely surprising that all these constants, if you move them in either direction, you degrade everything,

Knut: Is it like saying if we make pi bigger, we can make circles bigger?

Mechanic: well, it's not, it's not quite exactly like that, it's just when you trade off the, What, what would happen if you made things smaller or bigger or, you know, went smaller or bigger than 21 million, you know, you degrade things vastly, even if you help something else, you make something more important worse, right?

Scarcity of Block Space

Mechanic: So, like, block space being a fundamentally scarce resource, the implication with that, that I thought that was basically, [01:08:00] You know, uh, wasn't, that went without saying because we barely discussed it back in the block size wars was, and all this block space is going to be used by genuine financial activity.

It's not going to turn into a generic database. That was the assumption. No one, that was never part of the discussion that, oh, minor income that's sort of, you know, we need to guarantee minor income in the future beyond subsidy. How are they going to guarantee transaction fee revenue with infinitely large blocks?

Why would anyone pay to store data in a database that's infinitely large? There's no re, there's, the motivation isn't there. There needs to be a competition for space in the block space, which means you need to artificially limit it. Reasonable, but opening it up for other use cases to help ensure that was not a part of that discussion.

And it doesn't, it's shoehorning itself in now as a rationale for inaction and apathy. And people say, look, I don't want to be in core of being as they always are, which is, we don't want to make political decisions of this nature. [01:09:00] So that, that creates status quo bias, which is obviously fallacious, but suddenly you have the blockchain being used for an unintended purposes that there's a competition about the type of.

Data that goes into it. Not, not. It's not a competition. Like, oh, this guy makes a bad transaction and this guy makes a good transaction and will prioritize good and bad, and we'll exercise moral judgment about economic activity. That's not what we're doing and that's what people are characterizing it as we're saying.

This type of data does not belong in the blockchain. It's not a generic data storage platform. It's not. That's not what it's for. It's for financial activity, and financial activity does look different. It is definable in a practical sense. Yes, there is arbitrary data that can be genuine financial activity, and there is genuine financial activity that can look like arbitrary data.

I understand that. You can't make an objective line between the two. But you [01:10:00] can come to a fairly consistent set of subjective, you know, you can have a shelling point of subjective consensus where you can say as a network, let's stop gaslighting ourselves. We know what the attackers are doing. We know what envelope they use in here.

We don't need to play too many games of whack a mole. We can just say, right, you are a bunch of spammers, you're selling absolute nonsense, you have raised millions of dollars, you've done so much marketing, you've got enough idiots thinking that they can get involved in this and it's the next pump and dump.

All we need to do is hit that over the head and you have to start again. You need to actively advocate all the same things again to a bunch of VCs that know what you're advocating for is to build and flesh out a system on a network that's openly hostile to what it is you're trying to do when there's all these other alternatives.

So what we're really saying to you is, go and do your thing on another blockchain or use a private [01:11:00] database for it, which is actually designed for it, because ordinal interpretation and ordinal theory, is a private thing that's established in a centralized fashion. Just have them maintain the database.

Don't use Bitcoin's blockchain for it. If you're really serious about this thing, go and do it that way. Don't keep trying to do it on a network that's going to keep bashing you over the head and telling you to go away because they can do that once or twice with mempool filters. Which doesn't require a long, years long process of, you know, soft forking this stuff out.

You can just say, eh, we don't like this stuff, we're going to make it difficult to relay around the network. 95 percent of networks, uh, nodes do it, because all those nodes, you know, use core default policies, and core actually wakes up and, you know, starts updating the mempool, you know, the spam filters.

And then at that point, you have a few miners that want to make a few extra bucks who You know, uh, doing something which has been now understood as an attack on the network and other miners stopped [01:12:00] doing it. And then, as far as I'm concerned, the spammers are going to, they're going to melt, because what do you do in that situation, how are you going to raise the money, how are you going to do the marketing, how are you going to get momentum, uh, doing this stuff on a network that keeps telling you to go away, when there's all these other, more efficient options, why keep up the pretense of being immutable, because your, your ordinal theory has some, element of encoding data on the blockchain when in reality you can change the rules in 10 minutes and then no one has their ordinal anymore.

Like, it's it's not it's not hard.

The Attack on Bitcoin

Knut: The devil's advocate, controversial, somewhat controversial answer to all that, why, why, why, is because it is an attack on Bitcoin. And that was the purpose to begin with.

Mechanic: But what surprises me about that then is how many people are falling for it. If you treat this thing as an attack you can solve it in 5 minutes. But if you, if you refuse to acknowledge it as an attack, if you're going to gaslight everyone and pretend that we just got to put up with this and oh, they'll be priced out [01:13:00] eventually even though the opposite's happening, where do you go from there?

I don't know. Like, it just requires education and talking endlessly to people. Like, I did a podcast with Preston Piech and

Knut: Yeah, I heard it. I listened to it.

Mechanic: Yeah, a lot of people, like, my thinking on this has evolved a lot since that podcast, and a lot of people have messaged me like, yeah, I wasn't really sure before, and I definitely agree with some of the perspectives you had on there, and, uh, I think, you know, this apathetic approach that we've been taking isn't actually a The smart move here.

And I think, I think the conversation is moving. Things don't have consensus in Bitcoin automatically. I was a big blocker at one point. Most of us were. Most of us looked at what Gavin was saying and thought, yeah, how are we going to scale this thing with one megabyte blocks? And eventually the truth won out and we realized this isn't a good idea.

And the people that stuck to their guns ended up all writing themselves out of the script. Roger Ver and Mike Hearn and Gavin and all these people, they just ended up They stuck to their [01:14:00] guns and they got excommunicated through their own frustration or whatever, or just through sheer embarrassment. The same thing can happen here.

Ultimately, as you pointed out, who are we kicking out? F heads, BS vs. Openly hostile attackers that describe what they're doing as deliberately harm hurtful to the Bitcoin blockchain. They're not, they're not. They're not hiding this stuff. They're like, I am going to store my JPEGs on your node and there's nothing you can do about it.

This is, this is like a hostile language. They're deliberately violating the consent of node users. And I'm sorry, I'm not going to sit there and just be like, Oh, what is a valid transaction anyway? That is just so. Uh, that's so naive.

Knut: Yeah, they're actively saying we broke Bitcoin and stuff like that.

Mechanic: Yeah, like, some of this is like to create, you know, buzz and to annoy people and to market, you know, it's called outrage marketing, but others of it, like, there's Mike in Space tweeted saying like, hey, let's, what's the cleverest way I can do this? [01:15:00] Inscriptions are more efficient than bare multisixpam. What if I bloat the UTXO permanently, the UTXO set permanently, with multisixpam, this stuff still defaults to on for the, you know, for most Bitcoin nodes.

Notts doesn't, but Core does. So, you know, and he's sitting there sort of calculating it, going, how can I make life difficult? How can I create the biggest bang here? How can I annoy people as much as possible? And this is so harmful, right? Like, no one has a problem with Gmail. Getting rid of a Nigerian Prince, you know, email scam.

And that's one person that's inconvenienced you, right? When someone stores a bunch of bare multisig spam on your node, that's every single node for the rest of time has to store this crap. The, the, the, it's exponentially more harmful. And no one minds spam filtration on a, in a centralized, you know, person to person basis.

But when it comes to Bitcoin network, the need to filter spam and be rigid about what ends up in the blockchain is so much [01:16:00] more important. It cannot be neglected. No way. I have strong opinions here, guys.

Knut: Yeah, yeah, yeah, but we're trying to do our part here in calling a spade a spade. And trying to explain this to people. I know a lot of these episodes have been slightly more on the technical side, but I think we've been able to explain, straighten out the question marker. or two. Luke, do you have anything on your mind for, for mechanic, Mr.

Mechanic here?

Bitcoin Mechanic's Freedom Footprint

Luke: Well, the first thing I'll say is that we are taking a stand. I think anyone listening to this show should understand that Knut and I, we've talked about this ad infinitum. We are taking a stand on this thing. This is, this is not negotiable. We, we really do side with Ocean and against ordinals and all of this because it's obvious it's clear and it really is a moral issue if you're on the side of ordinals you are acting immorally [01:17:00] and you are against bitcoin and against freedom and this show is called you The Freedom Footprint show, and we're doing something a little bit diff well, not different, we're this isn't going to be different in the future, but this is the first time we're actually intentionally asking this question.

The Freedom Footprint concept is the idea that you as an individual can do things that expand the amount of freedom that you put out into the world, and you expand the

Knut: Freedom Dioxide. The amount of Freedom Dioxide, yeah.

Mechanic: How dare you? That was a Greta Thunberg gif, I need to

Luke: Perfect. Perfect. Well, exactly. And so that's kind of the point here. And so now I think we've, we, I don't know why we didn't realize this in the future, but the question we should have been asking this entire time to every guest is, is what I'm going to ask you just now, mechanic, what are you doing to expand your Freedom Footprint?

And I know the answer is obvious based on everything we've said, but Please, Knut, just [01:18:00] humor us and answer that question.

Mechanic: In the short term, working at Ocean means that miners have more of a say what goes in the blockchain. Because we have multiple templates. We still offer the spam template. Um, I can sort of divulge that basically no one is using it, which is beautiful, because it squashed all this fud around censorship, which is obviously nonsense anyway, but I said, alright, here's the thing you all apparently want, and no one used it, so that was a lot of fun.

so we're basically saying if you care about what goes in the blockchain, miners tend to decide to forego the theoretical extra spam revenue and actually do something that isn't actively as harmful. That's, that's definitely, that, that allows for a more. Reflective and free open market for block space amongst the people that are using it for its intended purposes.

So, I like the chess club and checkers club analogy, right? You don't, you make the chess [01:19:00] club and people show up with a basketball or whatever and start making it unusable for the chess players. That's not freedom, because you're not free to play chess anymore. Like, freedom is the freedom to play a game in which the rules will not be changed.

Freedom is not Anyone can change the rules all the time because that's fiat, and that's, that is how you enslave people, is you put them on a treadmill, you work them towards a goal, and then you move the goalposts. That's not freedom, that's slavery every time, because you can't work to everything. You need to create a game with rules, where the rules cannot be changed, and that's liberating.

You create a confine and you say, this confine will never change. That's why the 21 million is so important, right? Because if you change that 21 million number, that's freedom! Someone had the freedom to change that number, right? But it really just undermined everyone working towards their own individual sovereignty,

Knut: Yeah, we would have to print new t shirts, it wouldn't work at all for us.

Mechanic: Yeah, tattoos would have to be removed at this point. So, [01:20:00] yeah, so that's, that's short term what I'm working towards. Long term, we're working towards miners having the freedom to mine in a pooled context, which means they solve their cash flow issues that come with solo mining. Without having to have templates imposed on them by pools who are saying, yes, we'll let you mine in a pool.

Yes, we'll let you solve your cash flow issue, but your blocks must look like this. You are just a hasher. You are not a miner. We are turning that upside down and saying, miners, you now, we are economically incentivizing you to run a node To build your own templates and to become a full Bitcoin miner again without the one issue of never, of not being able to mine in a pooled context.

So you have to wait years until you get a reward. That's not viable. So we're saying we want to be a pool, we understand collaborative mining, but we want to minimize and disintermediate everything about what the pool does. Here's the Bitcoin network, here's the miner. At the moment they [01:21:00] are worlds apart.

What Ocean wants to do is say All we do is navigate and define the split of rewards. So you, you did 66 percent of the mining, you did 33 percent of the mining. You get two thirds of it, you get one third. That's our job, to do that transparently. It is not our job to say, these are the correct transactions that go in the blockchain, those aren't.

And this might work against the anti spam. Movement. These are, these are different kinds of goals, but I guess, uh, like this is also quite difficult to explain to people, like, why are you, surely Ocean would be much more effective in its spam, you know, hostility, if you just forced all your miners to use an anti spam template, but no, there's the deeper principle here is miner freedom and miner sovereignty, and I will definitely prioritize that.

Thank you. Over my, my stance on spam, but I think they're parallel wars and we can win them both at the same time. It's no coincidence that the people pushing for freedom that might work against their own goals of spam [01:22:00] filtration are also the ones pushing against spam. So when people connect those two dots I think, you know, it's going to make sense.

The people that are not into freedom are also the ones forcing everyone to mine spam right now, so I think people are going to ultimately go, freedom is the freedom to use bitcoin without spam. It's not freedom to let anyone use the network in ways that destroy it. That's not freedom. That's just what it is.

That's just, that's what most people's concept of anarchy is, you know, that mistaken concept people have when they go, oh, this is pure anarchism when, you know, a city is just burning itself to the ground. It's not anarchism as philosophers would describe it or libertarians would describe it, but you know what they're talking about, right?

Like, just lawlessness and a disregard for anything beyond the next 30 seconds. That's what Bitcoin is like at the moment. No one cares about it long term. They're disregarding the future health of it and they're going, all right, just burn, you know, tragedy of the commons, ruin it, everyone else is going to ruin it, I can make more money if I ruin it faster than them.

That's not [01:23:00] freedom. That is, that is not low time preference at all. So yeah, that's my, that's my answer.

Knut: That's very fiat. We wish

Mechanic: fiat.

Knut: providers would look out for miners instead of miners on an island somewhere. As that country singer would have put it. there anything else you would like to add to this mechanic? Like, about something else? Or, like, some avenue we haven't been down yet?

Like, are you coming to Madeira, for instance?

The Ocean Launch

Knut: Sorry I couldn't make it to South Carolina, but, like

Mechanic: Well, as long as you regret it, then we're good. As long as you regret not going.

Knut: I definitely regret not going. I was fucking crying here watching the live stream.

Mechanic: It was great. I had a few people tell me, like, Gary Leland said he's been going to Bitcoin conferences for 10 years and he's never watched a whole presentation, let alone a presentation. every [01:24:00] presentation back to back. He's like, I didn't, I didn't go outside and talk to anyone or anything like that. I watched every single panel and listened to everything said on every panel.

He's like, that's never happened to me at a conference before. And I agree. I, every conference I go to. I don't watch anyone on stage, I just go and talk to people, because that's sort of the whole point, right? And if there's a really good talk, I'll go home and watch it on YouTube later. But, like, him, he's like, no, I watched every single one, it was fascinating.

Knut: It was like that for me. I, well, I didn't watch all of it because I came in that last section there. But as long as, just after you started talking, I couldn't stop. Like, I had to watch the entire thing, of course, and Luke's and Jack's announcements and everything. Like, it was great.

Mechanic: Well, the hydroelectric plant was really cool as well. There's, I don't know if you spoke to Bob about it when you had him on here. Did he tell you,

Knut: No, no, that was before the Ocean announcement,

Mechanic: Ah, I see.

Knut: yeah, like a month before or two.

Mechanic: Oh no, he bought, that plant's, it's almost 200 years old, that [01:25:00] plant, it was from 1850,

yeah, it's super cool, a whole megawatt, and some of the generators in there are staggeringly powerful, like, just stunning.

You can run, what, 300 bitcoin miners or something off that. Is that right? I

Knut: of a megawatt.

Mechanic: Yeah, I think so. Yeah, it would be a thousand if a Bitcoin miner used a kilowatt and they used three times that. So yeah, you're around 300 Bitcoin miners, which doesn't sound that impressive, but they do use an unbelievable amount of electricity.

So

Knut: Yeah, yeah,

Mechanic: yeah, I don't have anything else pressing. Yeah, I don't have anything else on my mind particularly.

Knut: alright, where can, where do you wanna, um, find, where do you wanna direct people to? Ocean. xyz, obviously, but where else? Is there anywhere else you wanna direct people?

Ocean.xyz

Mechanic: Yeah, ocean. xyz is, you know, where you can go click on dashboard and you'll see what our hash rate's doing. It's been, it's been trending up a lot. and that's good, because there is a [01:26:00] minimum hash rate you need to be viable as a pool, which is another sad limitation of Bitcoin. You can't have thousands of pools, it just doesn't work, because then everyone is solo mining that's on those pools, essentially.

But a pool needs to be of a certain size, and we've had a baptism of fire. Because our pool has been very low hash rate, which means it's very hard for miners. At one point, they waited over three weeks for block number three, which is a long time to go without a payment. And when you get the payment, it's not a much higher payment because of how long you waited.

It's just however much was in that block. So, you know, um, we're around 88 percent luck at the moment, so we're around 12 percent below. Uh, you know, average luck, but that's gonna, that we're going to deviate wildly from a hundred percent because of how low our hash rate is, but it's trending up and getting better.

So that's all that matters. As long as it's moving in the right direction, that's all that matters. So that's OceanXYZ, definitely mine with us. If, if you're interested in mining and you're a Bitcoiner and you care about the long term health of the [01:27:00] network, I can confidently say there's nothing else that's a remotely good option.

In the mining space, beyond solo mining, but that's no good for most people anyway. Um, you can find me on Twitter, I'm at grassfedbitcoin. obviously I'm a carnivorous meat enthusiast and my other half has cooked some ribs for me overnight. She slow cooked some ribs, so I'm super excited to go and eat that now.

And, uh, I don't, I don't think I have anything else really. We've got like Discord and Telegram, support chats and all that stuff with some pretty vibrant communities. Uh, if you post a picture of a block when we didn't actually find a block, we'll definitely kick you out of the chat for that, for ruining everyone's day.

Uh, a couple of people did that. Um, yeah, that's it. That's it. That's all, that's all I really got on my mind right now.

Knut: Great. Looking forward to see you whenever, whenever the next opportunity comes and to jam and to do a lot of fun things.

Mechanic: Thanks guys. Thanks for having me. And I'm [01:28:00] really, uh, it's really nice to, to be among sort of people, well, definitely people on the right side of this new war that's emerging. It should be pretty trivial, but there is some, there is some, some mess and some ideological confusion around and, you know, anything you want to do to correct narratives around that.

I saw Knut that you wrote a post about, you know, uh, if there's a service designed for purpose A and people start using it for purpose B. That you don't just go, oh, freedom, like, and I had made this analogy a few times, I made a similar one myself, independently of you, about like a bus service, where FedEx figures out they can use this bus service to ship parcels around really cheaply, and then all the buses in the city are full of cardboard boxes instead of people, and everyone's going, oh, it's freedom, how do you define what a cardboard box is versus a human, what if someone goes on with a backpack, are you gonna ban them as well, like, and I'm saying, look, Luke Jr.

is sitting down there in the engine room of the city saying, no one can get [01:29:00] around the city. I don't care about the philosophy of it. Like, the bus isn't doing its job, which is to get people around. It's not to become a parcel service. Like, can we just fix this? Like, if you're a cardboard box, you can't get on this thing.

Like, it's just that simple, right? There's no philosophical discussion necessary. That's just distraction. Like, and well, which is weird for a podcast like this, that's mostly philosophical in nature, but. You

Knut: think it is highly philosophical. I I just think this, that, that's, uh, what the other side is doing. here, if you can even call it the, even calling it the other side is like, what, what the scammers are doing is that they're, they're promoting false philosophical insights, which aren't really insights at all.

Mechanic: we call it whataboutism, right?

Knut: yeah. What about is and, uh, yeah, just plain lies about and, and, uh, semantics like, um, there. Their version of censorship, they're interpreting the word wrong. Censorship requires coercion, [01:30:00] like otherwise it isn't censorship, right?

Mechanic: I think, I still don't know how to define it exactly. I think coercion is a good, uh, starting point, though I think censorship can also be voluntary compliance with government crap. Like, it can be,

Knut: Yeah, but that is coercion. If it's compliant with the government, it is coercion.

Mechanic: It's hard to see that as anything other than coercion because it can be presented as, as voluntary, right? They can say, hey, if you, if you, if you're OFAC compliant, we will give you a tax break or something like that. But all that is, is, uh, like we will coerce you less if you allow us to coerce you in another way.

Knut: it's voluntary with a gun to your head. Like, it's not consensual, it's voluntary. That's, that's the difference between the two.

Mechanic: Yeah, so I, I consider it's, it's not just governments that can coerce. So if, if we're going to get bullied into putting stuff in our templates that we don't want, that is censorship. Because you don't have infinitely large blocks. We have to forego genuine financial transactions to put in the spam [01:31:00] that you're forcing us to put in.

That's way more consistent with the definition of censorship as I understand it. So, yeah, in my mind it's FUD. It's total FUD. And it took us, it took us a long time. Like, we had a lot of people stressing out, like, what's going on with the censorship? Like, how, how are you doing this in Bitcoin? You must be attacking Bitcoin, right?

You're censoring transactions. This took weeks to sort out all this mess, right? You know, what is it? Like, lies make it around the world while the truth is still putting his shoes on. Like, it was, took a while, but I think we actually did it. Because the hash rate's going back up now. Every time I see people sort of go, you know, uh, there's this, there's one guy I accidentally upset in the spaces the other day, who's like, uh, He takes himself very seriously.

I'm not going to say his name because he's probably gonna sue me at this point. He's had a multi day meltdown because, uh, I, I made a sort of slightly offhand comment about him being confused about inscriptions and he went insane over it and is telling everyone, [01:32:00] nevermind with Ocean, I will pull all my wealth out of your stocks and all that stuff.

He went

Luke: I know

this gentleman.

Knut, you

probably know as well, yes.

Mechanic: it's so the guy's like having a real fit about it, I don't want to invite more drama, like, as a pleb I can do this stuff, as, as a representative of Ocean, I can't invite active, like, hostile people that are gonna start throwing around lawsuits and stuff like that, it's just irresponsible, but nonetheless, when he started sort of accusing us of censorship, it was really nice to watch everyone respond and go, I think you're just personally butthurt over a comment, you Like I made, I don't think anything about this.

And do you know what censorship is? Like everyone is just on it now. When anyone's going ocean census transactions, I see like 90 percent of responses, like go back to school, learn what censorship is, appreciate the freedom miners have to include what they want in blocks, stop trying to force people to include malicious stuff in the blockchain, like go and [01:33:00] look in the mirror, like it's been really nice to watch that change of.

Um, you know, heart. And even some people that formerly attacked us have, have had a change of heart and gone, Oh, I actually get this now. So the truth is winning out and I'm really happy about it. And like the camaraderie I feel and this, the emergence of another war in Bitcoin is, it's beautiful. I know that I'm going to be sitting down with you guys in 10 years in a pub somewhere in some beautiful location where a Bitcoin conference is and just looking back at this and going, yeah.

I'm remembering every detail one by one like, do you remember when Ocean launched? Do you remember when this happened? Like, I think it's going to be a really nice moment to look back on.

Knut: Fantastic. For lack of a better word, amen, brother.

Mechanic: All right. I'm not, you did that with Jimmy Song. I'm definitely not going there on this.

Knut: No, no, no, I'm not going there either. I'm not that interested in having that debate, to be honest, I like, I like, I like getting along with people better than, than fighting them over stuff that doesn't matter [01:34:00] for, for Bitcoin.

Mechanic: Yeah, fair enough. I don't, I think it's a out of band, definitely an out of band discussion.

Knut: Yeah, we should, we should do that, uh, in that pub in 10 years from now, or hopefully a bit earlier than that.

Mechanic: Yeah, I hope it doesn't take 10 years to get rid of the spam. I'm hoping it's another few months. I think you have this, uh, we keep establ we keep dragging this out. I'm sorry to anyone listening that feels like, you know, they need

Knut: think they appreciate it.

Mechanic: Yeah, well, I think, I think, like, I think ultimately, uh,

Knut: the show.

Mechanic: yeah, let's just fill it up with unintended stuff.

I mean, look, I think ultimately we're a few months away. I think Ocean is sort of, there's this beautiful synchronicity that Ocean is around and this option for spam filtration while spam is suddenly, you know, bashing us all over the heads with how much of a problem it is. Like, if we were trying to solve the spam issue without the context of the spam, you know, campaigning [01:35:00] for updated spam filtration inside, you know, the core default mempool policies.

If we were trying to do that in a context where there wasn't any spam, how would this conversation progress? I just, it would, you know, it would be on the mailing list and there'd be like, it'd be a very academic discussion and there'd be no movement on it at all. Like, it would be like it was, actually, the pull request for Bitcoin Core to default bear multisig to off is from 2014.

And you've got Luke in there saying, this serves no purpose, turn it off, it can be used for spam later. And there's a couple of whataboutisms in there. from, amazingly, uh, Peter Todd, Mike Hearn, Ryan X Charles, and um, one other person that became, you know, a Bcasher or a BSVer. Like, they basically all wrote themselves out of the script.

I think Jeff Garzik weirdly was in favor of turning it off, but he turned into a Bcasher later on anyway, or He would, no, he was the Segwit2Xer, not the Bcasher. But the point is we had it back then. It was [01:36:00] a theoretical discussion where most people went, uh, just leave it. Maybe someone uses it for its intended purposes once.

I don't see any spam, do you? And now we're like inundated with stamps crap that's permanently bloating the UTXO set and we're revisiting that, that PR from nine years ago saying, uh, it's time to turn this on, what were we thinking back then, and I'm just saying. The context in which we're fighting spam is a context in which we are completely inundated with it.

That's helpful, because we can point to it and say, look. And this is my favorite thing about the OCEAN website, it shows you visualizations of the different templates. And, um, the core default template that doesn't do any spam filtration has You know, uh, we have blue for the, for the real transactions, and poop brown for the, uh, for the spam transactions, and they are, it's the exact hex code for poop colored brown, and, uh, yesterday we started working on turning them into poo emojis instead of [01:37:00] actual, you know, Just brown.

It will actually be poo emojis. And I'm thinking this has got to be useful when you're selecting a template with ocean, if you've got to select the one literally full of shit, if you've got to select that one, I'm going to, I'm going to mine with that. How much I make 3 million more sats divided amongst.

The 400 of us mining on this pool, that will result in an extra 7 every 19 days, or whatever the calculation, and then I have to knowingly fill up the blockchain with actual crap. I'm confident that most people are going to go, this isn't worth it, this is a bunch of FUD, like, this spam is nowhere near worth it.

I'm gonna mine the other one. Oh, and the pool charges me 2 percent if I use the spam template and 0 percent if I use the filtered one. Why am I gonna do that? I'm actually gonna come out economically worse because it doesn't even amount to 2%. I'm gonna pay more in fees to the pool for selecting spam.

Like, so someone would have to be, in principle, in favor of the spam to their own financial detriment to [01:38:00] actually go that way. So you'd have to be philosophically completely gaslit. And interested in earning less money to mine with Ocean and mine the spam. So that's why no one's done it. But like, it would be really funny if like, yeah, we're gonna get the poo emoji, we're gonna get the litter floating around in the ocean, you know, the plastic straws or whatever it is that's so bad for the ocean, we're gonna put all that in there, try and avoid any of the environmentalist tropes, keep to the valid ones, maybe an oil slick.

What do you think? Should we have just an oil slick of spam floating around?

Knut: We were with the Tall Ship in Santo Domingo once, uh, you know, um, uh, in the Dominican Republic, uh, uh, and, uh, the river that flows out there was completely filled with garbage. A dead, bloated dead horse and stuff, all sorts of crap that floated by, so it's like, go to one of those rivers that are polluting the oceans [01:39:00] and take a couple of pictures and you'll find what you like.

Mechanic: So like your question earlier, like if I can answer it again about what I'm doing for freedom, I think you can't have freedom without responsibility and anyone watching a river in the Philippines or wherever it was you said, just as flowing with garbage, there's someone that's been completely irresponsible to do that.

That's like, yes, it was free. They had the freedom to dump all their garbage in there. Hooray. But they were also completely irresponsible. And if you're irresponsible, your freedoms don't last. So have some low time preference. You exercise judgment within, you know, the context of being allowed to do what you make your own judgments.

Like you make good judgments if you're allowed to make them at all, I guess is the sort of the moral lesson here, right?

Knut: absolutely. And to sum up, to paraphrase Robin Williams, uh, block templates are like diapers, they should be exchanged often and for the same reason.

Mechanic: [01:40:00] Alright. I like it.

Wrapping Up

Knut: Alright. Thank you very much, Mr. Mechanic, and I hope to see you soon again. This has been the Freedom Footprint Show. Don't forget to like, subscribe, and brush your teeth, and change your, uh, minor to, like, direct it to Ocean.

Mechanic: Yeah, definitely come on with us and we'll, we'll give you good support.

Luke: Fantastic. This has been the Freedom Footprint Show, as Knut said. Thanks for listening.