WBD064 Audio Transcription 

Defending Bitcoin with John Carvalho

Interview date: Tuesday 18th Dec, 2018

Note: the following is a transcription of my interview with John Carvalho from Bitrefill. I use Rev.com from translations and they remove ums, errs and half sentences. I have reviewed the transcription but if you find any mistakes, please feel free to email me. You can listen to the original recording here.

In this episode, I talk with John Carvalho from Bitrefill, @BitcoinErrorLog on Twitter. We discuss why John feels the need to defend Bitcoin, the types of attacks such as S2X and Bitcoin Cash and why most people shouldn't be trading.

“Shitcoins are called shitcoins because they are shit compared to Bitcoin.”

— John Carvalho

Interview Transcription

Peter McCormack: Hi, John. Happy New Year.

John Carvalho: Happy New Year. How are you?

Peter McCormack: I’m good, thanks. How was your Christmas?

John Carvalho: Oh, not bad. Not bad. Just visited some friends.

Peter McCormack: And are you all back to work now?

John Carvalho: Yep, back to work today.

Peter McCormack: Before we start, I just want to go to one of your tweets you sent recently. You watched the new Black Mirror Bandersnatch and you said it was annoying.

John Carvalho: Yeah, it was. I don’t know, it’s just different when you want to sit down and watch TV, you don’t want to have to … I had mine set up playing from my laptop but I was watching from the couch. So I kind of had to move to go and change it with the mouse and I was just like, “This sucks.” And I was hoping that I can at least watch and let it pick for me at random and I would get somewhere but it has a lot of loops in it. So eventually, just like, I just want to like … I want to be able to immerse myself, not just play with it.

Peter McCormack: Yeah. I wrote down that I enjoyed it as an experiment but I really prefer a storyteller to tell me a story rather than my pick. But one thing I found was quite interesting is that I don’t know about you, but I’ve always got my phone with me and I’m messing around with it, whatever I’m watching. You couldn’t do that with Bandersnatch, you had to put your phone down.

John Carvalho: That would have been a lot easier if I could watch it on netflix.com or on Netflix app on my TV and then hold the thing and can use it as a controller, it would have been less annoying. But I don’t know it wasn’t just that, it was just that the overall story … it didn’t make me feel so immersed. They tried a little bit, they were trying to say, “I feel like I’m being controlled by someone else.” And then when I stopped choosing, they said, “It seems like you’ve just given up.” Like in the lion set, I thought it was funny. I don’t know, after a while it just got boring, you know? The storyline wasn’t that good. I like the meta aspect, but it wasn’t that good to be able to … just clicking.

Peter McCormack: Yeah. I’ll let people know the spoilers, so if nobody’s seen it, they should probably just skip for a couple of minutes. But just out of interest, do you remember what your ending was?

John Carvalho: I may have gotten more than one ending, but the one I recall is … I got an ending where he got a five-star review for the game. And also he ends up fighting his psychiatrist and killing his dad and killing the programmer. This might be two different endings. But then you get a five-star ending, and then it goes even more meta and it shows … it talks about the girl that makes it, this Bandersnatch, she finds the old video game from the movie. And she makes the Netflix game.

Peter McCormack: Right, okay. I’ve got that in one of my loops, but my ending, the game didn’t get released and he ended up in prison.

John Carvalho: Yeah, I may have seen that one too. I don’t know. I got really passive when it was on, and I was just clicking things, and I was just fucking around on my phone. So, I forget what was what.

Peter McCormack: I do want to see the stats though, hopefully, they’ll release the stats because I went for the most macabre route. I was like kill everyone, chop them up, just totally destroy them.

John Carvalho: Yeah. They said there were five endings and like a trillion variations or something crazy. I don’t know.

Peter McCormack: The coolest thing for me though was the constant references to Metalhead, because that’s my favourite episode of Black Mirror.

John Carvalho: I don’t remember the names of the episodes. I do like Black Mirror a lot though. I think my favourite episode is the one with the point system, with the guy who has to jog and get points, and the girl turns into a cam girl.

Peter McCormack: Yeah.

All right man, well listen, I’m glad we’ve got to do this, it might never have happened. We can get into that. But I don’t usually do origin stories because they always exist, but actually, I kind of want to do yours because of what we can talk about. So, can you give me the background for you discovering Bitcoin and what the eureka moment was for you where you realised it was so important?

John Carvalho: I mean it didn’t start so flashy, it was just simply heard about the Silk Road, and how you could buy drugs online with Bitcoin. And that got me into reading about Bitcoin. A lot of people that started Bitcoin around the time I did have the same story. And when I actually started reading into it, I was just … my mind was blown. And I spent probably six, twelve months just fully immersing myself deeper and deeper and deeper. And everything just kind of clicked for me and I never got out of that black hole, that rabbit hole. Basically, from the first day I hopped into the Bitcoin TOC forums, and popped onto IRC and started chatting with people and stuff, it was done for me. Bitcoin swallowed me whole.

Peter McCormack: And a question I like to ask some people is not to get a functional description, because that’s kind of easy to get, but I do like to ask people what is Bitcoin?

John Carvalho: What is Bitcoin? Fuck.

Peter McCormack: Yeah.

John Carvalho: I’ll tell you what I tell people who don’t know anything about Bitcoin. When they ask me this question, I just tell them it’s like a way to have cash on the internet. And that’s really the simplest way to give it to somebody quickly that I’ve found, without having to get into the details. But then if they want more details, I’ll talk about how there’s no one company or person that controls it, so it allows people to not have to trust each other. And how it’s a push pay method, instead of a pull.

So, basically, instead of having customer protection, you have merchant protection. That’s kind of how I tell it to them.

Peter McCormack: Okay. And I’d also like to bring out the quotes. Usually, when I prepare the structure of my interviews I get quotes from people. I’ve got a few of yours here, but quite an interesting one recently is that “Bitcoin is a grind, it won’t just win a moment, it will grind everything inferior into submission kicking and screaming, swallowed whole.”

John Carvalho: Yeah, I was feeling a little poetic I guess. But no, that concept is important to me. I told you about how it swallowed me whole, and I really feel like there’s a phenomenal phenomenon aspect to Bitcoin where it has this extreme amount of gravity and the closer you get to it, the harder it is to get away. And I also think it’s important because people like to talk about Bitcoin as if it’s … as if it’s an obviously proven theory, and everybody should believe it and believe now. But people don’t think about the actual time that it might take, you know?

Yeah, I believe that Bitcoin will win, I believe that Bitcoin is the best. I believe that altcoins, and shitcoins, and ICOs are mostly a distraction and just capitalising on spectator’s greed. But, I don’t know how long it will take for Bitcoin to win, so I think it’s always important to think about the time and the struggles that it might have to go through to get to this ideal.

Peter McCormack: I think that’s quite an interesting point on the gravity as well, and I think maybe one of the reasons I had a disagreement not just with you, just ended up pissing up a whole bunch of people at once, is the timeframe of when you come into Bitcoin. When I came in, it wasn’t really just Bitcoin, it was Bitcoin, but very prominent other projects with the theorem on coin bases quite prominent among other projects. So I didn’t really have a huge frame of reference for why Bitcoin was so much more important than these other ones. It was a couple of things or a few things I had to learn about at the same time.

And it’s only over a period of say two years, and a year of doing all these interviews, 60 interviews, research, and speaking to people, I’ve found the gravity of Bitcoin draw me in. And I think that’s maybe why … I think maybe why when new people come into cryptocurrencies as a category, they don’t always understand Bitcoin maximalism straight away, or why Bitcoin is different and so important. Do you appreciate that?

John Carvalho: I do. I actually really appreciate that and your story in particular. It’s the perfect story of why I do what I do. I don’t know how much role I played in getting you there, but I was there in the beginning and this is why … I’m not known for being the most friendly or fluffy guy when it comes to people that want to argue on social media or even video, but I’m never lying, I’m never hustling, I’m never trying to deceive someone. And I spend a lot of time on it, and I have no idea why. I’m compelled to defend Bitcoin. I have no choice, it’s just what I do.

And when I work hard at it, and when I see someone that is refusing to try on these shoes just for a minute and listen, I do get frustrated, and I can be a little bit mean I guess. And to see how you went from really frustrating me in how you were responding and me just not even wanting to … I muted you, I just didn’t want to hear your noise. And eventually coming back and seeing some of the things you were saying months or years later, I don’t know how long it was, but I was like yes, okay, it’s not a waste of time. It’s too bad we can’t get these people earlier. We have to figure out how to get them earlier, but it does work, people do figure it out.

Peter McCormack: Right, I was muted. I thought I was muted. I tried a couple of times to engage, and I was like, “I know he’s ignoring me, or he’s muted me.” Look, I get it, and I think also at the time I was probably … I don’t know, my podcast had gone very well, and I had the ability to sometimes get a bit … I don’t know, I don’t want to say cocky, but maybe just don’t think things through. And I hadn’t appreciated the work that other people had done. And the turning point for me, actually it was two things. Firstly getting into arguments with Ripple Coiners. I kind of thought this must be how someone like John, or Dan, or Medium Squeeze. All these people just having the same argument over and over again.

There’s only so many times you can have it, and then you say, “I can’t be bothered anymore.”

John Carvalho: It’s not just that, it’s also that because we’ve had it so many times, we’ve developed an elevator speech for them, and we don’t take the time to give you detail. We can’t give every new person all the detail every time in order to say enough to convince them. We have to hope our shorthand is good enough because there’s just too much. I don’t know, there’s some good quote about this, like the amount of energy it takes to create bullshit is 10 times less than the amount it takes to refute it. I forget the quote, but it’s a good one.

Peter McCormack: And it’s quite hard to change someone’s mind, right?

John Carvalho: Yeah.

Peter McCormack: You come in with an argument, you kind of have to find it yourself. And the second turning point for me was … I’ve not said about this before, but I kind of had this idea for a book at one point. Doing all these interviews, I kind of had an idea for doing this book, which I don’t know if I’ll ever do because I don’t think I’m a writer, but in doing so I did a lot of research into the history of Bitcoin, the chronology. And I went through all the email threads from the S2X mailing list. And what happened was I was going through them, and it’s quite interesting, it’s almost like a who’s who of Bitcoin. All these people, these names that you see discussing.

And what was quite interesting is I noticed that there are a number of prominent names who were really not arguing against S2X, but just trying to technically ensure the right things were happening. So, someone like Adam Bag would just say, “Need to ensure that there’s replay protection, and SPV.” And a few other things, things I don’t understand by the way. And then I was seeing all these Bitcoin error log posts where you firmly just not having it.

John Carvalho: Yeah, because … look that was a really epic time. The SegWit2x, it was even years leading up to it, I’ve been in some way watching or participating in all of it. But I’m not a developer, so I’m not the guy making this code. And I think that … I don’t know, maybe it’s egotistical of me, but when I see people like Adam Bag and Charlie Lee being very even-handed and reasonable about everything, I think it’s just … it’s not enough, because the people that are trying to believe the wrong thing, or the bad thing, or the thing that they’re being sold snake oil about, they see that as permission to believe that when people are nice.

And so I feel like I don’t mind showing my ass, I’ll be the one fucking asshole screaming at people and being rude to them. I’m not even that rude, I’m just very candid, you know? I’m very cut to the chase, and I’m not accepting bullshit. And when I see people being nice, I want to make sure people realise the cold hard part of it and try that on as well.

Peter McCormack: So, what actually happened was, and it was quite a humbling experience, I didn’t read all the threads and all the messages, I kind of just went through the names of people I liked. And then obviously I saw a couple from you, and I’ve got quotes here. But there were a few things that you put in there…

John Carvalho: I don’t even remember.

Peter McCormack: I’ve got them here. Well actually quite early on also, I’ve got it here, I even wrote down July 25th, when you put, “Please remove me from this mailing list. This project and its supporters are a joke.” But actually, most of your points were even-handed. You weren’t rude, you weren’t aggressive, but you were defending Bitcoin rather than just having the same … rather than talking just about the tech, you were kind of saying this is ridiculous. You were pointing out that minor support would be futures pricing. But the thing that stood out for me, and explained it to me in a way that I’d never understood, it just didn’t cross my mind at the time. But I thought what was going to happen is it would be an upgrade, and Bitcoin would continue.

But you put in there, I’m going to read it to you, a hard fork can never be Bitcoin, and Bitcoin can’t even die. You’re not reaching consensus, you’re campaigning and competing. You are not Bitcoin, you’re using Bitcoin history as a proof of state for a new blockchain. And what I realised, yeah, this is just another coin. And then I ended up going through all the threads and just reading all your points, and I was like ah, shit, I think I need to write to John and apologise to him. I didn’t understand your background, what you had done. I didn’t obviously show any respect for it. And that’s quite a humbling experience to go through, but you got my message.

John Carvalho: Man, it’s the best compliment I can get in the space, honestly, for you to say that. Nobody ever says nice things when you’re somebody like me, you know? They just sometimes follow you and they think you’re interesting and fun. And it’s just … slapstick to them I guess, or something. But I do mean what I’m doing, I do mean what I’m saying. And it makes me really happy to hear that actually has an influence sometimes.

Peter McCormack: It definitely had an influence, and it influences my own personal behaviour. I can be annoying, I can be so annoying at times and I can put all kinds of bullshit out there. But going through that, not just yourself though, there’s other people and other things I follow. And the way I tried to explain it to somebody once is I’m not really that technical. I tried to learn to program once, I tried to learn JavaScript because I’d learnt HTML, and HTML is fairly easy, it’s just a mark-up language. So I was like the next natural step is JavaScript. And I spent months on it, and I didn’t really understand it.

And then just one day, it clicked, the order and the flow of creating a script. I was like, “Ah,” but I don’t know why it clicked. And I think that’s kind of what’s happened with Bitcoin. At some point along the line it just kind of clicked why it’s important, why it’s different from everything else, why it deserves so much focus and defending. And therefore, why so many other things feel like an attack on Bitcoin. I don’t know how that happens, but it just kind of happens, right?

John Carvalho: Well, yeah. It’s why people talk about the concept of Bitcoin being kind of like a sovereign sometimes, and I think … I like to hypothesise about the future and think people like us are Bitcoin’s army. And Bitcoin probably does need an army to defend its money. Monies in governments have been so integrated for so many centuries, why should we think that will stop? And it’s why I somewhat jokingly called one of my projects Bitcoin Tell Pro, was because I thought there would be a fun way to flesh it out into something that maybe eventually we’ll be able to organise people to have the same mind frame. It’s just a T-Shirt right now, but I do have bigger ideas. I just have too many ideas and try to do too much.

Peter McCormack: I think a lot of us do that. That’s quite interesting what you say about defending people’s money actually, because I watched a presentation from Luke Dash Jr recently, and he was talking about upgrades to Bitcoin and how when they’re considering upgrades always in the back of his mind, and I watched it a while ago, so I might not have this exactly correct. But always in the back of their mind, everything they’re doing they’ve always got to remember this is going to affect someone’s money. Any decision they make, any upgrade, any change to the protocol is going to affect Bitcoin that people own.

And therefore, I start to think about something like Ethereum and it feels like it doesn’t seem to be as much care and attention to the fact that this is people’s money with Ethereum. And that for me is a very clear difference. And therefore, when I ended up reading through Tuur’s Tweetstorm recently, I was very much siding with him knowing some of this stuff is probably not always correct. And then reading the responses, again, not everything was always correct, but I kind of felt like I warmed to the approach of the Bitcoiners and felt a little bit cold by the reaction of the Ethereum community.

John Carvalho: Well, what Ethereum succeeded at was capturing the hearts and minds of programmers. Young programmers and people that were interested in making software and things like this, they saw this as a way to integrate the concept of money and getting rich with fucking around making cool Apps. But in the end, that’s all it is, big role play, you know? And so you have to go into that community with wanting to be somebody that’s a builder and hang out with other builders. And just make things. Not really think too hard about the actual fundamentals of blockchain and Ethereum, and what it should be worth, et cetera.

And it becomes really hard to make them care about that because it pumped so hard, you know? It went up so much, and the humans in this space, at least they have a very difficult time decorrelating the value of something in the marketplace and the price of it, and speculation on it, from its actual success or usability. Yeah, I don’t like to see that happen.

There was another thing that I wanted to say that you made me think of. You talked about how Bitcoiners have been around a while when we explain something that kind of degrades over time. And I heard you mention … you said Luke was talking about an upgrade to Bitcoin. Well, in the first few years that I was around, Bitcoin maximalism was way more hardcore than it is now. Bitcoin maximalism is more like Bitcoin extremism. A real Bitcoin Maximalist, if you were around back then. The word didn’t exist back then, but a real Bitcoiner back then, you believe every single thing someone does to Bitcoin is an attack.

That includes small software upgrades from Core, that includes any suggestion of a hard fork from anyone for any reason. And so this is what I mean when I say that Bitcoin can’t die because you can always use the original copy. And the original Bitcoin will never stop being mined. Maybe someday a better upgrade that has full consensus fork will become worth more, I don’t know, I’m sceptical. I’m really sceptical Bitcoin can hard fork successfully.

But in the end, the only thing we can do as users thinks of every single thing people want to do to Bitcoin as an attack.

Peter McCormack: And you’ve been around for quite a long time. You’ve obviously seen the growth of Bitcoin. You’ve seen how in the last year there’s been this huge explosion, well the last few years, this huge explosion. But now we’ve kind of got this Wall Street adoption. We’ve got potential of an ETF, we’ve got futures. In the grand scheme of things, how do you feel about this? Do you feel it’s a net good for Bitcoin or net bad?

John Carvalho: Overall, I don’t think we have a choice. What’s going to happen is going to happen. So it’s pointless to kid the side whether it’s good or bad. But I think some of it is good and some of it is scary. I don’t know if it’s bad, because it has to actually become bad to say so. I think the notion of a lot of money being tied up in Bitcoin value through an ETF, or a major bank, or things like this, is very scary to me because it’s just centralised control. And it just means they’re all going to get wrecked at some point, in some way.

This always happens in Bitcoin, there’s always every few years a huge central holder that really wrecks everybody. We’re kind of overdue right now, it’s been a while. Mostly it’s been going … the big losses have been coming through Ethereum mostly. They have regular losses of $10–100 million in Ethereum for various bugs. But it happens in Bitcoin too, and it happens when there’s central custody.

And so things like Backed, things like ETFs and BitGo, BitCo really scares me. Things like that scare me because I know that people don’t really fully understand Bitcoin. And they’ll feel like they’re participating in Bitcoin when they’re letting other people hold their keys.

Peter McCormack: Yeah, it’s quite interesting. I’m doing another interview after this with Neil Woodfine and Matt Odell where we’re going to look at Bitcoin in 2019. And I noticed Neil put out this morning Bitcoin’s excited about January 3rd Proof of Keys event. Also, Bitcoin is excited about Bitcoin ETFs, where all keys are held by the centralised custodial third party, thus introducing massive system risk into the market.

John Carvalho: It’s a good contrast, and I actually think neither of them is important. If we could validate and ensure that everybody was withdrawing their coins from all the exchanges, that would be an interesting thing. But I just told you, I don’t think people think of Bitcoin this way. I think there are going to be tons of people that just leave their coin on there. And any of the people that really feel deeply about this philosophy of holding your own keys probably already have the Bitcoin withdrawn anyway.

So, as far as testing this is a bank run, testing their reserves, or just making a statement, I don’t think it’s going to work. It’s fun, it’s nice, and it’s a good sentiment, but I don’t think we’ll see any real effect.

Peter McCormack: The only thing that was of interest that I noticed this morning is that Hip BTC have been freezing accounts the day before today.

John Carvalho: I think that was a spin on the news outlet that released that. I don’t know that they’re correlated. As far as I know, Hip BTC is, as far as I know, I don’t want to slander, as far as I know, they’ve always been a shady exchange, something to not really feel comfortable using your coins on anyway.

Any of these altcoin exchanges that let you make accounts with KYC, or any of them that really list the bottom of the barrel shitcoins, there’s really, really high risk there because eventually they get hacked or something and they don’t tell people. And they become fractional. And they do little tricks like surprise KYCing to see who’s too scared to actually KYC. And they do all these little tricks to take your money away, and eventually, they get closed down or they die.

And so I wouldn’t mess with those kinds of exchanges, very high risk.

Peter McCormack: Right. So before we start getting into some of the attacks on Bitcoin, I’ve just got a couple of other questions for you, just to help tee it up. I heard an interview with you in the past where you said you’re not against all altcoins, and that you liked the idea of another strong chain. Where’s your position on this at the moment? Are there any other projects you like?

John Carvalho: This is mostly deriving from me always thinking in a contrarian way. This is just my way of finding the path to what action makes sense. And so I’m always sceptical, and I always like to look at the current reality. The current reality is there is a high demand for altcoins. They are serving a purpose to people. Whether that purpose is redundant and imaginary, or purely greed, speculation, or scamming, I don’t know for sure. But the fact is, they exist, and we should try to understand why. And if we understand why, we can make a better argument as to why they may not in future.

Like I told you earlier, I still think Bitcoin is the primary, but these things do exist. And there may be utility in just the simple idea of transferring value on a blockchain, you only have to trust it while you use it. So, even if they are low trust … as long as they’re not being attacked the moment you use them, they do serve a purpose. You can use them to transfer value. Not high value, they may have less liquidity and there’s still more risk, and these kinds of things. But if you have some kind of reason, some kind of need to move value over crypto as cheaply and as fast as possible, maybe altcoins sometimes are better.

You just have to make sure you can realise the liquidity you need for the moment you need it. I’m sceptical now that we have SegWit, and lightning, and over ways to send Bitcoin quickly, but I think eventually these cases go away. I also like to think of Bitcoin in a sort of like a biological way, which I’m really happy to see a lot of people talking about lately. Talking about Bitcoin being a fungus or a living organism. This is a concept I wanted to write about, but I was too lazy. So I’m glad somebody is writing about it.

Peter McCormack: Did you see the stuff Dan Herald wrote about it?

John Carvalho: I haven’t read it all, but I want to. I’ve definitely been keeping tabs and seeing there at least two or three people writing about this now. And it’s a concept that I think is very interesting. Not just because it sparks your creativity, but because maybe it will help us in design theory in future. If we think of Bitcoin as an organism that’s spread around the whole world, do we really only want one organism? If centralisation matters, is only one coin good enough?

Sure, I mean there’s an efficiency to everybody cooperating there and that’s what Bitcoin maximalism is primarily about, but I don’t know. I mean what if there’s some kind of utility to have multiple? I don’t think we need 1,000 shit coins, but I don’t know everything, you know?

Peter McCormack: It’s quite interesting. So, having made and lost a lot of money with Bitcoin and shitcoin, which is, by the way, a wonderful experience, my view now, the position I’ve decided to take is would I use it? And would anyone use it? And I know you’re not a fan of stablecoins, and we can talk about that in the future, but I did an interview with Zak Prince and he said that there’s a huge demand for borrowing dollars around the world in certain markets, say Argentina, there is no point. People are putting all their money into Bitcoin. But there is kind of really a fintech use case, but someone can borrow dollars from BlockFi, that can then get transferred to their local exchange, which they can then transfer into their local currency.

I was like, right, I don’t love stablecoins, but I understand the use case. And then I saw something yesterday about drop gangs. Have you seen about drop gangs?

John Carvalho: No.

Peter McCormack: So, this is the progression from dark markets, whereby they’re using private communication networks, because there’s a risk of trading on dark markets because they can get closed down or exit scams. What they do is they create these private chat groups which people will be part of. Someone chooses to make a purchase, and then they will give them coordinates and a location of where the drugs are being left.

John Carvalho: You ever hear a project called drop zone?

Peter McCormack: No.

John Carvalho: This was a project by Christa Rose and some guys I think, where they wanted to do something similar, complimentary to Counterparty. They were using basically a blockchain as a way to establish drop zones for people to make P2P trades. I don’t know that they ever finished it, but that’s just what it reminds me of.

Yeah, I think black market stuff, anon stuff, I have some kind of weird theories about that too where I wonder if fungible coins are and need to be fungible themselves as networks? In other words, I used to talk for a while about how Bitcoin fungibility, how people confuse the concept of fungibility with privacy or anonymity. And they may be complementary or appear together, but they’re not the same thing. My theory is that it might be possible that it’s better to have Bitcoin be relatively in-fungible, and have things like layer twos, or even separate coins that are completely anonymous. Because we need to see how much they will be attacked because of their anonymity.

And it might be better to have something small like Monero performing this and kind of being under the radar. And then it may get too big one day, and so it gets attacked, and then there’ll be another privacy coin that people use. Because you don’t need to save your money, you don’t need to use privacy coins as gold. You only need to use it for transfer. And another weird theory I have is I think that this kind of shows in the mineral price as well. If you look at the charts, it’s not the same correlation as other altcoins. You can almost see when people are seeking liquidity there, and taking liquidity, just to move money around.

Peter McCormack: You don’t see that some people might want to hold value in that private chain because of …?

John Carvalho: Well, the reason is to speculate. Do you know what I mean? Look, Bitcoin, if you want to save money long term, there is no better way to do it than to hold Bitcoin. You’re never going to out-trade Bitcoin. Most people, 95, 99% of people are not going to out-trade Bitcoin appreciation. They’re not going to find a better storing value in the long term. If there’s something you want to save for and you have four years plus to save for it, all of that money should be in Bitcoin in my opinion. That’s your gold.

But you can make a lot of money holding Ethereum in the right six-month span. You can make a lot of money holding Monero for the right pump. But as far as using it as a store of value, why would you gamble?

Peter McCormack: Well, equally you can lose money by getting it at the wrong six months. And it’s quite interesting because we started late because I told you why I was sinking the Monero blockchain because I decided to get rid of all my shitcoins in the end. I just got fed up with it all, I don’t want to trade, I’m not very good at it. So I just got rid of everything, I thought I’m just going to hold Bitcoin in Monero.

John Carvalho: But you at least feel better now?

Peter McCormack: Do you know what, I feel a couple of things. Firstly a huge amount of regret. I’m not hiding anything, because I tell people this. I lost pretty much the majority of my Bitcoin. And at one point I trade up to like 150, so this is nothing that’s not been put out there. Actually, I lost most of it mining, and I don’t feel a huge amount of regret. I’m not bothered in the long run, it’s slightly annoying, but I feel like having a go at mining I’ve learnt a lot and I’ve contributed to the security. And if my loss there is collateral damage for the growth of Bitcoin, I can take that on.

What I’ve come to appreciate now though is that time preference. It’s like I’ve got my Bitcoin, if I don’t sell any of it, I’ve still got my Bitcoin. But what I can do now is focus on the things that I know that I’m good at, which is marketing and consulting, and then I can use that to accumulate more Bitcoin. And you know what, I might never get back to that 150, but I was always worried, like shit, should I trade these out because I’m losing Bitcoin? I don’t have to worry any more. I’ve just got Bitcoin.

But at Monero now, now you’re making me think man, maybe I should get rid of my Monero.

John Carvalho: Well, you see, that’s the thing. I’ve been around for a while and I’ve known a lot of traders. And I still know a lot of them. And the way I always saw that was if I were ever having to focus on the price of Bitcoin, God forbid some shitcoins too, it’s so demanding of your attention that you can’t even function as a human being other than being a speculator and trader.

And I really feel like even though trading is by far the biggest use of Bitcoin volume right now, and crypto volume in general, by far, by far, we can talk about this a little in relation to exchanges in actual crypto businesses. Even though that’s the case, I think that these people eventually all come to a point where they have to make a decision. They have to decide do I want to be a professional trader as a career, and do I like this, and can I handle it? Or am I just gambling and pretending, playing a game until I lose all my money?

It’s as black and white as that to me. So, I think you have to really be deciding okay, I’m going to pay for my education, to learn how to trade. I’m going to lose some money, and hopefully, I’ll make a lot of money and hope I can do that consistently and have a good discipline for it. Or, I’m going to gamble and pretend I’m a trader and only tell people when I win. And go home and cry when I lose and feel like a dirtbag for as many years as it takes me to give up.

Peter McCormack: And do you know what? That’s why I’m so glad I’m out of it, because not checking the price all the time is great. Not worrying about the price. Also, it’s quite a lonely experience trading. You’re just trading and talking to people on Twitter, you’re not actually building anything. Like with my podcast, at least I feel like I’m building something and I’m contributing. And when I look at the end of the month and in December there were 108,000 downloads. And that’s like wow, I really feel I’ve contributed something, given something back. And the fact that I can make a living off this is great.

When you’re trading, I kind of realised that it is really a zero-sum game outside of Bitcoin if these things to go to shit. And therefore you’ve got to get yourself comfortable with the fact that you’re going to make money off other people losing money and feeling crap. And I’m not comfortable with that personally, anymore.

John Carvalho: Yeah, I think that’s part of it. I don’t think too much that way. I do think it’s healthy to understand that, that there are two sides to every trade. But no, I don’t think trading is for everybody, despite it being what most people do.

Peter McCormack: All right man, well listen, look, let’s start talking about the attacks on Bitcoin. And before we do, it’s like you obviously, you talked about the army, you feel some need to defend Bitcoin. Where does that come from?

John Carvalho: I honestly am not sure. What would be the most obvious answer is I could say to you I want to protect the value of the money that I hold. But man, there have been times when I’ve had no Bitcoin, and I’ve done it the same exact way. I think maybe it’s also protecting all of the efforts I’ve put in already in understanding and translating this to people. Because I’m not the most technical person, but I try really hard to at least understand the concepts in a way that I can explain them to other people.

And someone told me in the past that demonstrating understanding is translating. If you can translate something to someone else, then you understand it. So I do take value in that.

Peter McCormack: That’s quite interesting. I actually did think recently of why don’t I just sell all the rest of my Bitcoin, be completely impartial.

John Carvalho: That’s bullshit. I’ll tell you the opposite story. When I was around the time that I did the Roger Ver interview, I had a friend say to me, he said, “Man if you’re going to be making videos like this, the way to make money is you need to be holding as much fucking Bitcoin as possible.” And I didn’t really understand him immediately, I’m like, “What do you mean? Nobody’s paying me for this, I’m not going to get anything out of this.” And he’s like, “No, when you do this stuff, you have to help Bitcoin. When you go out there and you fight for Bitcoin, you make content for Bitcoin, the way that you get paid is by holding Bitcoin. That’s how you get paid to be who you are. And if you don’t do that, you’re just going to screw yourself.”

He was so right because at the time Bitcoin was worth like 6,000, it hadn’t hit 20 yet. And so it was just, I don’t know, it was a weird serendipitous moment. And I just … it really gave me another reason to say why I do this. It’s to say that the way you make money in Bitcoin is by having Bitcoin and defending it, or improving the infrastructure, or providing services and products related to Bitcoin. This is how you make money in Bitcoin. And you just have to stick around long enough to catch the next halvening, or major wave of adoption. And then you’re taken care of.

Peter McCormack: That’s a great point. And we’ll also come to Roger because we both interviewed him. Okay so, there are various attacks on Bitcoin that I’ve noticed. But I think probably the most obvious one and the scariest one on reflection for me, and you might disagree, but S2X seems to me to be the biggest attack on Bitcoin. And it took me probably a good … it wasn’t probably until about a year after it, maybe even longer, that I fully understood the threat posed. You hear all these people who are anti-Core, who have a pop at Core and Block Stream, and they’ve held Bitcoin back, blah, blah, blah. And I actually did an interview with Brian Bishop recently, and he said a really interesting statement. He said no Core developer wakes up and thinks what can I do today to improve the price of Bitcoin?

And I’ve come to really appreciate the slowness and the careful way that Bitcoin has been developed, and appreciate things like what Luke Dash Junior said about protecting income. And it seems to me that actually the scaling and the potential fall with S2X was probably one of the biggest attacks on Bitcoin.

John Carvalho: It was definitely one of the biggest. I don’t know if I would say it’s the biggest, because we have to talk about Roger Ver. And in the context of what Brian Bishop said to you, I agree, that’s true. I don’t go on Twitter thinking how can I make the Bitcoin price go up? I don’t do this interview with you for that reason, even though it kind of sounds like I did from the last statements I made. That’s not … I’m not thinking that at all. But, it’s exactly what Roger Ver is thinking when he wakes up in the morning, is how can I make Bitcoin Cash be worth more?

He’s not thinking about improving it and making sure it scales and lasts forever. This kind of stuff. He’s thinking how can I reap the most from these people? That’s my opinion. And so I think the biggest attack on Bitcoin is Roger Ver and Bitcoin Cash. I don’t know how related that is to S2X or Bit Mane, or how tied up those things are, or if they’re all just one thing anyway. But that would be my choice for the biggest attack. Actually, because he has funding, and he owns Bitcoin.com. And he’s willing to be a two-faced person and manipulate people and call Bitcoin Cash the real Bitcoin.

This is a much more subversive and difficult attack. I think it’s failing now, I think at this point it’s becoming more and more irrelevant. But last year it was scary, for the past year. SegWit2x, yeah, that was a big attack. I remember when it came, I remember immediately giving Barry Silbert shit on Twitter. He took a little Twitter break after. Just engaging with everybody I could. There’s a series you can find of me where I did 50 different tweets to every single person that signed it, asking them why they signed it.

Peter McCormack: I’ve got to read that, that’s really interesting because I heard in a different interview, I can’t remember who, about Barry taking a break. I didn’t realise there was something that happened …

John Carvalho: I don’t know for sure if it was just me, or what, but I remember I came at him immediately about it. And we got into an argument, and he used a similar argument that Roger Ver used in our interview, he said something like … he John’d me. He said, “John, you do know that I have funded the most Bitcoin companies and the most crypto, and I run …” he tried to credential me. And I said, “It doesn’t matter, it has nothing to do with this.” Yeah, if you want me to help you find it, let me know.

Peter McCormack: That’s quite interesting as well because if you go into the mailing list discussions, one of Roger’s very early points was that the companies on the mailing list served millions of Bitcoin users. And I’m thinking yeah, you do, but you don’t speak for those people.

John Carvalho: Mm-hmm (affirmative), yeah. They wanted to decide these things for the users. They’d never asked the users, they never called them. I’m sure they didn’t because the users probably didn’t even give a shit. They don’t know what’s what. And it’s the core people of Bitcoin that are the ones that are actually analysing the stuff and even more so with developers et cetera. People like Jimmy Song, and Jameson Lopp, and all these people that actually dig into it. But the users at Coinbase, come on, Coinbase says it has what? Like 20, 30 million people. Who the hell are these people? They probably don’t know that much about Bitcoin, they probably just heard about it and they wanted some. That was about the extent of it.

Peter McCormack: Well, its kind of comes down to that thing sometimes where someone will argue about democracy and they’ll say, “Yeah,” but for example with Brexit in the UK, a lot of people have said, “Well most of the people voting for Brexit don’t really understand this, and they don’t know what they’re voting for.” And you could kind of probably make the same argument for this if it came down to users.

John Carvalho: Yes. I don’t understand it. I don’t know the details of it. It’s probably true.

Peter McCormack: So, what do you first remember when it all first started to happen? Because my first memory of it, and the first thing that kind of was a red flag to me, with my very limited understanding of the background of Bitcoin, was a secret meeting. I just heard about this secret meeting behind closed doors, and I thought that just doesn’t sound right.

John Carvalho: Back then there was a little bit of a small trend of secret meetings. Back then they had the Satoshi Roundtable that Bruce Fenton tries to put on every year. And if you’re a Bitcoin VIP, you can get invited to go to this thing and spend $3,000, $4,000 and go to a resort for a few days and hang out with people.

I went once, and it was mostly role-playing as if we were all important, you know? But there was … when I went, there were some secret meetings. There were people from major companies. And you could see for example I’m not supposed to talk about this stuff. I can’t say, specific people. You could see certain people from certain big companies getting really upset about things, and they were probably arguing about scaling stuff.

And I think at some point companies like Coinbase and Digital Currency Group, they basically decided that the Core developers were just too stubborn, and they were never going to listen to reason. And so they felt like they had to do something. But they never really stopped to check themselves and say why they felt this need, and why they felt they had this power. And it was always just for commerce, it was never for Bitcoin. It was always self-enrichment, the success of their own companies.

And conceptually, you have to understand that when you do Bitcoin in business, you have two choices. You make Bitcoin your best friend, or you make it your biggest enemy. And Coinbase decided to make Bitcoin its worst problem, you know? It decided not to align with Bitcoin, and Barry Silbert and the New York agreement was part of an extension of this kind of feeling.

I do think Barry likes Bitcoin, I’ve never had a personal conversation with him, but I think he sees reason in balancing business and balancing how much he actually cares, you know?

Peter McCormack: Yeah. I heard an interview with him with Laura Shin where he talked about … he just wanted to break the deadlock, and he felt like he was somebody who could broker that. And it was said, I didn’t 100% believe him, but I didn’t 100% disbelieve him. I kind of didn’t know or want to think.

John Carvalho: Well, the deadlock was imaginary. The deadlock as his narrative that allowed him to behave in this way to correct his perceived problem or their perceived problem that Core was stubborn and would not do what needed to be done. But Core has always been doing what needed to be done as far as I can tell. And Core is not even a thing, Core is just what you name the people that work on Bitcoin. They don’t have as much cohesiveness as people think they have.

There’s plenty of disagreement, there’s plenty of centralised aspects. It’s not just people working on that code. And to point at them as if they’re an organisation that won’t cooperate and fix this problem, it was all imaginary in the first place. Luke Junior, he argues that the block should be smaller. It’s not a crazy argument, there is a reason for it. And so for me, the obvious thing was just that they wanted to fork it, and there was no consensus. That should have been the end of it.

As soon as they realised that there was any notable amount of people that would fight this, they should’ve known it before they even started that that would be this way. It was pointless because you saw my comments in the threads and things like this, and my comments with Vinny Lingham and the video I did with him on Twitter, et cetera. It was always destined to fail, and it failed fucking gloriously.

Peter McCormack: What was quite interesting going through that experience as somebody who isn’t hugely technical, who was trying to figure out maybe big blocks are a good thing. Because you’re coming in new, you don’t understand the full background. You’ve heard about this guy, Roger Ver, who’s done so much for Bitcoin, he’s put so much money in. You’re like ah, he must be some kind of cool guy. You don’t know all the less than honest things he’s done.

And then you’ll hear an explanation, well, it’s meant to be money and the blocks are formed. We can’t get enough transactions. Okay, that kind of makes sense. Oh yeah, these small blocks, they don’t make sense. And you can easily be swayed for a period of time, and it’s very easy to be influenced, which is why at the time … look, I got a lot of shit for interviewing Roger because I interviewed him in a very different way from you. But I was genuinely at the point where I didn’t fully understand why small blocks are more important than big blocks.

And like you say now, I’ve seen the Luke Dash argument for 300K block size. I’m like yeah, that sounds like a good argument as well. But understanding the cost of no’s, why no’s are important to decentralisation. How block size is important. I tell you actually what the real turning point for me is when Tom Woods hosted a debate between Jameson Lopp and Roger. And there was a time when Jameson wanted bigger blocks. Hearing that debate was a real game changer for me, for understanding block size and why it needs to be small.

John Carvalho: Yeah, I remember actually the first time I met Jameson Lopp was at one of these conferences. And at the time he was just … we had kind of had a little bit of Twitter fights. He probably wouldn’t remember. But I did see him as one of the evil Bitcoiners. He works for BitGo, I don’t like BitGo at all, I think they’re a scary company. I don’t like the concept of what they’re doing. Apparently, people see a need for it, but Jameson kind of turned around once he left BitGo. He became a real authority and influencer from a technical side of Bitcoin, and everybody seems to really get a lot from him. So I’m glad that that happened.

Peter McCormack: And then eventually the whole thing collapsed anyway. And again, I will say the final point that made me realise that it was fully bad was when I was reading about replay protection. Again, I don’t understand the technical side of things, but I was just like well why would you have confusion, why would you add this confusion when you don’t need to? And again I’m going to quote you, and you put in there, “The funny part is the lack of replay protection will hurt your fork more than help it. We tried to help you, you doubled down. We tried to educate you, you doubled down. Your goal must be disruption.”

And that became kind of clear, even for a non-technical person.

John Carvalho: Mm-hmm (affirmative). Yeah. I have some good people that I talk to about Bitcoin concepts and stuff like this in private, and I have some of these debates in private before I have them in public. So then that really, really helps me be able to try to explain things more eloquently.

Peter McCormack: All right, man. Well, S2X fell apart, amazingly, gloriously.

John Carvalho: Yeah, I mean it couldn’t have gone any better. It was like a golden time for Bitcoin and for me, doing the Vinny interview and then having SegWit2x fail exactly how I told him in every different way that I could. And then having the Roger Ver interview and people wanted … they wanted someone to hold them really accountable in an interview at least once, and I felt like I did my best to give that to them. And we gave them that little happy ending too.

Peter McCormack: I tell you what was quite interesting, and it’s on Reddit so people can almost time stamp prove it, I was in Vegas when it collapsed. And the night before it was cancelled, I sold all my Bitcoin. I just went on Coinbase and sold the lot. I just thought I’m not part of this, I don’t understand it. I just want to hoard money. And then what happened was the price crashed the day after. I was like oh, I need to buy back, I need to buy back in. I didn’t know where it was going to bottom out. And I ended up buying back in just below the price I dropped out, so it was almost like an even trade. But it was a really strange time.

Well, let’s move on to Roger because we’ve both interviewed him with very different experiences. I went because I wanted to learn, and also I’d interviewed Lynne Ulbricht, Ross’s mom, and we’d had a long conversation about how Ross was supporting the family. And I was like well, this guy’s not all bad. And very interestingly I’ve told people my 45 minutes with Roger after the interview, no mics, no cameras, was a very different experience. And he was a very different person from I’ve seen in all the interviews. I’m not justifying anything he’s done.

So, you feel like Bitcoin Cash was a bigger attack?

John Carvalho: I feel like the efforts of the people that support Bitcoin Cash. The actual creation of it, initially I didn’t really think it was a big deal. I think the inception of Bitcoin Cash was basically Bit Mane I think it was warned the public that if SegWit2x failed, that they would still make a coin anyway. And if X and Y happened, I forget their stipulations. And then those stipulations weren’t quite met, and they did it anyway, or they did it early, and we had Bitcoin Cash.

And then all of a sudden Craig Wright, and Roger Ver, and Johann. And then all these exchanges support it, and everybody’s yelling at the exchanges that won’t support it because they want their free money. And I’m just like, “Oh God, what the hell is happening here? Why is this a thing? Why is everybody taking this seriously.”

I remember having private conversations with people I’ve known in Bitcoin for years, where the narrative just started eating into their brains. They started believing that maybe this is the real thing, and this is something that needs to happen. And they just started buying it. And I had to get into so many arguments with people that are close to me, trying to remind them, like, “Come back to Earth. Please come back, guys. This is not a dream.”

It’s been hard. It really frustrates me what Roger does.

Peter McCormack: Bitcoin Cash is heading towards zero. Like most things, as you say, it probably won’t die, because there’s always some scenario, but it’s heading towards major irrelevance. It’s just not being used. Roger’s also experienced his own contentious fork with Bitcoin SV. Again …

John Carvalho: That was the biggest mistake for sure. This fork they just had I think might have been the death knell for them. It sucked away all interest, it sucked away the last amount of speculators that were willing to throw extra money at it. I think it was just a liquidity event, they just wanted to do a little marketing hype to generate some liquidity, to get people to get their drop. And the whole thing just feels stale to me now.

Peter McCormack: Yeah, I was almost losing interest in it. And when it actually happened, I was asked about it, and I was like I don’t really know much about it because I’ve just lost interest in it. But as it heads towards irrelevance, and there will come a time when the likes of Ray and Roger will have to give up on it, people have asked about and said about Roger coming back to Bitcoin and will he be welcomed back?

And I kind of had this view that nobody has a choice. And that’s actually the great thing about Bitcoin. If he chooses to come back to the original Bitcoin, nobody can do anything about that. But how do you feel about that?

John Carvalho: I think I have a tweet saying pretty much the same thing. I’ve told Roger in a tweet maybe not even a month ago that he’s welcome back anytime. And somebody said, “Why would you say that?” And I said, “Well, I don’t have a choice. I would rather have him use his wily ways on something that I actually care about.” But I would still correct him in the same ways. If he were in Bitcoin and he was trying … this is the thing about Roger, right? He has been saying the same stuff about Bitcoin for years. Before Bitcoin Cash, he used very similar arguments. But his original arguments came out of natural ignorance, they were forgivable.

He wanted to promote Bitcoin as being fast and cheap. And the same things he talks about Bitcoin Cash, but he didn’t really appreciate or maybe didn’t even understand how Bitcoin works and the fundamentals of how it is not a cheap thing, it is not an efficient thing. That it’s expensive, and it’s redundant. And that the qualities he’s selling to people as to why they should come, saying it’s anonymous and all these things. They were all wrong at the core. And at the very best, they had a lot of subtleties to explaining how they achieve any amount of efficiency or achieve any speed.

And so if he came back and started doing that again to Bitcoin, nobody would treat him any better, you know? He would still get everybody correcting him all the time, because he’s always thinking in ways, and explaining things in ways that are like he’s trying to sell something. He’s not actually trying to help people. He makes it seem like he’s trying to help people, to get their money.

Peter McCormack: Would you say in hindsight the Bitcoin Cash experience has been a net good for Bitcoin as well, even though it was an attack, in that … it’s like a couple of things. I think it’s kind of proven that Bitcoin isn’t entirely about code. It’s not about having the most efficient or the best code, it’s about history and trust. But also, it was a useful experiment in bigger blocks, to see if they are work.

John Carvalho: How useful? How is it useful? It doesn’t prove anybody right, it doesn’t prove anybody wrong. It’s there as an example I guess, and people say this about a lot of altcoins and things. And there are some examples where altcoins have affected Bitcoin. But in general, this is a tough argument. I do believe in the concept of anti-fragility, which I think is what you’re getting at. And I do believe that whatever hurts Bitcoin also helps it.

But, it’s a really hard thing to balance, because you don’t get to see what would’ve happened otherwise. You don’t get to see what would’ve happened if only 10% of the money that people put into crypto went into shitcoins, instead of 50%. You don’t get to see what would’ve happened if all the developers that worked on Ethereum had worked on Bitcoin instead. We’ll never get to know that, and I don’t know which one works better, you know?

Yeah, the attacks are nice, they’re nice to see that we can survive them. It’s nice to see how we react and develop new techs to respond to them, how we respond as a community, what we do to fight for Bitcoin. But I actually believe that the real way to maximise efficiency in Bitcoin and get the most out of it is cooperation. It’s like a Ponzi scheme, okay? It’s a Ponzi for the people. It’s a Ponzi with no head, and if everybody gets on board, everybody will maximise their gains. Do you know what I mean?

And I don’t just mean that in purchasing power, I mean that in utility, infrastructure, community, everything. If we just move to one coin, then everybody is going to be a lot happier. But, there’s still going to be the volatility to get there, the pains, et cetera. I don’t know, we’ll never know whether it’s good or bad for Bitcoin.

Peter McCormack: That anti-fragility thing is really interesting. I always like to think of it as like an immune system, and the immune system gets stronger. Okay, so Ethereum, is Ethereum an attack on Bitcoin itself? I certainly think in some ways it is, because it’s created, and almost it feels by design by Vitalik an anti-Bitcoin army. How do you feel about that?

John Carvalho: I don’t know. Sort of. I would say Ethereum people don’t seem to be that interested in attacking Bitcoin too much, but anything that is cryptocurrency or blockchain always has to, they have no choice, they have to paint themselves in the light of Bitcoin. They have to refer to themselves and say this makes them like stablecoins. They wouldn’t be called stablecoins if it wasn’t referring to Bitcoin’s volatility. It would be called Dollar coins, or Gemini coins. Do you know what I mean? They wouldn’t really call it stablecoins.

Peter McCormack: Yeah, I’ve never thought about that.

John Carvalho: Shitcoins are called shitcoins because they’re shit compared to Bitcoin. They’re called alt because they’re an alternative to Bitcoin. Everything is talking about itself in the context of Bitcoin.

Peter McCormack: I don’t even want to talk about ripple coin. Although the only thing about that is they’ve created this weird cult community of people who really don’t understand much, but how to regurgitate nonsense messages and attack Bitcoin with already proven fud.

John Carvalho: Right. Over the years they come up with formulas, and it’s actually a whole cyclical process that comes along with each wave of adoption. In the early days, they had the first Bitcoin Ponzi schemes, and those had to paint themselves against Bitcoin by saying you would earn more Bitcoin every day. And then they had Bitcoin securities and Bitcoin derivatives. And this was all being centralised. They weren’t on ICO tokens yet.

All this already happened years ago, in 2013, 2014. We already had an ICO craze, that happened before, I saw it already. That’s why I knew how this one would turn out. And it will happen again. I don’t know for sure what the flavour will be, but it’s just an iteration. Every cycle, all the scammers iterate on what the scammers did before. And they do this to exploit the ignorance of new money.

And so adoption brings gravity to Bitcoin, brings money and value to Bitcoin. And everybody’s fighting to take it away from Bitcoin. Everybody’s trying to take your Bitcoins and take your money and keep you away from Bitcoin.

Peter McCormack: And is there like a new layer of defence now with Lightning Network? Because there seems to be … if you can’t attack Bitcoin, attack Lighting, or attack the two.

John Carvalho: I mean the attacks on Lightning are pretty laughable mostly. I do think that there are good arguments saying about how there’s a complexity to it, and how getting adoption, getting it actually integrated into society through commerce, and business, and users, is going to be a lot more work. But the tech is sound, the tech works. Calling it centralised, saying you can’t trust it, that you’ll lose money or whatever, all these things, they’re nonsense. They’re just stupid narratives that people like Roger Ver say, et cetera.

It works, I’ve seen it work. I’ve been there. I’ve run a node. The company I work for is supporting it. We have new technology that’s … new features allowing people to use it in different ways that we’re going to be announcing. It’s just going to take longer than people want it to, and this just gives altcoins something to say. It gives them an argument. And their whole job is to market against Bitcoin, to say why Bitcoin is bad and they’re better, so they can take your money.

Peter McCormack: All right, well I think you’ve articulated well, plenty of defence of Bitcoin. Before we look forward, is there any other attacks on Bitcoin I’ve not talked about that you think are relevant that people should be aware of?

John Carvalho: I think that trading is one. We talked about it a little bit, but I think that the illusion that you can make money trading and the illusion that’s provided by knowing someone who got rich on some shitcoin that 100 X’d, I actually think that trading is a really, really horrible thing for people.

Professional traders are not what I’m talking about. People that know how to trade, or have a serious interest in becoming a professional trader, it’s a fine expertise. It’s work you can do from anywhere. But most people can’t come close to having the discipline, to having the understanding and the risk management and doing this properly. They’re just gambling and they don’t know it. And it’s a brutal process to watch people lose money.

I have so many stories of people this year telling me about how they got wrecked doing this or that, on the way up and on the way done. And I think that at this point, it’s just … the exchanges are just trying to milk everything they can for everybody. And it looks okay because it’s just taking fees. But they have such sophisticated traders, machine learning algorithms that will detect every amount of retail volume that gets put anywhere. They measure the amount of who’s short, versus who’s long across all kinds of exchanges. They have way more information than you, and you’re just there to give them your money.

And you’ll win once in a while, but eventually, the house is just going to take everything from you. I think that is a huge attack. I would hate to see everybody lose all their Bitcoin and it all being held by JP Morgan and shit like this. And then having a major influence over Bitcoin, because they now hold all the trader’s money.

Peter McCormack: Quite interestingly, one of the New Year’s resolutions I created was to create more education, because I think education is like … in terms of football, we talk about an attack is the best form of defence. But I think in terms of Bitcoin, education is a very good form of defence. But one of the areas I get lost on is for example if I was to use my website, I was thinking of doing a separate 10 podcast series, like for somebody who’s got no experience of Bitcoin to take them through 10 half hour lessons from what it is, security, why it’s important, et cetera.

And I was thinking within there, how do you handle all kinds of projects? Do you criticise them and just promote maximalism? Or do you educate and allow a free market? And I was really confused about what the right thing to do would be.

John Carvalho: For me, it’s kind of in line with what I was just saying, I think. I definitely understand this because I’m always trying to educate new people coming in. And it’s hard to tell what works, and it really depends on why they’re here. The past wave really brought a lot of people that wanted to speculate on all kinds, so it became much more talking about how you have to associate this with gambling and be honest with yourself about what you’re trying to do. And you have to understand that you’re not just going to get rich quick. That this is all luck, that it’s not skill for the most part.

But yeah, it’s hard to figure out. I haven’t figured it out, I’ve been doing it for six years trying to learn and educate other people and get them quickly to appreciating what Bitcoin is, and why it’s worth what it is. And it’s always hard.

Peter McCormack: Yeah. All right man, well listen, we’ve done a good hour already. Let’s look forward. So, tomorrow is the 10 year anniversary of the protocol, which is pretty amazing, it’s survived a lot. What would you like to see over the next 10 years, and where do you think we may be in 10 year’s time? Which is a huge question, I appreciate.

John Carvalho: I want things … honestly, I would just like to see things keep going the way they’re going. I would like to see us continually have a cycle where we achieve the all-time high again every four years, with the happening. I like to think of Bitcoin is always worth its all-time high price. It’s just a matter of if you want to wait until it gets there again. And I would like to see that continue.

I know that sounds like speculator greed in me, but I think you have to have the market cap to be able to continue to support and attract adoption and more and more people using it. They all go hand in hand. Liquidity, et cetera.

I would like to see layer two technology flesh out and actually succeed in being how most people use Bitcoin, and see Bitcoin get to be more of a way of storing … the main net, the main chain being more of a way of storing your Bitcoin instead of using it.

What else would I like to see? I would like to see a kind of culling of the altcoin confidence. If they keep pumping harder than Bitcoin every time Bitcoin pumps, it’s going to make my job really hard. And I just want there to be this one day where we all wake up and Bitcoin went up $50,000 for some reason, and all the altcoins didn’t move. That’s what I want.

So I can say, “Look, I told you guys. You should’ve just bet on Bitcoin, you should’ve appreciated that it is the core thing. Because now you’re all left behind and you’re never going to be able to have a whole Bitcoin again. Do you know?

Peter McCormack: Okay, that’s pretty cool. We’ve done a really good show here. Before we finish, how’s it going at your new job?

John Carvalho: Pretty good. Maybe you read the blog post, but I’ll summarise briefly. I was doing … I still am doing the video streaming site Exotica, which is Bitcoin only. And basically, their market made it really hard to keep … we only hold Bitcoin. And so I just kept spending, and I was just like, “Man, I can’t spend at these prices. I need to be earning at these prices.” And so I went back out and just kind of put feelers out to see if there were any P2P people that would be interested in working with me. And I did it very, very broadly, and immediately Sergei, who had also gotten into Bitcoin around the same time, and he has a similar background to me as well in learning about Bitcoin, his history with it.

He said, “Hey, let’s get on a call.” And we got on a call, and I learned more about the product. I feel like gift cards are something that’s always been a use case for Bitcoiners because it’s like … gift cards do what utility tokens and altcoins are supposed to do. They’re supposed to be like a specialised way of holding money, like having a Starbucks card for your coffee, it’s much more sensible than using Bitcoin Cash for your coffee, right?

So, all these utility tokens and things, they don’t give you any utility at all. People just buy them to speculate. They have no fixed value on any of these platforms, so why would anybody ever buy a utility token if they didn’t know what they were going to get for it 10 days from now? This is the case for things like that. What’s the name of that project with those timestamps? Tyrian, Tyrian and Civic, and these companies … why as a company or a user would I ever buy these tokens and hold them, and not know how much service I would get from them later? It makes no sense.

Utility tokens don’t make sense unless people embrace in being centralised and backed by a specific amount of value, of a product or service. If they can’t do that, they’re useless.

Well, I guess another use is some people are trying to use them as securities to pay dividends, which is brave. But yeah, that’s how I see that.

Peter McCormack: Cool. And before we finish up, how do people stay in touch with you? Who do you want to hear from? Who do you not want to hear from?

John Carvalho: Anybody can try to contact me, but you can find me on Twitter, it’s Bitcoin Error Log. I have a blog on Medium, I don’t post to it too much, but I would like to more. With Bit Refill, I think we’re going to be hopefully starting a new content series. It’ll either be me, or Sergei, or both of us. I don’t know if it’ll be a blog or podcast format, but you may have seen me on Twitter talking recently about the Bitcoin business concepts. And we have some concepts that we want to talk about, basically defining what it actually means to be a Bitcoin business. I don’t think there’s been enough conversation about this, enough abstract conversation and how you’re supposed to do it.

Things like I said earlier, with like you have to hold Bitcoin if you’re going to be supporting Bitcoin. And if you don’t, you’re not going to get the most value out of it.

And so I really want to do some kind of content around that.

Peter McCormack: All right, man, well listen, I’m glad we did this. I’m glad we rebuilt that bridge. This has been a real pleasure to do this.

John Carvalho: Yeah, me too.

Peter McCormack: You’re not far from me actually, so I think at some point we’ll actually have a beer in person.

John Carvalho: Oh yes, if you want to come out here and visit, come any time. Depending on when you come will depend on how good of a time we can have.

Peter McCormack: Do you still do the meetups?

John Carvalho: Yeah. I was doing them weekly in the summer, but then as the price crashed and the winter came, it gets pretty cold here. I just started reducing the frequency. I’m doing the next one again this year next week. And the topic is Bitcoin business concepts.

Peter McCormack: Interesting. Well, listen, I might come out for one nearer the spring then, when the weather’s a bit better, and come and hang out. But look, thank you for responding to me when I reached out to you. Thank you for coming on, I’ve really enjoyed this.

John Carvalho: Thanks for having me, I really appreciate it.