 Hi, I'm Christy Harkin. I've been Bitcoin Man magazine's managing editor for the past four years With me is Andreas Antonopoulos a long-standing Bitcoin evangelist and educator and author and speaker Andreas welcome to the Bitcoin magazine having Event so great to have you here couldn't do it without you Thank you so much Christy. It's a real pleasure. I've been a huge fan of Bitcoin magazine ever since the first couple of Editions in fact, I remember one of the first editions was sold to me at a conference by a Very nice young man by the name of Vitalik Buterin Great. Yeah, he started it all off and running and we've taken it in lots of different directions since so this is your third halving and And so we're going to be getting your perspective on the state of Bitcoin for each of those separate epochs and Get some ideas of what you see coming in the next one because goodness knows there's a lot of exciting stuff coming down the pipe Absolutely. Yes. I was lucky to just about catch the first halving in 2012 So lots of excitement. I came in halfway halfway between number two and number number two and number three Or no between number one and number two. Yeah, so this is this is my second So, yeah, wasn't much of a big deal when we did the second one I think in fact Aaron van Verden had an article saying we had the halving and not much happened But it's always in the weeks and months and years that follow that things get interesting So if you're to look at the first three and a half years or so of Bitcoin four years leading up to the 2012 halving, how would you characterize that period? What was what would your impression of that be? I? Think those were the obscure years Bitcoin was very much an obscurity and Very very few people had even heard of it and Had any idea what it was so the the user base was tiny the Community was extremely small. I remember going to the first conference in San Jose and meeting Basically, everyone the entire Bitcoin community almost at the time that was in the US was there and You could fit everybody in a room It was quite quite tiny There were a few interesting areas little pockets of development. I know that I think by By 2012 there was a London conference happening There were some Meetup groups all sort of springing up in lots of different places. Were you involved in the meet-up scene back then? I had just started getting involved in the meet-up scene. Yes I co-founded two meet-ups in the San Francisco area, which is where I lived at the time Yeah, and I think that now in terms of say development of Things being built at the time. What were some of the most striking things from the the brief Halving number one that really stood out as markers for you that showed that we're gonna actually go somewhere with this. I was really excited at the time with a Very interesting new technology called p2sh or pay-to-script hash with the emergence of a new form of address which Started with a three instead of a one something that's very familiar to us now, but in 2012 that was new until then the types of scripts that you could put into Bitcoin transactions were severely restricted. So there was a fundamental test that occurred in the system For standard scripts, there were a few standard scripts that were Let's say approved by the consensus rules. So after the initial launch of Bitcoin developers went in and they identified a few bugs that Satoshi had overlooked some edge cases some Difficult scenarios that could emerge and in order to protect against certain types of bugs The code was changed and the Bitcoin script was restricted with a lot of the kind of more exotic capabilities disabled and this number of scripts allowed Limited and so by 2012 that started opening up and things like multi-sig Really started to expand at that point So you could you could do some really interesting things with multi-sig as well as more complex scripts started becoming possible And when you say that like those kinds of developments really opened up things like multi-sig Why was that important? Why did that make Bitcoin more usable and more have more potential? Well because When the the primitive building blocks that are in the script language are expanded it starts kind of tickling the Creative brains of people who are thinking about these things and they gradually come out with with some really strange radical and exotic ideas that then take years to come to fruition, but eventually become very important innovations so for example the use of the op return parameter to Be able to embed small amounts of data which created the possibility of the first second-layer capabilities colored coins count a party Omni or master coin as it was called at the time which then Gave people like Vitalik Pateran the idea of making more expressive scripts that led to Ethereum a lot of people don't know that Vitalik started trying to build Ethereum as a layer on top of Bitcoin using the master coin Layer all of those capabilities opened up with the opening of the script types in 2012 so The door opened then and then the innovations continued to trickle out Segwit and its possibility of being implemented as a soft fork in 2017 was based upon Some of the peculiarities of the script language the lightning network which appeared as a fully fledged idea with an implementation design effectively two years three years later was based on the capabilities of Complex scripts and multi-sig at that time so it takes a while For primitives to become fully fledged ideas and for people to build interesting things with these Building blocks and then for those ideas to become workable code and then deployed networks and then finally features in user wallets But those of us who are paying attention and and kind of can see where things are going when we see these doors opening at the primitive layers of the protocol can kind of see where that might lead and so Start imagining new things When I was thinking about the first epoch I started thinking like if I had to sort of put a chapter heading on it or something I was thinking something along the lines of what is this Bitcoin? What is this and what can we do with it? And yes when we look at sort of the the timeline of things that did happen, you know We're getting first experimentations with exchanges. We get our first couple of bubbles. We get experimentation with different forms of wallets and you get the HD wallets starting to come in and how that opens everything up So if there was a lot of the whole like you've just got a brand new toy, but you don't know what to do with it yet and then following the second in if you I mean in a way the Havings are kind of Arbitrary benchmarks if you like it's all coded in and one thing doesn't necessarily lead to the other But it's an a useful parameter. I think for us to think of these My as milestones and and what can we say about the periods in between? So the second one I was thinking of in terms of so from 2012 to 2016 sort of as an experiment build and break Section there was a lot of experimentation a lot of building and a lot of breaking a lot of a lot of stuff went down in those four years There's and a lot of regulation started coming in people outside Started looking at Bitcoin and going what is this and what do we have to do about it? In fact the first encounter I had with you Followed your speech to the Canadian Senate on what was Bitcoin and how Whether or not Canada should be regulating it So, how would you look at how would you look at that section second period of Bitcoin? Well, the the second period of Bitcoin. I think is when people outside of the very very small community started taking notice and a lot of things Good and bad happens. I remember 2013 as being this absolute tornado of a year where so many things happened in one year that It was a transformational year for my personal involvement in Bitcoin But but also a lot of a lot of really Shocking and exciting things happening And what really what's what comes to mind specifically what what is your what's the one thing that really stood up for you then? Well for for me it was back-to-back the appearances on the Canadian Senate floor as a witness as well as Shortly thereafter at the Joe Rogan experience podcast which has an enormous audience and kind of catapulted me into Recognition in a way that I wasn't really ready for or anticipating It was the beginning of my work on Mastering Bitcoin the book. It was the first big rally where people suddenly got Very excited some people got quite rich and some people got quite greedy and that led to a slight change in the perspective of Outsiders who were now more attracted to the possibility of quick riches it was the beginning of the first altcoin and Ico fever and Just just an overall crazy year I also remember it was the first time we saw some real cracks in The ability of empty gox which at the time was an anchor kind of bedrock exchange the only really big exchange that existed and it really creaked under the strain and Threatened to fall over which which kind of presaged what was going to come next which was the biggest Collapse of a custodial system in the history of Bitcoin Yeah, the the other thing that I think another kind of big ish event that happened right after It was right after the the first halving was the takedown of silk silk road as well Which was one of the first big big use cases for Bitcoin yes, absolutely and and the shockwaves that sent through the the community and forced people to Reckon with the the the moral ethical implications of this technology on both sides Yeah, those were two narratives that Bitcoin really had to handle a deal with was the the silk road side and the collapse of mount gox so you had the whole that whole sort of Bitcoin is for criminals and It's not safe, which I think that took several years really for Bitcoin to Really recover from and get changed the story and change the narrative and prove its its actual value Yes, it was it was a big setback Which I think set set back the whole narrative by probably a couple of years then again, what it also did was it took the steam out of The the speculation and the anticipation of riches which again allowed The community to refocus But I find those periods the busts that follow the booms to be periods when there's a clear out in the community and a lot of the Opportunists Who have kind of flooded in in order to take advantage of the rapid rise in price and to stake a claim and Things like that they get washed out And what stays behind is people who it may have entered the space looking for Some kind of financial gain, but then are attracted to some of the principles and Then stay and want to learn more about why it matters. Why it's not about the price why it's about openness and freedom and the lack of control and intervention and censorship and Of the traditional financial system and so we have some very good conversations It's also a great time for those of us who are doing work in the space to Be able to tone down the noise and and really focus on what matters and get down to work Because when the craziness is happening during the boom cycles, there's too much noise and too much distraction And It's very difficult to to get any real productive work done. So I ended up finishing my book during the next two years and Got a lot of work done building kind of education And we we did some of our best work And I think the same thing applies with the core developers who were working On a lot of different things a lot of people produce some excellent work the Lightning Network paper was published at that time Ethereum launched and started a whole new interesting chapter in this saga and And you know Everybody got ready for the next boom cycle the next having and it didn't take that long And that's what I would have probably be be labeling the third the third epoch that 2016 to 2020 was boom and bust And also sort of the boom of the new financial products that started coming out I think that everything sort of All of that initial interest that keep that started in the second epoch really exploded in the third one And we got a lot of the institutional Interest in Bitcoin Yes, and It's more than just the institutional interest in Bitcoin I think one one of the things that happened that was really interesting is the second to altcoin and ICO season because Everybody remembers the altcoin and ICO season in 2016 2017, but most people forget that the first one happened in 13 and 14 We had ICO is then that's when the term was coined right and it and then In in 2016 2017 what happened however was that Ethereum proved One of its fundamental Propositions, which was that it made it so easy for anyone to tokenize anything and with that came The the double-edged sword that it made it so easy for anyone to tokenize anything That everyone tokenized everything including things that shouldn't have been tokenized and altright scams and we had the a much bigger second round of altcoins tokens and ICOs and When the space exploded in financial terms in 2017 That's when every shark in a suit piled on You know some people like to call that The institutional interest in Bitcoin I think of it as sharks in suits Circling at the smell of blood in the water and hoping to get a piece of chump for themselves Because the most of it wasn't serious institutional interest. It was very very opportunistic. We didn't get The the creme de la creme of the financial services industry What we got is the bottom feeders of the financial services industry and they flooded But they've since a lot of been shaken out and now Exactly as soon as the boom turns to bust all of those opportunities get wiped out and Make grand pronouncements about how they never really believed in Bitcoin They're much more interested in blockchain the technology behind Bitcoin Which is kind of a sour grapes response to failing to Lambo It's it's really funny. But again, that gives us an opportunity then to Batten down the hatches focus on the important work Educate the people who are willing to stay and learn about the principles get prepared for the next wave of newbies And really start differentiating the signal from the noise Again, it's a very productive period for those of us working in the space That's when the Lightning Network was actually built was after the boom That's when I finished my second book mastering Ethereum might publish a couple of books about The Internet of money in the meantime, but the second big technical book happened then And here we are again So, where are we gonna go? What's what's the one thing pick because real quick now one thing that you were excited to see coming in the next epoch well First of all, I think that the same prediction that I made the previous two havings applies again, which is that a Whole lot of nothing is going to happen and For now for now. Yeah, because The monetary effects If any and I'm not an economist, so that's not my primary of interest The monetary effects take quite a while To make themselves felt in the market more than the speculative enthusiasm that that kind of races ahead of any real fundamental change so What we're seeing now is this kind of frothy excitement That doesn't have much substance to it But that is overwhelming any possibility of getting some kind of signal from the market fundamentals It's gonna take a long time before the signal from them from the fundamental change in the inflation rates of Bitcoin's issuance Breaks through all of that noise and becomes a dominant signal that that really is is felt in the market But markets aside what what is exciting to you about what's going to be coming in the next couple of years? well, I Think the the most exciting two developments in this space are The changes the underlying scripting language that are almost ready to deploy and I hope they'll be deployed faster than our previous Change with Segwit and those are schnoar signatures tap roots and tap scripts that come as a package of changes Those open up again. It's as I mentioned before as in the first era They open the door. They create new building blocks on top of which a lot of exciting things can be built There's a couple of other potential changes to the scripting language that are being proposed that Massively increase the flexibility of the scripting language without making it turn complete and those are very interesting The other area of development is the maturation of the lightning network to me The lightning network until now has been primarily a fairly raw and kluji Protocol implementation a prototype that is gradually getting polished but the rough edges have mostly been polished off and We're getting to a point where the user interfaces in the lightning wallets the infrastructure the reliability of the system the consistency of the experience etc are beginning to Shine through all of the efforts that have gone into the last two years of running production networks are bearing fruits And I think that's going to monumentally impact how Bitcoin is used how it's perceived and Really transform the environment Until now a lot of what we are doing with Bitcoin at least on the surface With stuff that you could also do with traditional financial services Lightning opens up a whole new dimension of time and space In terms of time we're talking about transactions that take less than a second to be fully cleared irreversible and trusted and Where you can do thousands of transactions per second potentially and in addition to that the Opening up of the dimension of space where until now the minimum transactions you could do viably on Bitcoin was about a dollar to ten dollars and We're going way below that to Subcent transactions true micro payments and even nano payments below that That open up a whole range of applications. What's interesting is that now we're talking about applications That are unprecedented But simply do not have an equivalent in the traditional financial and payments industry and once we start exploring those That's when this technology really comes into fruition That'll be really exciting to see in the next couple of years and and beyond even but Would be good to resume this conversation again in another four years and see where we are and what else has popped up As a you know really promising development everything moves Exponentially quickly as well from where things were every four years. Who knows where we're going to be in another four So, yeah, I think though a lot of people are Anticipating something momentous happening at the moment of the halving because it's been pumped up by all of the reports And we talked early about milestones, you know milestones You know the word comes from markers that were put up every mile on our on Roman roads and Just like when you when you pass a mile marker not much changes in the scenery The halving as a milestone will be completely uneventful in fact We hope it will be completely uneventful from a technical perspective. Yeah, the difference between blocks six twenty nine thousand nine nine nine and 630,000 Is going to be nothing It's going to come across as an a somewhat anti-climactic Experience because within that experience We will see the Fundamental experience of Bitcoin and the fundamental experience of Bitcoin is tick-tock new block. That's it Perfect. It just keeps doing that It's dead. It's about to die. It's for criminals. It's not for criminals. It should be regulated It shouldn't be regulated all of that noise and in the meantime what Bitcoin does in the background is tick-tock new block and Continues to chug along 24 hours a day 365 days a year Unstoppable that's what is that's remarkable. That's the remarkable thing about it Exactly, and that's what's gonna happen during the halving nothing's going to happen because by design Nothing is supposed to happen and then once it's worked then people can go back to oh it didn't die and Now we can we can see what the economic impact might be or other things that will come as a side effect of that Everyone will breathe a big sigh of relief except for those of us who are kind of grizzled veterans who've been through this before and we'll continue and Everybody will forget all about the halving in three and a half years from now I'm going to be explaining it all over again to journalists that are going to be asking me about the possibility of a death spiral imminently Which happens so often when you know new people come across this technology and misunderstand it quite dramatically No That pretty much sums up I guess all of the good stuff. Thank you so much Andreas for doing this again and We'll see you in another four years If you enjoyed this video, please subscribe like and share All my work is shared for free. So if you want to support it join me on patreon