It’s always a pleasure to hear from Dr. Craig Wright, especially when he’s interviewed by an excellent host with a solid understanding of Bitcoin’s fundamentals and the industry in general. Dr. Wright was recently interviewed by CJ from MM Labs to share his thoughts on Bitcoin, the digital currency industry, and a whole lot more.
Straight in at the deep end—Electrum SV’s statement on seed phrases
In a recent statement, some Electrum SV developers stated that the BSV blockchain would eventually get so big that seed phrases won’t guarantee access to your bitcoins.
Dr. Wright says this is a misunderstanding about how Bitcoin works. He gives an example of a true peer-to-peer transaction using the model of Alice and Bob. Dismissing the notion promoted by anarchists that Bitcoiners should be unknown to each other, he says that details of transactions being known are desirable. For example, to use a warranty on a product you’ve purchased, the dealer needs to know who you are and requires proof of the purchase.
Drilling down on the point, Dr. Wright points out that seed phrases do not guarantee access to Bitcoin anyhow; they guarantee access to keys. One can simply search for the header rather than searching the entire blockchain (looking for a needle in a haystack). Concerns about the blockchain becoming too big to search effectively are unwarranted because there’s no need to search the entire blockchain in the first place. Furthermore, he says that services will spring up to help people, such as wallet providers that do this.
Ultimately, Dr. Wright dismisses the Electrum SV developers’ concerns as “looking back at many years of BTC mentality that have permeated Bitcoin.”
Bitcoin does not allow you to be your own bank—it’s digital cash
In 2012/2013, Dr. Wright purchased the source code for the AMAL product, an Islamic banking product. He had also worked with Temenos, a large core banking platform. Through this process, he came to understand the requirements of banking software better.
What did he do with the banking software? He integrated Bitcoin into it. He intended to increase the scope of what was possible and build a system that would work with the banking software. He found that one of the systems that worked best was associated with Islamic finance. In these systems, banks have real skin in the game. They take a stake in the firms they are financing, and they help manage them—proof of work signals this kind of “skin in the game” in the Bitcoin system.
Referring to the myth that Bitcoin allows you to be your own bank, Dr. Wright dismisses this as “absolute crap”. He reemphasizes his point that Bitcoin does not give loans or provide the sort of services that banks do. Instead, Bitcoin is digital cash. He says that it can solve many of the problems faced by the unbanked and global poor, allowing them to interact with the world financially.
“It means people earning $1 a day or $2 a day can interact with cash again securely,” Dr. Wright says. He points out that Bitcoin is different from banks. It’s something totally new; a working digital cash system.
Why are Silicon Valley tech giants so opposed to the original Bitcoin design (BSV)?
Dr. Wright says that Bitcoin has been in a covert cold war with the tech giants since 2012/2103. He no longers believes this war is covert in nature. Pointing out that Meta has joined COPA, he now believes they are very actively and openly at war with the original Bitcoin.
Why so? Because they are ad-based and Bitcoin (BSV) threatens that business model. While firms like Microsoft and Amazon make money from selling goods and services, the likes of Meta, Twitter, and Facebook make them from selling consumers.
“You are the product,” Dr. Wright says.
Dr. Wright believes they are profoundly negative for society, outlining the tracing, tracking, and virtual spying these companies engage in to enable their business models.
“It’s a technocracy that is overarching and taking control of our lives,” he says.
The alternative to this dystopia is a paid society based on micropayments. For example, Dr. Wright says he would pay for a Google search free from ads that just gives him the best result. The trick is to make the payments small enough in value that nobody cares about paying them. The micropayments model would reintroduce competition, which he says the Silicon Valley giants want to avoid. They prefer to be monopolies that stay in charge and in control.
Likewise, if you pay to Tweet (as on Twetch), lots of the rubbish gets filtered out, making it expensive for bots to operate on these platforms.
Has anything been released since 2009 that is competitive with or at least a worthy adversary to Bitcoin?
Dr. Wright answers this one with a flat no.
He says that most people haven’t bothered understanding Bitcoin and are still focused on concepts like “decentralization” that have taken on near-religious connotations. They haven’t figured out how Bitcoin scales or how it works.
Briefly touching on competing systems like the Lightning Network, he says they’re trying to base it on a mesh-based network, but that Bitcoin was designed as a small-world network.
Is nChain looking into providing a hardware wallet since the existing ones (e.g., Ledger) don’t support BSV? Is there a plan to have something similar to Meta Mask?
Dr. Wright rejects both notions as stupid things invented by people who have no idea what Bitcoin is or how it works. He says that systems like hardware wallets do the opposite of making you more secure. He says that opening a window on a submarine would be safer than Bit32, the system many of these things are based on.
Pointing out some of the obvious flaws with such systems, Dr. Wright says that they reintroduce a trusted third party, and they exist without linking identity to keys. They’re also not particularly easy to use.
What’s the safest method to store Bitcoin? Dr. Wright says that firstly it should not be held for speculation and should be used as cash. However, if someone is holding, then having keys linked to identity is one way. Setting up wallets in multiple locations, having time-locked transactions, and having key hierarchies are other ways to keep coins safe.
A brief chat about the Canadian trucker protests
The conversation then veers into what recently happened in Ottawa, Canada, with the Canadian trucker protests. Dr. Wright does not support the truckers’ actions and says that taking over property is always wrong. He says that they could easily have gone on strike and stayed at home, which would have brought the country to a halt if they did so in large enough numbers, and this would have been an effective way of making their point without destroying property, blocking access to people getting food, etc.
How much traction is BSV gaining with enterprises and governments compared to competitors like Hedera Hashgrph and DAG?
CJ points out that some of BSV’s competitors, such as Hedera Hashgraph and DAG, have recently landed large corporate and government contracts. He wants to know how BSV is faring by comparison.
Dr. Wright dismisses many of these so-called ‘partnerships’ as marketing gimmicks. He likens them to how Ripple claimed it was being used by banks when in fact, banks were just testing it, and none of them actually use it.
“No one in the real world uses hashgraph,” Dr. Wright says. “Hashgraph doesn’t work and won’t ever work.” When asked to dig deep on the difference between the likes of DAG and blockchains, he responds that there isn’t anything to talk about because it’s “just technical bullsh*t.”
Lamenting the complexity of these systems, Dr. Wright reminds us that Bitcoin works because of its simplicity. This is misunderstood, and people keep making things more and more complex.
As for BSV, there have been a lot of conversations behind the scenes, but Dr. Wright doesn’t want to talk about them to pump the coin price. He says that BSV will win on transaction volume and cost. By the end of the decade, he wants BSV to be able to handle 10 billion transactions per second at a cost of one-thousandth of a cent. Contrary to popular belief, Dr. Wright says the best technical solution does win.
Bitcoin and information flow
CJ asks Dr. Wright if Bitcoin could play a role in preventing censorship. He gives the example of RT, which has been cut off from Western audiences since it invaded Ukraine this month.
The answer is that Bitcoin can’t stop large aggregators such as Apple News and cable networks from cutting the likes of RT off, but it can give an alternative way for viewers to fund what they want to see more of. Again, this comes down to getting rid of the advertising model and replacing it with micropayments.
Price versus value
Dr. Wright has spoken at length about how most of the coin prices in the industry are based on nothing but speculation. While he doesn’t care what the price of BSV tokens will be, he does allude to the fact that building demand for them through use should increase their value in the long run.
Eventually, the price of the token will reflect use, and that’s all he wants to see. The most important thing is that the Bitcoin protocol does not change. This gives developers the confidence to build long-term projects without worrying that their projects will be rendered useless because developers changed the protocol.
Are XRP and Ethereum securities? If so, will they bribe their way out, or will they cease to exist?
The answer here is that, yes, XRP absolutely is a security by the very definition of the term. He says it is run by corrupt conmen, and none of the arguments against it being a security stand up to scrutiny.
He says that Ethereum will cease to exist for different reasons; it doesn’t scale, developers keep changing the protocol, and the fees will always be too high. He claims that even fees of a cent are too high for the use cases he envisions.
The BSV roadmap for the next ten years and final thoughts
Dr. Wright says that the main priority is scaling Bitcoin to billions of transactions per second. Other than that, tools will be developed to make interaction with the BSV blockchain easier. Single satoshi transactions will be possible this year as the dust limit is removed.
Watch: Dr. Craig Wright’s keynote speech “Keynote speech: Time is a Personal Experience” at the CoinGeek New York Conference
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