Peter Todd on the Essence of Bitcoin


Peter McCormack: Hi there, Peter. How are you?

Peter Todd: I’m great, thanks.

Peter McCormack: Thank you for coming on the podcast. I’ve wanted to talk to you for quite a long time. I followed a lot of your work. And, one of the things that really stood out for me is when I went on your blog, and not only did I not understand the content of your articles, I didn’t even understand what they were about.

Like there’s a certain level of technical competence that I think you have to have to kind of understand this work. And, I then read about a story that you were emailing Hal Finney and Adam Back when you were at like 15?

Peter Todd: Yep.

Peter McCormack: I’ve got to ask about this. What’s the background? How does a 15-year-old start talking to Hal Finney and Adam Berk about Hashcash? What’s the journey to that?

Peter Todd: Well, the great thing with the Internet is, no one knows that you’re dark, and even when they do, they don’t care. And I mean, if you go back far enough, as a young kid, I watched a lot of Star Trek and thought the ideals of democracy and freedom of speech, they’re all said and well and good.

And, my dad’s an economist by training. So initially, really early on, I got interested in the freedom project, which is a decentralised censorship resistant publication network. Long story short is, it lets you make a website that no one can take down, lets you publish.

And I thought, “Oh! That’s really cool.” And, got interested in it, did a little bit of work on it. So actually, first time I kind of worked on creating an exploit, was actually against Freenet. The work I created a tool to go and map out the interconnections of different nodes, so those are all well and interesting.

But, I think the big issue with Freenet network, was, as I was thinking to myself, “Well, obviously the next step is you need decentralised money. Just being able to publish your thoughts isn’t enough. Political movements need money. Take a look, political movements for the marginalised, the poor.

If you’re a rich person, you have the way of funding the things you need to fund to make your political movement happen, whereas the poor don’t have that. We are often kind of talking about it in reverse, the rich will gain politics, and so on. And, reality, I mean you can’t kind of stop that. But, for the disadvantage, you definitely need that option to be able to move money around. You need to be able to without surveillance.

So, I think long story short is, somehow or another, I wanted upon a mailing list, the Blue Sky mailing list, which if I remember correctly, it was advertised on the Freenet mailing lists. So, I signed up, we started talking about stuff, and I spent a lot of time trying to invent Bitcoin, and like many people completely failed at it.

And, it’s really interesting looking back and seeing just how wrong I was, in almost 180 degrees offset what was the right answer. And, a lot of people, I think, had that experience.

Peter McCormack: So you tried to invent a Bitcoin?

Peter Todd: Yeah. I was one of many, many people trying to create decentralised currency. And, really failed at us.

Peter McCormack: What was version?

Peter Todd: Well, I think … I mean, I didn’t have a proposal, ’cause I realised all my thoughts on it weren’t going to work. But, I think what I caught so wrong was I had thought about Hashcash in terms of the thing that controls the creation of money. And, that’s not actually an important thing. The creation of money is not the important thing. It’s preventing double-spending that is.

The creation is just a onetime event. Allowing money to be moved consistently, and accurately without double spend, is actually the critical thing. And, unfortunately, because I tied proof of works to the creation so tightly, I never really came up with the concept of, “Well hang on.” No, no. We tied proof of work to the changes in the ledger, to make sure it’s difficult three or at the changes.

Peter McCormack: Right.

Peter Todd: And, my thinking on my kind of solution where we have some kind of decentralised database, how do you do that? I don’t know. It can be attacked, it can be civil attacked. And, I just constantly shot down ideas, and could never figure out, how do you make this work, when the answer was juts so simple. But, it was 180 degrees opposite what I was working on.

Peter McCormack: But, I’m guessing you’re saying it’s simple ’cause the answer was Bitcoin, right?

Peter Todd: I mean, literally someone could have sat down … Like honestly, it’s to the point where one tweet from the future, saying how Bitcoin works, would probably have been enough info for me to have created Bitcoin.

Peter McCormack: But, what is the key, the one key element then?

Peter Todd: Using proof of work to make changes to the ledger difficult. That one sentence, I think, encapsulates the key part of Bitcoin that we were missing back then.

Peter McCormack: So, it’s more the game theory than the code?

Peter Todd: I don’t even … The point is, I don’t even think the game theory part is a really critical thing. Like, absolute core of it that you must have is tying proof work to changes to the ledger, to make it expensive to change. You could probably have Bitcoin without even a financial reward. It would still work far better than any of the crazy ideas people had come up back then.

Peter McCormack: So, the Bitcoin white paper comes out, you’re obviously are aware of it, you read it. Is it obvious at the time or?

Peter Todd: Absolutely.

Peter McCormack: Oh, immediately you could?

Peter Todd: Yeah. For me, I believe I read the Bitcoin white paper for the first time, like late 2009. And, I remember, you know when I read it, I was like, “Oh, shit! I should’ve thought of that.” It was actually, for me, it was opposite many people.

For me, I read it, and this is obviously gonna work. And, only later did I come up with reasons why it wouldn’t.

Peter McCormack: Right.

Peter Todd: Whereas, for many people, they read and think, “How would this ever work?” And then, later they’re convinced it does. But, I’d been primed, ’cause I’d already worked on this and tried very hard. So, when I saw it that’s … It just was so obvious to me. “Oh, I was wrong. This was the missing piece”

Peter McCormack: How, as a 15-year-old, do you make the leap from realising that there is a need for money to finance certain projects and things, to it must be having to be a decentralised type of money that doesn’t already exist? How do you make that leap?

Peter Todd: I mean, the idea of e-money and cypherpunk stuff around that was not exactly like an unknown concept. I partly even read Sci Fi stories at the time talking about that. The notion of credits is really sort of a common term in Sci Fi stories. I mean. it’s just …

And also, money itself has a property. I mean, sure, it’s issued by the government, but paper money I can give to you, and no one can stop me. The idea that money would have to be controlled on transaction basis is this very new thing, pushed by big companies who want to go make money off this, and Law enforcement who would like to surveil everyone. This is the opposite of how money should work. This is not the status quo.

Peter McCormack: So, this Bitcoin worked then, or is it working?

Peter Todd: I mean, in terms of doing what money should do, it’s a hell of a lot closer than say PayPal. It’s a lot closer to what PayPal was meant to be. I mean, people who started PayPal wanted to create censorship resistant e-currencies. They didn’t have the tech to do it, and they didn’t have the legal frameworks to get away with it.

So, they didn’t. But, that was the initial concept with PayPal. So, Bitcoin’s a lot close to that. I mean, Bitcoin has scaled boldy problems. But, the core thing of what Bitcoin does is much closer to that than alternatives, certainly closer to things like Liberty Reserve, which of course got shut down.

Peter McCormack: Yeah, I guess there’s always been the centralised problem, right?

Peter Todd: Yeah. Centralisation kills things if they have adversaries. Often centralisation’s way to go. I mean, I have approached it myself, called Open TimeStamps, which is absolutely centralised. There are four calendars of the Open timeStamps system. I run two of them, two other people run another two.

It’s a centralised system. But, Open TimeStamps doesn’t really have adversaries in this way that Bitcoin does. And, no one’s going to profit by shutting down Open TimeStamps in the way you would with Bitcoin.

And also, because Open TimeStamps relies on Bitcoin for the truth of the timestamps, the central third parties on a position to fake things.

Peter McCormack: Okay. So, I wanna … I should’ve asked this at the start. I love asking this question, ’cause it’s so simple. And, the first time I heard it was when Epicenter asked Adam Berk, and it also blew my mind, just hearing it set out. So, I’m just gonna ask you again. What is Bitcoin? The answers are always different as well.

Peter Todd: Well, I’ll give you a different answer.

Peter McCormack: Okay.

Peter Todd: Which is, Bitcoin is a shared data structure, that we make artificially expensive to change, by destroying energy every time we update it.

Peter McCormack: Yeah. I’ve heard that one like four times. No. I’m joking. Yeah. I’m only joking. Okay. Okay.

Peter Todd: Bitcoin is an elephant, and it’s pink with like little spots.

Peter McCormack: I love the energy angle. So, you’ve been around since the start, right? It’s 10 years and-

Peter Todd: Not quite.

Peter McCormack: Pretty much.

Peter Todd: I mean, I’ve known about Bitcoin, since nearly the start. But, I actually got more active into it a bit later. And, the reason is, I mean, relative to many other developers, but the reason is because when I first learned about Bitcoin, well, I’d just started a new job at a crazy startup. And then, I was crazy enough to then also try to do a physics degree, while I was at the startup. So, I didn’t exactly have a lot of free time.

Peter McCormack: But, I mean, I’ve gone through the exercise of going through old mailing lists, and old Bitcoin talk forums. And, there’s a number of names I recognise. A number I don’t. And, I’ve seen you in there commenting and talking. So, you were there like pretty much since the start.

Peter Todd: I mean, I started working on this stuff full time 2014.

Peter McCormack: 2014.

Peter Todd: Which is a lot earlier than many people.

Peter McCormack: But, having been there, through the whole experience, how do you take it all in, because even though you knew it would work, there’s a difference between knowing theoretically it would work.

Peter Todd: Well, remember, I thought it would work.

Peter McCormack: You thought it would work?

Peter Todd: And then, I started realising, hang on, this isn’t as good as it sounds.

Peter McCormack: Right. Okay. We’re going to come back to those things. But, 10 years on is still exists. It holds billions of dollars in value. At one point, hundreds of billions. There is the talk of ETS. We have futures. We have so much happened. Did you foresee all this?

Peter Todd: I mean to be perfectly honest, this it doesn’t really surprise me that much. I mean, you always gotta be a bit careful. I mean, your memory of what you thought five years ago can be a bit vague. But, I don’t think if you’d asked me that many years ago, would it? Could it get to where it is now? I would have said no.

I think I would have said, “Yeah, I mean, this is plausible. It is an obvious utility. Digital gold is obviously useful. So, if things don’t fail and it continues to grow, I mean, surely could get to this point.”

I think the more interesting question is, well, how big could it get? And, I would actually put relatively small limits on it. We’re not gonna see … First time I bought Bitcoin, I bought it for 20 cents of a Bitcoin.

Peter McCormack: Right.

Peter Todd: And, I tell you, that was the best financial decision of my life. The worst financial decision of my life was only buying $20 worth.

Peter McCormack: Hold on. What is that? That’s like a hundred Bitcoin. Yeah. But, we won’t have hindsight.

Peter Todd: But, the thing with that is looking at how that grows. I mean, how many zeros is that times? Call it 10000 times growth or whatever, depending on what price you pick. We’re not going to get another 10000. The world economy is too small for that. We’re not that far away from having more money in Bitcoin than in the US dollar and gold combined.

Yeah. That’s if I remember correctly, it’s like a hundred X. That’s pretty … That’s a lot smaller than 10000X.

Peter McCormack: Yeah. But, I’m not convinced you care that much about price beyond the wider kind of a PR [inaudible 00:12:17] and brings people into the system. I don’t think you’re that. I don’t see you as somebody that is incentivised by the price.

Peter Todd: Well, I mean price is a funny thing, ’cause people often say, the price doesn’t matter. And, that’s definitely not true. Bitcoin security model relies on it being valuable. There is no getting around that. And, it probably would not work, if the price was said a thousand times less. Someone would probably attack it for kicks and giggles.

Peter McCormack: So, you were saying you started to look at the reasons why it won’t work. What were the main issues that you found, and where the things you attempted to try and break?

Peter Todd: Well, really, like the one big thing for me was when I realised, “Oh yeah. Scalability really matters, and this stuff doesn’t scale.”

Peter McCormack: Right.

Peter Todd: I figured that out, you kind of says embarrassingly late. But, in terms of like how long I was looking at Bitcoin seriously, fairly early. From the time I started looking at Bitcoin seriously, to when I realise this, and how important it was, we’re probably talking like three or four months.

And, that was while I was at a startup, doing a university career at the same time. Simple truth is, I just didn’t pay that much attention to it for quite a few years. And, when I realised that, well, I got very active and tried to solve this problem. And, also importantly got very active in debating people who thought it wasn’t an issue.

Peter McCormack: So, were you debating Rodger?

Peter Todd: Oh, he wasn’t around but around then.

Peter McCormack: Like you were going about earlier, okay. So, who would be debating this?

Peter Todd: Gavin Andresen, and actually literally debating Gavin Andresen on Bitcoin talk forums was probably the thing that got my name up there.

Peter McCormack: Right, okay. Because-

Peter Todd: There is a thread on Bitcoin talk where I disagree with Gavin Andresen, and it just spiralled.

Peter McCormack: And what? The disagreement was what? Block size?

Peter Todd: Exactly.

Peter McCormack: Okay. What did he want?

Peter Todd: His viewpoint was, yeah, he can … If I remember correctly, his exact viewpoint was you can have an unlimited block size. And, that was just such an extreme position. I laid out, very carefully, why this did not work. And, it wasn’t the first time there’d been a disagreement on that, but at least for me personally, that was the timeline when, “Hey, this is Peter Todd, the guy who disagrees with Gavin Andresen on this. And, these seem are a good point.

That’s really why my name got known. And, things just built on there.

Peter McCormack: But, there are different reasons why … Well, people give different reasons for why a larger block size won’t work. Some people I’ve heard discuss it because it doesn’t scale in computer power, ’cause of nodes.

Peter Todd: Remember, the notes Gavin’s view there was an unlimited block size. He thought the incentives were such that miners would voluntarily restrict the size of their blocks, even though they could make the biggest blocks if they want. And, I laid out basically with a bit of math and game theory why this is a bad idea.

That wasn’t even like a bigger picture. It’s just this is broken, because miners can do this when they create a bigger block, they’re going to push out the competitors. That’s kind of the arguments in a nutshell. And, the simple reality was, I was right on that. And, that’s just so well supported by academic research since. And, Gavin was just dead wrong.

Peter McCormack: And, has he ever come back and said, “You were right”?

Peter Todd: Nope.

Peter McCormack: Okay.

Peter Todd: I mean, there’s a reason why he’s no longer involved in Bitcoin in any real sense. He just wasn’t competent enough to do it.

Peter McCormack: Yeah. There’s probably more than one reason as well, right?

Peter Todd: Supporting Craig Wright was probably not the best move. But, all that stems from the fact he just isn’t that competent at what he was doing.

Peter McCormack: And, I guess it requires a certain level of competency to be able to work at that level. And, it doesn’t feel like there’s a lot of people at that level.

Peter Todd: No, definitely not. No. Most programmers in general, do you not have the capability to work on this stuff, because they don’t think it adversarially. It’s a tough thing for people to imagine. Most people are just not used to imagining, “All right, what are the bad things that could happen?”

Whereas for whatever reason, I, and a few other people, are good at that. I’m quite happy to imagine all the ways people could screw people over.

Peter McCormack: What do you make of Luke’s ideas around a smaller block? Is it 300K?

Peter Todd: I think his technical arguments for that are good, but I think he doesn’t understand the social side of that, which essentially makes it impossible. And after all, I mean, let’s face it, Luke is a crazy evangelical Catholic. He has very, very, very strong beliefs that are ultimately driven by very strongly held principles.

He is, to us, an evangelical crazy Catholic. But, that comes from him having very well defined beliefs and very strongly held principles. And, the logical conclusion of that is his belief system.

And, I think what Luke … I’m not even sure I could say that he fails to see, ’cause he may very well understand this perfectly, but you know why Luke would say something like that is, he has the principles, and he takes it to his conclusion. Whereas the way I’d put is, “Yeah. I mean, he’s not wrong, but it just ain’t gonna happen.”

Peter McCormack: Right. Okay. Where do you envisage the block size being in the future? Do you think it was gonna stay as it is, or do you think at some point there’ll be a change?

Peter Todd: Oh, I think it’s plausible actually for the rest of life of Bitcoin, we’re not going to see another block size increase. And, the reason why I say that’s plausible is ultimately things lightning and whatnot work pretty well. And, what would it be right now? Like 15 transactions per second or something is actually a fair amount.

And, the way people use Bitcoin, like after all, for Bitcoins be wildly successful, it doesn’t necessarily mean that people are actually making payments on it. Bitcoin as a store of value can be an incredible success story.

I think the bigger threat we would have is actually Bitcoin’s inflation schedule, ’cause in the long run … And, this isn’t a short term thing, but this is like 10, 20 years down in the future, there might not be enough inflation to pay for security.

Peter McCormack: I just wrote that down, actually. So, I’ve got a couple of questions about that. So, if it’s just a store of value, and there wasn’t enough Bitcoin being moved around for fees, and the mine of rewards have dropped, that’s a huge risk for the security of Bitcoin, right?

Peter Todd: Absolutely.

Peter McCormack: And-

Peter Todd: But, that’s a risk like 10, 20 years in the future. That is a very long time. And, by then, who the hell knows what the risks are?

Peter McCormack: But Peter Todd thinks adversarially, and I think that goes into the basket of things that you probably are thinking about now.

Peter Todd: Yep. Well, let me look this way. If I were able to go back in time, and redo Bitcoin, ’cause of course, I am Satoshi as is everyone else.

Peter McCormack: I’ve read it. I’ve read you invented Bitcoin at 12.

Peter Todd: Yeah, yeah. If I was able to go back in time and create Bitcoin from scratch, I would have made it have a perpetual say 0.5% or 1% inflation rate.

Peter McCormack: Okay. That’s controversial, for some people.

Peter Todd: I’ll put it this way if you can’t afford like a 0.1% or 0.5, or even a 1% inflation rate, what the fuck are you doing with your life? It’s 1% a year. So what?

Peter McCormack: So, who have you discussed that with? And, like you don’t have to name names. But, have you discussed that with people? What’s the general reaction? Because there’s no reason for that not to be introduced in the future, right? I mean …

Peter Todd: I think the general reaction is … Well, first of all, Bitcoin right now has what a 4% inflation rate. We’re a long way from any of this discussion being relevant. So, I think the general reaction right now is, it’s pushing it to the future. It’s just not a discussion worth having right now.

It’s drama, and of course, you look at my twitter account, and I don’t shy away from that. But, most of the development community wouldn’t really wanna touch the issue. And, I think they’re right. There is no reason to touch this issue until it actually matters.

Peter McCormack: What about if Lightning Network is hugely successful? And, people stop using the base chain, because Lightning is fast, and it’s cheap, is instant. Could we get to the point where there’s no argument to use the basechain, because Lightning is as trusted as the base chain? Do you see what I’m getting at?

Peter Todd: Well, I mean, Lightning security model is riskier than the base chain. It just doesn’t … Lightning, there’s a good reason to use it beyond scale. I mean, Lightning has much better UI experience. But, the simple reality is the Lightning security model is more dangerous than Bitcoin itself, assuming that you’re able to wait for confirmations.

Under certain cases, Lightning can actually be much more secure. I mean, if I go pay you with Lightning, the security of that payment from the point of view of being reversed 10 seconds from now is far better than the main chain ever could be. In effects, it will be better probably what an hour or two into the future.

But overall, if you’re making big payments that aren’t time sensitive, main chain has better security. On the other hand, this idea of Lightning taking my transaction fees, that’s not unique to lightning. Tons of things do this. Exchanges do this. Probably the most payment volume that happens is actually on exchanges. Liquid side chain does this as well. Liquid takes transaction fees away from the main chain.

There’s no end of things that take transaction fees away from the main chain. And, the inflation arguments I would give is very simple. It’s, well, make sure you always have this mechanism to ensure that the chain keeps marching forward.

Even with transaction fees, you actually need this for a kind of subtle to game theory technical reasons. The simple reality is, Bitcoin without an inflation subsidy has a much worse security argument than Bitcoin with an inflation subsidy, even if you have transaction fees paying for things.

Peter McCormack: I haven’t heard you talk about this a lot though, right? So, are you waiting? Is it a case of priorities? Deal with what needs to be dealt with now? And, you’ll bring this up in 10 years?

Peter Todd: Yeah. It’s just isn’t relevant for literally like another 10 years or so.

Peter McCormack: What about 10-minute blocks across the solar system though? When is that going to be a precedent? I read that.

Peter Todd: Well, yes. I did a talk, actually. I believe the title of the talk was a solar powered space miner. Yeah. Solar Powered Space Pirates, a Threat to Bitcoin. And, the simple answer to that is yes, if space travel becomes cheap enough that big mining operations are operating far enough away from earth that the speed of light gets people out of consensus, yeah, Bitcoin’s fucked, and we’ll probably have to increase the block control.

Peter McCormack: And, say are you general evil?

Peter Todd: Yes, I’m a bad person capable of love.

Peter McCormack: Okay. Outside of Bitcoin, ’cause other Bitcoiners are very Maximalist in nature. But, I have seen you talk about Zcash and a theory. Like, what’s your position on alternative coins and alternative currencies?

Peter Todd: Well, the thing is, I’m not a Bitcoin Maximalist. I’m a Maximalist. Anyone who understands economics and finance, and how markets work will be a Maximalist because it is more efficient to have one currency than a whole bunch of different ones. That’s just not a controversial opinion. And, it’s a controversial opinion amongst scammers who want you to go by their ICO.

But, standard non-scam driven, economic thinking, this is not a controversial opinion. This is how the Euro got created. And, there are certainly downsides to not having multiple currencies. The one world currency thing has a lot of very real economic problems. But, they’re not problems that apply to things like Bitcoin.

For digital payments in a decentralised environment, it’s just natural to end up with one coin. Whether or not it’s actually Bitcoin, who the heck knows? But, Bitcoin’s technical design and sort of technical ethos currently are definitely the most suitable for being the one currency everyone uses.

That’s just a matter of like simplicity, reliability, of disinterest in making deep dangerous changes. And, there’s just … Conservatism is a good thing for that store of value. It’s just a pretty obvious set of combinations that mean Bitcoin’s kind of the default there.

Peter McCormack: But therefore, is it good to have competing alternative currencies?

Peter Todd: I mean, it’s not going to hurt things. But, for the most part, the competing alternative currencies are scams.

Peter McCormack: Every single one?

Peter Todd: Well, some are more scammy than others.

Peter McCormack: Is Ethereum a scam?

Peter Todd: Ethereum is a funny example, because the way it was launched, and the way it was promoted, that’s much more of a scam than any of the surf currency itself. Had Ethereum, for instance, been launched. I mean, it’s hard to kind of come up with an example of where this would be possible.

Let’s suppose, hypothetically, somehow launch Ethereum, where it was just an add on to Bitcoin, where somehow the people behind Ethereum were making money off of it. This isn’t really technically feasible, but let’s assume for the sake of argument was. It would still wind up being a scam, even without a separate currency, because they were advertising things that they knew would not be possible.

Ethereum is just a bed of lies if you will. And, I think it’s very unfortunate, ’cause it also means a lot of academics, because they can get grant money from this, and because Ethereum is easy to experiment on. I think it’s pulled down ethical standards of academia.

And, it’s just an unfortunate position to be in. And, this is also … I mean, maybe a good way to explain this is the private chain side of things. Well, some of that’s perfectly reasonable. A lot of the more grandiose claims made are effectively scams. And, it’s sort of a new interesting category of scam where it’s not like we’re directly ripping people off, but rather were lying about what our products can actually do, and we’re getting away with it because it’s security.

And, in security, well I can sell you a magical rock that keeps lions away. How do you know it doesn’t work? There are no lions around.

Peter McCormack: So, what are the main claims for Ethereum then that you think of false?

Peter Todd: I mean, it’s a funny one, ’cause it’s tough to pin down because the main claims were designed to be vague. Claims like this is a world … A great example is the world computer thing. What does that actually mean?

When you start thinking about any reasonable interpretation of it is, no, this is total bullshit. But, it’s presented in a way which is vague enough, it’s tough to argue against. You’ve got to play pin people down on what does a world computer mean? What’s it actually computing?

Now, you ask a normal person, I think, “Oh yeah, computations done somehow on Ethereum.” And, it’s no, that’s not how it works at all. Your Ethereum node redoes the computation. It’s not a computer, it’s a verifier, whereas the sort of general way of building consensus applications I push is client-side verification, which is quite explicit.

Yes, we have this big dataset that your computer verifies. And, other people don’t even have to verify the data. They don’t even necessarily know what it means. They may never even have a copy of it. But, if I want to convince you that something’s true, like I just sold you a house, I give you the data to prove it’s true, and you verify that data yourself, and you come to a conclusion that yes, you now own a house, or no, I’m trying to defraud you.

That is a sane way to talk about block chains. A world computer is not. A world computer is a pie in the sky scam material. And, even Vitalik, I mean he’s kind of admitted, “Well, the world computer stuff was a bit of a red herring.” I’m sorry. The moment you say red herring, and please go and invest in my thing, you’re probably scamming someone.

Peter McCormack: I don’t get the feeling he intentionally scammed somebody.

Peter Todd: You know about his quantum computing thing?

Peter McCormack: No, tell me.

Peter Todd: Well, just prior to Ethereum, he was involved in a quantum computing scam.

Peter McCormack: Okay.

Peter Todd: And, essentially what the scam was was they would do simulated quantum computing that would somehow be better than anything else. It just didn’t make any sense. And, his claim is, “Oh! I kind of young, and just had higher hopes for it. That’s all.” No, you weren’t that stupid.

First of all, you were like 19, at university. You knew what this was. You knew this was bullshit. Yeah. The guy’s got the mind of a scammer, basically. He’s got the intentions of a scammer.

He’s very clever about it. He’s not someone who is careless. He’s not someone who gets himself clearly involved in a scam in the way that you can prosecute. But, he’s pushing dishonest stuff. I mean, that’s what scammers do.

Peter McCormack: So, ETH 2.0, I’m guessing you’ve read some of the specs.

Peter Todd: I mean, it’s one of those things where he just go put up a whole bunch of complex shit on the wall to try to be resistant to criticism. I think I believe Greg Maxwell was the one who deserves credit for this. But, he’s pointed out how the general approach of Ethereum crowd is, they put something out, it gets shot down because it doesn’t work. So, rather than go back and fix the problems, they make it more complex.

And, if you keep repeating this, eventually you appear to be secure, not because you’ve actually created something secure, but rather, you’ve created something sufficiently complex, it’s just too much work to criticise.

Peter McCormack: Yeah. I mean, I’ve read James Press, which is medium posts recently looking at ETH 2.0. I don’t know if you saw it.

Peter Todd: I might have.

Peter McCormack: I mean, the only thing I could think of when I was reading this is, “This just seems an insanely complicated way of creating a distributed database.” I was written about sharding, and then I was reading about state rent, and that certain things would be on chains. And, I was just thinking, “What’s this for?” I just can’t get my head around it.

Peter Todd: It is designed to be sufficiently complex that you can’t criticise it. Now, on the other hand, if I wanted to explain to you how Open TimeStamps works, I could do that in a morning, including the part where I explain how hash functions work. It is dead simple.

If I wanna explain to you how my proof Marshall Project works, I’d probably have to go spend the afternoon as well. This stuff is designed to be dead simple. I mean, this is why, on my twitter profile for a long time, the pinned tweet was, “A blockchain is a chain of blocks.”

Peter McCormack: I knew that was coming.

Peter Todd: Yeah. Blockchains are not complex things. People try to make them complex things, so they can go sell stuff, or in the case of academic skill, write papers and make them relevant. But, they just aren’t that complex.

Peter McCormack: Yup. And, they have one purpose. Like, Jimmy talks about this a lot. The blockchain has a really good purpose for Bitcoin and money. Nothing else really. And, I’ve tried-

Peter Todd: I actually disagree on that.

Peter McCormack: Well, that’s good, because I’ve tried to be open-minded, and tried to kind of just be as open-minded as a can say, “Okay. Is there something else here?” Like-

Peter Todd: You’ve gotta remember because I define a blockchain is a chain of blocks, I would actually have the viewpoint that, “Yeah. Blockchains are worth adding basically anything.” I mean, the moment you have a data structure, where you even wanna create a backup of it, it might as well throw it blockchain in there so it can update and ensure you have a complete copy.

My Open TimeStamps project, it’s a centralised system that creates timestamps, long story short. Well, one issue with it is if the central servers go down, you want to have a backup of all the timestamp proofs they made. How do you make that backup? Well, currently, you go and go through this HTTP, RPC, restful protocol, total box standard stuff, and he just download one after another.

How do you know that your copy of the back up is the same as mine? Well, obviously you gonna add hashing to it. Well, how are you going to add hashing to it? Well, why don’t you go and make updates, and have one update hash another? Oh, what do you know? We’ve created a blockchain.

Peter McCormack: Indeed a blockchain, yeah. Okay. So, I met with Zac Prince of Block Fight, and we have a long chat about Bitcoin. They do crypto back loans. And, it’s a market that makes sense. But, he also said, it doesn’t make sense when they’re Lending money, say to Argentina, that if you’ve got to lend out Bitcoin because it’s volatile.

He said it makes sense to do a stablecoin. A stablecoin is built on Ethereum. So, whether it’s a scam or not, the fact that people are building things that people are using, how do you sit with that?

Peter Todd: Well, so the point I’d make there is, the stable coin’s built on top of Ethereum. From a tech perspective, that could actually be the right decision. And, the reason why there can be the right decision is, yeah, I mean the infrastructure is there. We know we can throw together something. It doesn’t work as well as it could. But, the tooling’s there, we can get it done, push it out the door.

I’ve literally told clients of mine, “Well, you actually might want to build this on Ethereum, ’cause alternatives don’t exist yet.” We know they can exist, but the effort to actually make it work hasn’t been done yet. And, in all equally, I’d say the stable coin idea is just an obvious no brainer.

You might want to have exposure to this currency. Why wouldn’t you want to have some nice digital way of doing it with a well-defined trust relationship? It’s just not a complex thing to talk about. It has very obvious reasons to, in much the same way like having an ETF, it makes a lot of sense for certain people.

Now, having an algorithmic stable coin, where you try to do consensus, decentralised magic to keep the price stable, there’s a pretty good reason. I think those are impossible. It’ll never work.

But, a trusted stable coin, where you have a central issuer, who you have legal mechanisms to ensure that you get your money back, yeah. I mean, why not? Hell, in some cases, a stable coin that’s actually a total fraud can actually make sense. If I’m a trader, and I want to temporarily move out of a position into a stable thing, and then move into another position, even if the stable coin is a total fraud, and there’s no US dollars or whatever backing it, it can still be useful for me as a trader, because my risk of the stable coin going belly up, and the fraud playing out maybe less than the risk I have of not moving my currency, not moving my assets into that stable currency for whatever reason I needed to.

Peter McCormack: I only see the two use cases. I see Bitcoin and a stable coin. That to me is pretty much all I think we need, personally. I mean, you probably can think of some great other examples.

Peter Todd: Well, if you’re talking about money, and things related to money, I think you’re a lot more right than people would want you to be.

Peter McCormack: Yeah. Well, do you know why? Because other people want to invent other uses for blockchain, ’cause they want to monetise it. And, other people want to shoot down stablecoin-

Peter Todd: So, I guess the way I’d put it is, if there’s a money component involved, I think you’re ultimately right. If there’s not a money component involved, and we’re just trying to do something related to some asset or some data structure, which for a reason we what consensus over, I mean, yeah, block chains basically always make sense.

But, that’s because of blockchain is just a chain of blocks. It is not rocket science. I mean, I love the example GET. People say, “Oh, but then is GET a blockchain?” And, my answer is, well yeah. it’s basically a blockchain. It doesn’t quite precisely match the linear chain of blocks in how we use it. But, why GET is a set of hashed things in a direct acyclic graph is essentially the same reason why Bitcoin is a chain of blocks.

I want to make sure that my copy of the source code on my computer is the same as your copy. That’s why Bitcoin is blockchain. That’s why GET has something nearly a blockchain.

Peter McCormack: What about privacy coins? Obviously, I’ll see you tool more about Zcash than-

Peter Todd: Say proof of what?

Peter McCormack: Privacy coins.

Peter Todd: Oh, privacy coins?

Peter McCormack: Yeah. So, I’ve seen you talk about Zcash more than, say, Monero. What’s your position on privacy coins?

Peter Todd: I mean, they make a lot of sense if they work. The only reason I want to talk more about Zcash that Monero is Monero has less wrong with it.

Peter McCormack: Okay.

Peter Todd: Monero definitely could, in theory, have less privacy than Zcash. The underlying idea of what Monero is, it certainly has the potential for less privacy than Zcash. But, the Monero people have just done a competent job implementing something with very little drama, and the people behind it all seem pretty ethical. And, there’s very little criticised about Monero.

Peter McCormack: It’s the only other crypto I hold. I’ve got Bitcoin and Monero.

Peter Todd: Yeah. I mean, I hold essentially trivial quantities of Monero and Zcash, enough to use on occasion. But, in theory, Zcash should be better. Its privacy, the potential for privacy’s much better.

Peter McCormack: Is that ’cause it uses Zcash nodes?

Peter Todd: Exactly. Yeah. The difference is, in Monero, your payments might’ve come from immediately one of say 10 different people, and then of course you know a hundred and so on, whereas in Zcash, the moment you do a payment, if it’s a shielded payment, you’re now part of this big anonymity set.

What’s wrong with Zcash is sort of all the implementation details and sort of the people behind it.

Peter McCormack: Wow! So, I interviewed Zooko last week. And, one of the most important questions I think I put to him is I said, “Is a Zcash a company?” ’Cause that’s what it feels like. It feels like it’s a company.

Peter Todd: Yeah, it is, effectively. And, the reality is the way they do … The way they will do Zcash is very explicitly centralised. And, they kind of try to put fake leaves on edge. But, probably it’s a company of a few different people with really dubious ethics. It’s just …

I mean, it’s kind of fortunate, ’cause it’s a scary thing to have. The best privacy tech out there, for that type of use case, run by people who will lie to you.

Peter McCormack: Yeah. And, I’m not surprised that it seems like [inaudible 00:38:40] brothers have a preference to Zcash. It didn’t surprise me.

Peter Todd: Yeah. Well, the thing I think with it is, people in that kind of sphere, they would rather work with people who are not totally ethical. I get the sense this is why Coinbase and Zcash kind of seemed to get along, because they kind of see eye to eye on, “Well, we’re not going to strictly tell everyone exactly how this really works. We’re happy to Futz with stuff.”

I mean, when they did the trustee set up. The simple reality is they botched it. And, rather than just come and say, “Look, here’s where we made our mistakes. Here’s what we’re going to do better.” They just lied. They said it was multiparty set up in. And, the reality is, it wasn’t.

It was intended to be, but due to technical failures, I don’t think you can make that claim. In the Bitcoin world, I think had that happened with the people behind Bitcoin, they would have said, “Look, we screwed up this, this, and this. We’re going to fix this next time. Here’s the timeline where we roughly wanna do it. Here’s why this isn’t necessarily a big deal, et Cetera, et cetera.”

Had Zcash has simply done that, I think Zcash would still be a success. But, that’s not the way they think. They think, “Well, shit, we got to have good PR on this. We’ve got to preserve our money coming in.” And, after all, I mean, they get a ton of money from Zcash. They have incentives to hide flaws, because that’s her income, whereas in the more long term view, would be, “Well, all right, we might lose some money in the meantime, while we lose some market confidence. But, the longterm effect will be people will actually trust us.”

I don’t trust Zooko not to lie me.

Peter McCormack: Yeah. I’ve got to say, I trust Ricardo a bit more.

Peter Todd: Yeah.

Peter McCormack: You’re a big fan of Ripple Coin, right?

Peter Todd: Well, I think Ripple’s wonderful idea. You mean Ripple, the original concept to like peer to peer payments, right?

Peter McCormack: I’m on about Ripple Coin.

Peter Todd: Yeah. That’s remarkably scammy.

Peter McCormack: Yeah.

Peter Todd: It’s interesting. So, I, at one point, worked for R3. And, I should be careful what I say here, cause there’s probably NDAs, and they’re a bit … They are not very happy with me. But, long story short, I think what I can say is, initial was working as a consultant, evaluating other coins, and other systems. And, I think their business plan there was let’s just go buy something and let’s package it up and sell it to banks. A perfectly reasonable thing to do, act as middlemen.

Well, they had me analyse Ripple, ’cause at the time, there was a lot of interest among banks. And, I analyse it, and said, “Yeah, the centralised system obviously.” Which isn’t necessarily a bad thing. For banks, I think, that would have been fine.

Of course, I soon found out, they weren’t saying it was centralised banks. They were just flat out lying about what it actually was. So, when I did a big presentation in front of most of the world’s major banks and representatives from them, they’re like, “Wait, Ripple’s what?” ’cause they’d been lied to.

And, ripple these days, I don’t actually get the sense that’s true anymore. I get the sense that Ripple, the company, has become much more reasonable. But, Ripple’s tied to currency, and they don’t have any ability to get rid of this currency, which doesn’t really … It isn’t needed for technical reasons.

So, I think they’re putting in a very awkward position where there’s rabid fan base of big holders, essentially.

Peter McCormack: Very strange group.

Peter Todd: Yeah. Very, very strange. And, I would not be surprised if … Like as an example in Twitter, you say something about Ripple and the XRP troll army comes down on you. I would not be surprised if, for the most part, that sort of army of crazy people is actually not that involved with Ripple, the company selling things to banks. I don’t think that that dumb.

But, they can get away with it. There’s no mechanism for Ripple, the company, to actually extract themselves from the currency. Like it or not, they created the currency. They own a big chunk of it. They can’t get away from that. And, I mean this is one of the real dangers of creating coins for services. You might get tied to a coin that’s pointless.

Peter McCormack: Well, that’s why I call it Ripple Coin. I never changed from Ripple Coin, because I think it’s important for people … It was like with Bitcoin cash becoming BitCash. The alternative name, I think, was important.

I always call it a Ripple Coin, because I think people have to know, they have to know, it was created by the company. That it wasn’t a gift.

Peter Todd: I mean, it’s worse than that. I mean, last I checked in government, I haven’t looked very recently, the consensus was still controlled by the Ripple company. You can’t get away from the fact Ripple’s architecture is centralised.

The XRP community can say all they want. “Oh, all you know, it’s just nodes. You can go pick a different set.” Well, yeah. I mean, I can go pick a different currency. Unless you and I agree on the same set of nodes, the reality is we’re not looking at the same currency. And, that was really all my paper was.

I just pointed out. Yeah. Obviously, if you pick a different set of central nodes controlling the consensus than me, we can get out of consensus, and all hell will break loose. Thus, the only sane thing to do is pick the same set of servers for control of consensus.

Peter McCormack: One thing I do want to ask you about is because I think one thing, a lot of other alternative currencies have managed to do, whether it’s right or wrong, but by design have been able to create an incentive structure and financial incentives for developers.

Bitcoin is still largely voluntary, or there are some contributions in different ways. I know you’ve had a contribution. But, it’s-

Peter Todd: My point is not voluntary in the sense that developers go unpaid. It’s voluntary in the sense that the currency itself isn’t directly paying developers.

Peter McCormack: Of course, yeah.

Peter Todd: But, the reality is there’s enough money floating around for developers get paid, even total screw ups like me.

Peter McCormack: Are you still working on Bitcoin?

Peter Todd: I’m not working on Bitcoin core. But, I am working on projects around it like Open TimeStamps and Proof Marshall. And, I’ve had surprisingly good success getting paid for that.

Peter McCormack: I guess it depends on who you are though. And, the reputation you’ve built, you can be funded. But, when you say there is funds available for developers, I mean, how do they go about receiving funds? How do they do it?

Peter Todd: I mean, it’s kind of like anything. You do a bit of work, you show that you’re competent, and you find someone who’s interested in paying you to do more work. If you’re competent, and you prove that, the simple reality is there are ways to go get money. It is not the hardest part.

The hardest part is getting to the point where you’re confident. And, the things that us, even in coins which have developer funds, getting money out of those developer funds is surprisingly hard.

Peter McCormack: Right, okay.

Peter Todd: Like Zcash is a great example where the Windows clients for Zcash we’re completely unmaintained because Zcash wasn’t giving them any money.

Peter McCormack: Okay. So, ’cause I sort of say would Luke put up his patron, and I supported them. It just feels like there should be almost like something he shouldn’t have to worry about.

Peter Todd: How? I mean, the simple reality is, having funds in these coins is not a magic solution to that either. Yeah. The bigger problem is more you getting to a position where you’re doing interesting work that’s getting valued. And, if you’re able to do that, and actually contribute, getting that money is not that hard.

Peter McCormack: Is there enough developers coming through? ’Cause we talked earlier about enough of the kind of biggest and brightest minds who can really think adversarially or think outside the box. But, are there enough developers coming through who can we just work on more simpler tasks?

Peter Todd: The impression I get is mostly yes. But, the interesting thing about this is like Bitcoin core itself, that actual core software, I may not be very popular saying this, but I think it’s true that they’ve got good enough developers, maybe a little too many.

Bitcoin core itself doesn’t necessarily need to change that much. And, it can change on a somewhat slower basis than it has. I mean, it’s not really a big concern. The more interesting thing is like all the periphery infrastructure around it. Things like libraries that actually work are well documented and so on.

And, that’s not very sexy work. So, that may actually be the thing where we need more money put into. But, when you look at other coins, which should do over funds, they don’t do a good job with this either. So, it’s not like this is a magic solution that’s proven to work. This seems to be more a solution which has proven to make the people founded the coin a ton of money.

Peter McCormack: Yeah. I spoke to Brian Bishop. And, I think he says something along the lines of, “It would be great if some parts of the cost start to become compartmentalised, ’cause it’s kind of a big sprawling mess right now.” Is that correct?

Peter Todd: Oh, yeah, yeah. The fundamental like Bitcoin core architecture is not, I think, how you would do it these days. I think in the context of when it was created, it was probably the right decision to make. Do this very simple thing, which one person can create, and one person can comprehend, and it’s just one code base that’s very easy to review. But, for what we want it to do now, it’s probably not ideal.

On the other hand, I mean, people often think, “Oh! Bitcoin core doesn’t have this feature. It’s terrible.” Well, so what? Just turn on Bitcoin core node, grab the data from it and do whatever you need to do. What do you need to do? Do you need to have an index of transactions? Just follow the blocks and index your transactions. It’s slightly less efficient. But, so what?

Peter McCormack: Even if people who kind of want the base change essentially ossified. Is that the word they use?

Peter Todd: Base protocol is pretty stable. Not quite as stable as say TCP/IP. But, it’s reasonably stable. And, equally, so has the stability of TCP/IP held back the Internet. I don’t think you’d make the case at all. If anything it’s helped it by having the simple thing that works, and you can build on top of it.

Peter McCormack: I wanna ask you a bit about the work you’ve been doing. But, before that just one kind of … I’ll say one final question. I haven’t got through hardly anything here. This has been great. But, I do want to ask you about your views on fungibility, because in doing my interviews, I’ve kind of had two different perspectives.

There are some people who do want fungibility on the base chain. But, there are some like Saifedean wouldn’t. Saif’s view is that we want to say a completely transparent based chain, so we can ensure nobody is operating with say, fractional reserves. Where do you sit in that kind of field?

Peter Todd: I think his viewpoint is technically ignorant there. You can definitely have … I mean, as an example, ideally, Zcash would be completely non-transparent. In reality, it’s nearly entirely transparent, ’cause you’re actually using the shielded transaction features is hard and discouraged.

But, in theory, Zcash could be completely shielded. And, even then, it’d still be easy to be transparent. The better argument to make there is all the technology for privacy on base chains is potentially dangerous.

Peter McCormack: Okay.

Peter Todd: Yeah. Example being, with Zcash, you have that trusted set up. A trusted setup could easily fail. Implementation bugs could easily cause it to fail. In fact, the fundamental Zcash library, the thing that verifies transactions, just prior to release, they found a bug in it that could have allowed a moment of inflation. And, that’s not even like a trusted set up failure. It’s just a simple bug in it.

And, it’s not an easy bug to find. You really got understand math in very deep detailed find something like that, because you’re relying completely on the math to protect you from inflation. Whereas in Bitcoin you’re relying on stuff you could explain to a drunk art student. Speaking about a fine arts degree.

So, I’m a little bias there. I liked this level. But, that’s useful, ’cause it means tons of eyes can see this stuff. When Bitcoin had this some recent inflation exploit-

Peter McCormack: CV bug.

Peter Todd: Yeah. Had that actually being used, chances are alarm bells would have gone off in tons of places, because people are looking at, doing the math, figuring out how many Bitcoins are in existence. Does this number make sense? Any idiot can do that. It’s not hard. For Zcash to do that, you need to re-implement all Zcash nodes. And, it is a nightmare.

Peter McCormack: So, I guess you’re keen on some form of fungibility, but do you … Are you keen on it, say as a side chain or some kind? Like how do you-

Peter Todd: Well, I mean, Lightning adds that. Any add on to Bitcoin that’s scalable will naturally have better fungibility. And, the reason is, to scale, you have to distribute less data to less people. It’s just not possible to create a scaling solution that doesn’t at least add privacy to some adversary.

As an example, Coinbase. Let’s suppose, well, PayPal. Let’s go really out there. PayPal, compared to Bitcoin, has better privacy against most adversaries. If I pay someone with PayPal, North Korean spies don’t know what I did.

Obviously, the US government probably has a full copy of everything. But, most of my adversaries now do you not know that I made that payment, and have no way of knowing. That is categorically better than Bitcoin from that narrow perspective.

If my adversary’s US government, totally different discussion. But, PayPal scales. And, the only way it could scale is by reducing the data available to the bad guys.

Peter McCormack: Okay. All right. Look, we’ve done a lot here, but I do want to cover some of your work. So, when I spoke to Jack Ma, he was like, “Peter’s really busy working on Proof Marshall.” I don’t know anything about it. Can you tell me, what is Proof Marshall?

Peter Todd: Well, all right. So, first of all, my simpler project is Open TimeStamps. And, Open TimeStamps proves data existed in the past. The problem with Open TimeStamps is it doesn’t prove anything about whether conflicting data also existed. An example being, I sell your house. I give you a sign digital document saying, “I, owner of 1234 Main Street sell it to you.”

What you don’t know is if I already sold that someone else. Proof Marshall fixes that problem by … It’s a library to create data structures where you have consensus over. And, what consensus means there is simply, in the definition of selling a house, all the possible places where I could have put that data, you now can see. Thus, you can rule out me selling the house to someone else.

And, how do you do that? Well, you throw in a whole bunch of Merkle trees and hashing. This is … I mean, what’s hard about Proof Marshall is that the strategy for the implementation is effectively taking pointers and abstracting that concert.

Pointers are such a low-level fundamental idea in computer science that just … The low-level mechanics of actually implementing this is challenging and tricky to do well. And, you get a lot of issues. Like, if I’m giving you a math proof that now you own this house, I want to make sure that even if the code or writing that application isn’t that careful, that math proof won’t, for instance, use up all the memory in your system.

Turns out that’s actually a hard problem. It’s not a hard problem for like Bitcoin level reasons. And, this is an economics problem. It’s just, it’s a tough thing to implement at a computer science level, or maybe I’m just not a very good coder.

Peter McCormack: So, what’s your status? Where are you at with the project?

Peter Todd: About two weeks, for sure.

Peter McCormack: All right. Is that this week?

Peter Todd: No. I mean, truthfully, it’s something where I’m always thinking, “All right, I could finish this in two months.” But, two months later I say, “Oh, yeah. I didn’t realise but this isn’t this.”

I mean, as an example, the first version I had, for how it would represent, how it would obstruct a pointer, made the assumption that you always hash the data. And, I did a bunch of work in that, and I was, “Oh, yeah. That doesn’t actually work. That causes other technical problems that, long story short, this doesn’t work.”

Another example was I had this … My most recent implementation had a thing where when you took the data, in processing, and deserialised it, you would make a copy of it. And, I naively thought, “Oh, that’s not big deal. Make a copy of it. It’s all well, and good.” Of course, I go through the adversarial think, I was, “Oh, shoot. Because I made a copy of this, now my API doesn’t have a good way of assuring I don’t run out of RAM, ’cause all of these extra copies.”

So, I had to effectively redesign it so that all the data can be operated on directly. If you’re a programmer, the term I would say is the serialised version of it is identical to what you would process in main memory. Thus, you don’t have to make a copy to process it.

And, this is all like very much in the weak technical stuff. But, to make a robust implementation that works well, you have to solve these problems. And, it’s just hard. And, because it’s still at such a fundamental level of design, having two people work on it once, it’s very challenging.

Peter McCormack: Okay.

Peter Todd: ’Cause if I make a change, I’m usually changing how any of the code works. And now, if I have a partner working with me, suddenly everything they’re doing is broken. Maybe if I was sitting next to a guy in an office, this might go faster. But, it’s just not there. And-

Peter McCormack: It’s a one-man project.

Peter Todd: Yeah, yeah. For now. But, if it works, it’ll eventually work, and long store short is it’ll be a nice library to write consensus applications, to do all kinds of things you want. As an example, you could even implement GET and Proof Marshall to just have a good way of making sure you and I have the same copy code. Certificate Transparency is another example.

When you go to a website, the certificate that proves your talking to the computer you think you’re talking to, like your bank, for instance, that are published in a blockchain. The people who create certificate transparency, of course, hate the term blockchain and probably would strangle me if I said this in front of them. But, the reality is the data structure is effectively blockchain.

In proof Marshall, you could do things like that and … All right. You can do them now, but it’s just a lot less work when you have a library that just does it for you. It’s like … I mean, SQL databases are like this.

Sure. Prior to dimension SQL, you could, in theory, do anything you do with. It was just so much more work to get there.

Peter McCormack: I think I’ve kept up with about a good 50% of today.

Peter Todd: Well, it’s enough to do a 51% attack.

Peter McCormack: Well, yeah. I do wanna do that. I wanna 51% attack. We’re just going to have to do another one another day, ’cause there’s so much more wants to talk to you about. But, there is a couple of final closing things I want to talk to you about. One is just a bit left field.

I’ve noticed you tweet quite a bit about journalism. Why does that get to you so much?

Peter Todd: I think this really comes down to … And, I’ll say straight off, this is an example of not staying in your lane. This kind of phrase going around, stay in your lane, only talk about the stuff that you’re supposed to do professionally, and so on. And, I really don’t care what that for Twitter.

And, a lot of that gets down to, what does it take to have a society of the functions? You have to have people agree on basic facts around the world. And, I think the reason why I’m critical of that, same reason ultimately I’m critical of many scams in the crypto world, where people were saying things, but the projects just aren’t true, and polluting the ecosystem of ideas with false things.

And, unfortunately right now, we have a big problem with journalism where, first of all, it’s not very fun. It’s not well funded. It just isn’t that money to actually pay journalists to do their job properly.

I have quite a few friends who are journalists, and I see this every day. I mean, the timelines they have to operate on are ridiculous. There’s no way for them to do a good job given how fast they have to put out articles with how little help. And, on top of this to make money, you wind up with all kinds of dark practices, like clickbait.

And, when you combine that with the very ugly political landscape of the US, you get really ugly things like Covington, where I think it’s pretty fair to say major media organisation are, “Oh, this is a great story. Fits our narratives really well. We’re going to get a ton of clicks on this. Let’s rush published before anyone else does.”

And, the rush to publish is a really big deal. I’ve been told, directly by people managing media organisations in the crypto space, that collectively people like me are a huge competitor to them, because I can tweet faster than they can publish, and literally minutes matter in this stuff. If they’re not first to publish, they will get less clicks, less views, less money.

It sounds so stupid, but this is the truth of it. And, that pushes a cycle that just doesn’t allow for good research and good work. And, unfortunately, there are no easy ways to stop this. Maybe one of the solutions could be more use of defamation laws, and life moves on. But, there are very like very, very real risks to this for freedom of speech.

Peter McCormack: Yeah. I mean, my last interview that went out yesterday was Andrew Torba from What do you think of Gab? I mean, the content is tasteless. But, do you agree that …

Peter Todd: I’ve never actually looked at Gab’s website itself. And, I’m kind of sympathetic to them. I mean, I think organisations like that should be able to exist. I think the fact that they’ve been deplatformed from payment providers is a straight up antitrust issue. And, they’re not the only example of this.

I mean, the fact of the matter is companies like PayPal, MasterCard, Visa, are able to restrict freedom of speech very effectively. Not as effectively as they could without safe things like Bitcoin. But, the amount of control they have over what content gets produced is very scary.

Where deplatforming ends up is people being able to restrict speech, because they can say, “I don’t like what you’re publishing, and we’re going to cut off your money.” And, you can’t, for instance, do journalism without access to a flow of money to go pay people to do stuff.

And, this is a very, very real issue. What Patreon has done is scary. Now, as a libertarian, I’d say Patreon itself, I don’t have issues with them cutting off people. What I have issues with are the payment providers who have now said, “Oh, you’re trying to compete with Patreon, we’re going to cut you off as well.”

That’s where I think this crosses the line. It’s getting very scary as a society. So again, do I support Gab itself? Whatever. Let them do what they want. But, do I support fighting back at why Gab has a hard time running a business. That’s what matters to me.

And, I’m just not that concerned about people spreading hate on the Internet. I don’t think that’s actually a big concern for society. Particularly when we go see the left’s doing exactly the same thing but in a different context. There’s no like clear moral high ground here. And, obviously, if the left can do this, and society hasn’t collapsed, it’s not necessarily such a bad thing.

And, in some ways that kind of thing pisses me off more ’cause I definitely identify as liberal.

Peter McCormack: Well, yes I do sometimes. But, I was saying to Andrew that like politically, I’ve got no idea anymore where I am, because I’m finding so much to dislike about everyone. But also, there are these certain conservative things I do like, and then there’s a kind of liberal things I like. And, I’m just so confused. I don’t know where to position myself.

Peter Todd: I mean my entire adult life … I live in Canada. My entire adult life I’ve voted for the Liberal Party, which in Canada, the Liberal Party’s what the name suggests. It’s the Liberal Party.

These days I’m not sure I identify with them anymore. I’ll probably still go on voting for them because they’re the best of bad options. But, yeah. And, I think part of it too is like many of the social issues I do care about. Like freedom of speech, and gay rights and so on. A lot of that’s actually kind of solved.

Abortion’s legal in a lot of places. Gay Marriage is legal. The things that I cared about, we solve those problems.

Peter McCormack: Through free speech.

Peter Todd: I mean just through like the way politics moved. The Conservative party’s eventually, “All right, fine. We’ll go along with this.” And then, probably isn’t … At least in Canada, it’s probably not going to get reversed. So, now it’s like, “Oh, do I need to go vote for liberals again? I mean, the things that we’re fighting for gut solve, the things that they’re now fighting for, I don’t agree with. It’s a very strange situation to be in.

Peter McCormack: I think we could do a whole show on this. All right. Just to close out. We’ve had 10 years of Bitcoin. So, we look back. Looking forward over the next 10 years, what are the key things you would like to see happen? And, what are the most important things, not just in terms of code and develop it, but just overall for Bitcoin? What’s gonna be important?

Peter Todd: Well, I’ll give you a very specific answer, which is the things I’m working on with client-side validation like Proof Marshall I think are critical to moving this stuff to the next step. Getting past this narrative of all we need some Ethereum chain, where everything’s in one place, which we knew just doesn’t work.

I think smart contracts are actually really useful. But, they’re not useful done in the way Ethereum people want to do them. It doesn’t work technically. So, yes, this is kind of very narrow answer. But, this is the stuff I’m directly working on. And, I think that’s a very fruitful ground for making new and interesting things.

Beyond that, I mean, I’m sure the Lightning crowd, and so someone will do great work in making payments better and so on. But, on the store of value stuff, just not screwing up is enough to make that possible. So, that’s kind of my answer there.

Peter McCormack: Great. This was utterly fantastic. Thank you so much for coming on.

Peter Todd: Thank you.