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Pierre Rochard

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2022-09-14
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2022-09-14
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  1. “And instead, because obviously all the participants in these systems are trying to profit maximize. And so they were like, well, how do we create a smart contract where, yeah, you put your Ethereum into it, your Ether, your ETH, and you're also able to then use that stake to ETH for other purposes, whether it's selling it or leveraging up with it or doing any kind of DeFi Ponzi type stuff. And that way you're double dipping, right? Because you could be earning the staking yield and then you go out and you lend your staked ETH to somebody else and then you're earning the yield from just lending out the asset. And so there are massive, massive network effects with liquidity.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  2. “Yeah, so going into kind of Ethereum 2 and this wave of staking over the past few years, I did think that the centralization issue would come from exchanges. And then we saw the development of liquid staking of basically that you can stake your token and have it too. So kind of defeating this idea of you're going to lock it up and it's inaccessible. And so that means that you earn this yield because you're foregoing using it for other purposes.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  3. “Sales systems upgraded, et cetera. But yeah, there's also tremendous education still needed and also undoing a lot of misinformation that is being spread by folks who are competitors to Bitcoin Enlightening or just politically opposed to it.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  4. “And so I do find it hard to relate to it. I'm like, what are these people doing? I get anxiety moving $1,000 worth of Bitcoin, right? So the idea of moving billions of dollars worth is incomprehensible to me, but clearly that's going on. We see that from the network activity and from the data analysis. Now, with Lightning, we're talking about much smaller dollar amounts or value of BTC. When I think about when I go to Home Depot, now this number keeps going up, but usually I spend like $100 to $200 when I go to Home Depot. So that is easily accessible to Lightning. Sending a $100 to $200 payment over Lightning is not challenging at all in terms of the liquidity or anything like that. We're purely at that stage of end to one, or sorry, sorry, one to N of distribution, right? What strike is doing the Chack Mahlers with, you know, getting all these points?”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  5. “Or Michael Saylor, who've identified that the Lightning Network is the best layer to solution for a lot of the issues that people have with regards to Bitcoin as day-to-day payments. And I think that this idea of data payments is very distinct from international settlements, right? like trillions of dollars And part of the disconnect is that me, you know, we're we're normal folks. We're not moving billions of dollars worth of Bitcoin to my knowledge I don't know if Preston's goes billions”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  6. “And it's also, you know, yeah, so it's incomprehensible to me that these folks still think that it's like an experiment that needs to be fixed. And second of all, that they have the solution, which when I look at the problem of settlement times, there are great solutions out there. I think my favorite solution is lightning and this idea of anchoring channels inside of, and forgive me, Peter Todd, but inside the time chain, that this is the way to get instant settlement in kind of a game theoretically secure manner, not to tinker with the base layer, but to build layers on top of it. So, yeah, the direction that reasonable people are going in and in particular, I'd point to folks like Jack Dorf.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  7. “Global settlement network that is working. And when people propose to fix it, I scratch my head as to what they're going on about. Because if it was broken, it wouldn't be settling trillions of dollars worth of BTC, like period. Nobody would use it for that.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  8. “Yeah, and I think that when we talk and think about Bitcoin, sometimes we slip into thinking about it as an experiment or as a hypothetical. But when we look at the actual data, even last month, right, we're like in this terrible bear market. Even last month, the Bitcoin network, the hashers finalized more than $2 trillion worth of Bitcoin transactions. And over the past 12 months, it's north of 50 trillion dollars worth of Bitcoin transactions. These are extremely material amounts of money, even in the traditional financial system. And so this is not an experiment, right? This is a lot.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  9. “Of the ordering of transactions is unless they're trying to do a 51% attack, but that seems to have been more theoretical than actual something people are doing now. That's a whole other debate of why is nobody 51% attacking Bitcoin, et cetera. I think that's the kind of the practical impact for users trade-off between decentralization”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  10. “External time Oracle in the sense that the nodes and the hashers are relying on their own system clocks, but to a much lesser extent than any of the competitors out there. And then especially with regards to stakers, because the fundamental problem with staking is that the stakers do not have to commit themselves to any particular timeline, right, or to any particular history of the sequencing of transactions. And so they can create many different sequences in parallel and then opportunistically reveal one in order to extract value somehow. Whereas with hashing, the hashers are always dedicating themselves to whatever the latest version.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  11. “Whereas, if we're saying every 10 minutes, you know, plus or minus half an hour and really, you know, even further out than that, if you look at kind of the distribution of hashes, that we're making a trade-off. We're saying, hey, look, we're going to have less precision in time in order to have greater decentralization, greater robustness, and ultimately a more reliable system, ironically, right? Because some might say that having to wait an hour for a transaction makes it unreliable. But guess what? Your network being down like Solana has been, for example, or others, and I don't want to like throw them under the bus, but look, that's a greater problem than what we're talking about with having to wait a little bit longer for a transaction. So, yeah, I think that Bitcoin ultimately still is dependent on an”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  12. “In other contexts, but it is necessary for decentralization and that ultimately if we did depend on a centralized timekeeper like, for example, there's NTP servers that are time servers essentially that are centralized, then the people who maintain those servers could reorder transactions on the ledger. And if there's, you know, Now arguably, this is what's going on with the whole proof of stake stuff that they're using centralized servers as Oracles. This, you know, I think that it's true in a sense, but it's really about the fact that they're trying to maximize throughput. And so they're trying to minimize latency. So I think the reason. That Bitcoin's relationship to time is decentralized is because it is so loose. That is that if we were trying to have a block every second, our clocks would have to be that much more precise, right?”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  13. “Yeah. So I think that from the user's perspective, it's somewhat irrelevant. And so it's like as long as the correlation between the work and the hashing and the time is close enough, that really the impact on the average user is that they'll think that, for example, a Bitcoin transaction three confirmations on average 30 minutes. And maybe for their transaction, it turns out to be an hour, even though it was included in the first block. And it's just because of the variance in terms of block time. And so I think that brings it home for folks of, well, this is not a process that is as controlled as you might have.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  14. “Substitute than that notion of time. And arguably, this goes back to kind of the metaphysics of it. There is no better thing than time because as many commentators have pointed out, time is the scarcest resource there is, more scarce than energy and certainly more scarce than hard drives or other things that we could try to come up with. And so I do think that time chain still has legs. I think that though there is tremendous nuance in terms of the fact that, hey, look, this is not a substitute for your atomic clock. This is Bitcoin time, kind of like dog years, right? Like this is from the perspective of This system, which is going to not really be relatable to other external systems that you might be familiar with.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  15. “Well, the example he gave was an altcoin, Chia that does this proof of space with the hard drives. Sometimes Peter Todd does make statements where I'm like, okay, this is probably a little bit speculative, but his point still stands that the time aspect of it is an implementation detail, arguably. Now, GJ does not agree, and I'm flip-flopping on whether it is an implementation detail or not because I think that to the extent that nobody has come up with a superior thing other than system time in order to regulate the blocks and the ordering and kind of how are we ordering, right? 10 minutes, right? Is what we're using. And I haven't heard of a better”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  16. “But the interesting point Peter Todd made was that these references to system time could be replaced with other things. And that was give us an”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  17. “That's true of all the consensus rules they are verifying in a block. But you're right that on the difficulty adjustment, the nodes are just looking at the timestamps that they previously verified and averaging the intervals on those.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  18. “Timestamp is not too far in the future or too far in the past. Now, there are blocks where it looks like there's negative time between them because one had a timestamp that was a little bit in the future, but it was within the parameters that are deemed okay. And so it is important for your Bitcoin node to have the correct time when it is accepting blocks and verifying blocks so that it can make sure that it rejects a block that's violating the rules and to make sure that it does not reject a block that is not violating the rules. But yeah, so that part of verifying a block does the nodes do refer to their system time. And that's decentralized, right? Because each node is looking at it from their point of view.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  19. “Well, each individual node is using its system time to check the past two weeks worth of blocks and to, well, you know, okay, you make a good point here, actually. I'm being inaccurate because the only system time input is, in fact, you're right, by the hashers, or probably the mining pools rather than the hashers. But in any case, let's conflate the two. And so what the nodes are doing is that they're taking each one of those timestamps from the past 2016 blocks and figuring out what's the average interval between those. And you're right that they're not looking at their own clock, except that it's just like layers of nuance, except that when a node is accepting a block, they do make sure that the block”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  20. “That anybody has made that mistake of saying, hey, let's meet up for our steak dinner at this block height. And then because blocks came in a little bit slowly or too quickly that they missed their reservation. But it is an interesting point. If we're trying to be as precise as possible, it's not so much that the proof of work hashers. I think it turns out hashers is like the only sane word we can use here because they're just generating hashes. They are contributing work and the time element of it, the timestamping element of it is actually secondary. And so they are ordering transactions based on accumulated work. And that is loosely correlated with wall clock time. Now, the difficulty adjustment does directly use time, but with a lot of averaging going on and a lot of plus or minus.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  21. “Average block interval would be eight minutes, for example, instead of 10 minutes. And so that means that on average you're like compressing time by 20%. So it's like interstellar. There's different periods of accelerated time in Bitcoin, which is why things like Bitcoin halvings, we don't know exactly what day it's going to fall on in the future. We know what block height it's going to fall on. And so to the extent that the block height is different than the real time, then we can't claim that Bitcoin is a timekeeper or a clock because that from Peter Todd's point of view would mislead people into thinking that they can use Blockheite as a substitute for their system clock for real time. I don't know.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  22. “The time on the chain can diverge from what we might call your wall clock time. Now, then we get into really metaphysical things of like, well, your wall clock is also not accurate. So take that into account. Even an atomic clock, you know, the most accurate, these things drift. There's like time is relative. Then we get into Einstein and some more advanced physics that I'm not an expert in. But basically, in terms of Bitcoin time, it drifts a lot more than that, right? And the reason it drifts, so there's a number of reasons, but one of the major ones has been that hash rate has increased parabolically at times. And because the difficulty adjustment only happens every two weeks worth of blocks, you can have two weeks where the”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  23. “Yeah, so for example, you could imagine a chain fork where one side of the chain has a lower difficulty adjustment than the other side of the chain. And so they might be further ahead in terms of the number of blocks, but they're behind in terms of the work, the hash rate. And so in a way, it's kind of an edge case, but it's also the case that So that's one thing. The other thing, though, that is perhaps more relevant to the time chain conversation is that”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  24. “Paper, then if I recall correctly, in his implementation, he might not have actually had that bug. I think that there was kind of a disconnect between the white paper and the code, and the code was correct, which. Is interesting because nobody reads the code, right? Everyone reads the original white paper that has since like essentially been superseded and that we should probably be amending as a living document if people are going to take it as canonical. This is like the US Constitution.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  25. “Of the service that's being provided to the network, it's more of an ordering of transactions temporally through time as it happens, although that's when Peter Todd threw some sand in the gears of my thinking here, which is that Satoshi made a mistake. Satoshi was a genius, but he didn't get everything perfectly right. And he actually did make a mistake of talking about the longest chain being kind of the chain that you build on top of. But as it turns out, it's the most work chain, the heaviest chain, as they say. So basically which chain has received kind of the most hashing power rather than which one has the most blocks, which can be different. And so that was actually a bug that Satoshi had in the white.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  26. “Transactions are ordered by physical time and space. That is, the gold can only be in one place at a time, and it gets moved around. Now, of course, the paper Bitcoin conspiracy, or sorry, the paper gold conspiracy theory stuff about, but fractional reserves. We'll get into that. In my view, I like the word timestamping. I like distributed time stamping. Maybe part of it is just an argument from authority of, well, you know, that's what Satoshi said. And so I was putting out some content of, hey, let's consider this word timestamping as being more relevant and more accurate than the analogy of mining. I think that the mining analogy, we should continue using it when we're referring to the subsidy and to the lack of senior edge revenue from miners. But in terms of...”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  27. “The analogy kind of breaks down at that point. And it also breaks down on the service that they are providing to the Bitcoin network. That is that when The Bitcoin nodes and the peer to peer network are essentially creating a decentralized order of transactions and some have analogized this to a clock or timekeeping, which is subject to controversy here. We're going to get into it with Peter Todd. But basically the idea is that in order to have a decentralized electronic cash system that is a ledger, you have to have an order of the transactions being added to the ledger so that you don't accidentally or intentionally spend the same Bitcoin twice. And that's the famous double spending problem that is solved by proof of work and the difficulty adjustment. So it really is about ordering transactions, which again, if you look at what gold miners do, it's completely unrelated, right? Gold”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  28. “They can just create trillions of dollars instantly. And they have done that. So that was Satoshi's analogy was here is a costly way of adding this asset to the ledger such that nobody's kind of in a privileged position of inflating the supply. So I think that analogy makes sense, except it quickly breaks down if you try to expand it to describing all the activities that a miner is performing. That is one, the subsidy, that is the new Bitcoin being added to the ledger, that's not their only source of revenue. They also are earning transaction fees, which are not new Bitcoin being added to the ledger. They are from transactions that are being included in a block by that quote-unquote miner. And gold miners don't do that, right? Gold miners don't include gold transactions in their extracting gold from the earth.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  29. “Right, because Senior Edge comes from having a monopoly on the issuance of the monetary asset and thus allowing you to have a monopoly profit on the difference between the cost of production and the revenue you get. So with gold mining and with Bitcoin mining, it's decentralized and permissionless. So anybody anywhere in the world that there's gold, they can go mine gold. And so in practice, the gold industry, the gold mining industry does not have monopoly profits, right? It's competitive industry. And same thing with Bitcoin adding Bitcoins to the ledger. It's hyper competitive, right? It's actually hard to make money from doing that, hard to make a profit. Contrast it with, for example, like the Federal Reserve, when they go into their SQL database, they have a cost of production of basically zero, right?”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  30. “Be misleading or verifying transactions, which I also think is extremely misleading. And so I went back to the white paper, of course, right? Let's see what Satoshi Nakamoto said. And he said two things. One, it's a distributed, it's an example of a distributed timestamping server, or it's an implementation of one. And it's a decentralized, right, distributed. The second is that he does use Golden Mining as an analogy. But the specific context in which he's using it is about the subsidy. The subsidy is the part of the block reward from the miners get that goes and adds Bitcoin into circulation, right? That's what gets cut in half every four years is the subsidy. And that's what Satoshi was analogizing to gold mining, which is here's how you add the units to the ledger such that you don't have any signurage.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  31. “Monetary systems, you know, except for literally gold mining. On top of that, just lots of different columns with kind of policy related folks where the connotation of mining is one of environmental devastation, right? That you're going to be, and also terrible working conditions. So, you know, people think about like coal miners going deep underground. Huge respect to coal miners, by the way. I don't have any negative connotations towards actual physical mining. I think that It's a fantastic industry and I don't have any animosity towards it, but it is very different from what Bitcoin miners do. And so I was thinking about, well, okay, what would be a better word? And I've heard phrases like digital mining to try to, you know, kind of move things in the right direction, securing the network, which I find to also.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  32. “That part of it is actually just related to the word that we're using mining to describe what the industry does. So for example, I was on a panel in Bjaritz at Surf and Bitcoin, and the moderator mentioned that they were on a tropical island and they met the prime minister, I believe, and they had lots of geothermal power, the cheap electricity on this island. And so he suggested, well, you know, you guys could mine Bitcoin here. And the prime minister's reaction was, how do you know we have Bitcoin here? How do you know there's Bitcoin on this island? And I was like, what? People take it because the word mining has always referred to physical, mineral extraction from the earth, right? It's never referred. To thinking or payment processing”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT

  33. “And I just started a new role at Riot Blockchain, which is one of the biggest publicly traded Bitcoin miners here in the US. And I joined about a month ago as their VP of research after working at Kraken for almost three years as a product manager for Bitcoin and Lightning. So a big change of subject area for me from kind of the exchange trading slash lightning payment side to the mining slash electricity side. So what I've gathered from talking to a lot of folks in the mining industry over the past month, and if anyone listening to this is in the mining industry, I'm happy to chat my DMs are open. We can hop on a call. Happy to talk to anyone really and learn from everyone. One thing that I've learned is that there is widespread misunderstanding.”

    2022-09-14 · We Study Billionaires · BTC095: Bitcoin Time Stamping w/ Pierre Rochard (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT