 Hi, I'm Matt. I Founded a Bitcoin company in 2014 been doing this for a little bit Got into Ethereum early 2017 and I wanted to talk to you about a project called tbtc Where we're bridging Bitcoin and Ethereum it we're doing this in collaboration with What we're calling the cross-chain group James press which summa and a couple other folks So why are we all here I Know some of us came for the unstoppable code Some of us came for the world computer, but the latest meme is DeFi So DeFi is around a half billion dollar market give or take the last month's market gyrations And there's this like I think we're excited. There's a new there's a new narrative But I guess my question is is is DeFi growing and is DeFi as exciting as we think Because when you look at half a billion dollars and you compare it to again, these are old numbers the 24 billion dollar market cap for ether You start to realize maybe we're actually going to hit a ceiling soon And so when you look at projects like maker you could other the other projects that are limited by collateral We're all kind of thinking how how can we get access to more value on this chain to do more DeFi? So some people are interested in security tokens or real estate. I'm not I'm interested in trustless assets So for me the next obvious pool of collateral is Bitcoin, which is a little bit bigger than than the other two So one way to frame this discussion is how can we bring DeFi to Bitcoin? That's a little paternalistic I think a lot of Bitcoiners who may or may not be watching this would be like Bitcoin doesn't need DeFi But another way to look at it is you know Bitcoin was was the first DeFi be your own bank now We have cash. How can we get loans? So I actually went to buy a house recently and I knew okay my most of my life's work is crypto This is going to be an interesting experience And so I started looking for what lender could help me out and and keep me from having to sell my crypto So I finally found someone I got really excited And so I talked to this mortgage provider and they were like, oh, yeah, we're totally crypto friendly We're so glad that you came to us and so I said cool. What do I do? They said sell your crypto just sell it and come back in 30 days We'll pretend like we didn't have this conversation and then you can buy a house No So, well, you know one way is how can we bring one way to look at this? Is how do we decentralize finance with Bitcoin? Another is how can we make Bitcoin available everywhere? So Ethereum has this opportunity to be an interop hub and to bring assets on to the chain to work with DeFi today How can we make Bitcoin one of those assets? But you know for the engineers in the room also just like when sidechains So we've been talking about sidechains and interop since at least 2014 probably earlier And so far they've been for the most part vaporware a bunch of L ones right now are working on bringing out something new But it would just be really intellectually satisfying to see a side chain between Bitcoin and Ethereum today So people have been trying to solve this problem Mostly through hacks So the first big hack that people have used are federations if you guys are familiar with WBTC in the Ethereum space Liquid in the Bitcoin space and the basic idea behind a federation Is that you have a bunch of folks that come together you trust them They hold your Bitcoin and then you know, they'll validate somewhere else So what's great about federations? You get your price exposure that DeFi is so interested in and you have a super simple implementation Okay, so anyone in this room, I imagine who has touched Solidity before could create something similar to WBTC today Which is great, so why are we here? So the reason that I joined crypto Was to own my own money. I don't know if you guys saw Taylor's talk from my crypto the other day But it was a little bit about back to basics. Why are we all here? We're here for individual ownership consent and sovereignty and the second you take a peg a federation based peg That's that's trustful. You've lost that so you've lost seizure resistance. You've lost You've lost any sort of like trustlessness of the system So the other big approach that people are using to get price exposure on Ethereum or synthetics Basic idea you guys are probably familiar is we lock up a bunch of ETH and then there's some sort of algorithm does something with it So that you peg a price to an external asset. So synthetics are great. There's censorship resistant So for example, if you have like something that's pegged to a stock on Ethereum You can be confident that that's not going to be seized from you. You get your price exposure And of course there are downsides So there there are two that I see so one is is just that it's it's dangerous The more synthetics you stack the more FX risk you stack and the more of chance of like a black swan event happening through all of our DeFi systems So if I asked you guys how much ETH would you be willing to lock up to be Confident that that amount was going to be more than one Bitcoin in six months I think we would all have different opinions on on what that is. It's it's a difficult problem And then the other thing with synthetics is you can't redeem them for Bitcoin so if I'm trying to convince my My Bitcoin friends from from the earlier earlier 2010s To use a system like this. They're not interested in ETH backed synthetics. They want to know that they're using Bitcoin on Ethereum So what's my desire? What do I really want that? I'm not getting from these two systems I'd like a censorship resistant fully Bitcoin backed ERC-20 token So no trust no KYC Confident that any attacker is going to lose money and that you can always get back to your Bitcoin So before I dive into the sidechain mechanism, I'm actually going to give you guys a super quick demo of what we got so far Just to kind of like make it concrete The way that we've piled up these videos. We'll see how it goes So this is TBTC It's a pretty straightforward DAP experience. It's actually a cross Ethereum and Bitcoin DAP You open up a deposit here You you fetch a BTC address So you actually get someone off-chain to give you a public key hatch And then you pay one BTC. You can use any wallet in this example. We use green wallet It's I guess not any wallet. It is segwit. We would rather not stick with legacy BTC And once this confirms I'm pretty sure I There we go. Good. You don't have to wait on the full 10 minute confirmation for this particular video You submit an spv proof to the ethereum chain showing that you made a bitcoin deposit And it's actually safe for For us to mint TBTC on the ethereum side Voila So what's the idea behind that? We're calling it a bonded multi federated peg which is a whole bunch of words relative to a pretty simple demo The idea is that side chains have talked about this two-way peg for years There are a lot of problems with federations that I've already talked about. So how can we fix them? One you can actually watch the bitcoin chain two You should not trust entire economies to 11 of 15 multi six and three if you're going to have to trust someone Get them to put down a deposit first So going into that in a little bit more detail in TBTC Every bitcoin that is deposited has a new dynamic federation that's been created So we actually have our own random beacon that we've built on ethereum And that is then going to sample validators and they're going to come together and they're going to create a new wallet To bond all of the federation members obviously you guys know what we're going to do with the bond But the basic idea is make sure everyone has skin in the game before you accept them as a validator Read bitcoin history. So again, if you're familiar with solidity, obviously, we're not really reading bitcoin history What I mean is someone off chain is providing spv proofs from the bitcoin chain to ethereum And then finally, what are we going to do with that bond? So if someone misbehaves we slash but typically when you're talking about slashing at the consensus level You just want to like burn it to the ground, right? You don't want that token to exist anymore and you want the person who misbehaved to feel it But here slashing is not just punitive. We actually use the funds that are slashed to make sure that That the peg is whole. So if someone does misbehave in a system like this Not only do we take their money we take their money. We use that to buy back tbtc and maintain the supply pack So I don't have a slide for this going off script a little bit But what do we need here? We obviously we need a price feed Um so Originally the the v1 spec of tbtc just has a centralized price feed. It's even simpler than makers makers v1 medianizer, right? And I put that out and I knew I felt bad as a system designer We were all unhappy, but you know, we wanted to get the main net faster But it was a lightning rod for bitcoin depositors. They just could not stand the idea of a centralized price feed So since then I don't know if you guys are around a couple days ago on floor six We've actually been whiteboarding a decentralized price feed alternative. We're calling it feedless feeds So interested excited really to share a little bit more with you guys about that, but i'm not going to go too far into it now so The other question that this brings forward is collateral So there's a 2.5 x collateral requirement for this naively I say 2.5 because I wanted to be honest and choose the big number But if you think about it, it's really more like 1.5 x collateral because there's liquidity on the ethereum side But actually through some cleverness and by allowing the bitcoin depositors to collateralize against each other You can get it down closer to 1.4 total collateral So some takeaways from this It is expensive to run. It's more expensive than getting goxed or sorry less expensive than getting goxed goxed is very expensive And it should be good for eth as well. We are still locking up eth and we do fall back to a synthetic in the case of misbehavior So, you know, it's dev con there are devs here I want to invite you guys to check out tbtc.network If you are interested in building dApps on bitcoin If you're interested in using bitcoin is collateral in your d5 project. Please come talk to me Talk to james press rich or one of these other guys who are who are all kind of involved with this project um It's going to be sweet And uh, thanks a lot. My name is matt longo. Uh, you can follow up a little bit more with the cross chain group as well So we've got three minutes guys if anyone has any questions around tbtc. I'm happy to give you guys some more details Okay guys, um, well that's everything I've got so thanks a lot. Looking forward to talking to you after