Self-custody system and nodes — this is usually where the user starts getting into the tech nitty-gritty of the system and this can doubtless turn a lot of us off. In this conversation, Jameson Lopp and Sunny Ray simplify it for us.
In yet another fascinating conversation, Unocoin co-founder Sunny Ray explored Bitcoin and its workings with founder of Casa, Jameson Lopp. Lopp has been working passionately in the crypto space for a while — he had first become interested as a hobbyist 8 years ago. He then started building open-source projects to understand Bitcoin better, and decided to launch himself into the space full time in 2015. “Since then,” he said, “I have focused on a simple problem which continues to persist in this space: how to make it easier for people to manage their private keys, how do we continue to push forward the fulfilment of Bitcoin’s promise of being your own bank.”
Bitcoin and the Tech Jargon:
One of the major barriers to adopting Bitcoin has been the tendency to relegate its design, management and thorough understanding to people who are technical, or people who are willing to spend a lot of resources and time trying to learn how to use it. “If we need to stay decentralised, we need to keep identifying the pain points around key management,” quipped Lopp.
Money and Power:
Perhaps one of the key reasons Lopp got into Bitcoin in the first place was because money “as an abstract concept should not be something that is dictated by a small group of people”. Money as an open-source project fundamentally made sense to him, like many others, and emerged as humanity’s best hope in making a more fairer type of monetary system.
“You don’t want to have a few people controlling it (money) at their own whim and to their own benefit.”
In this context, Bitcoin has been a viable alternative and has largely delivered on the promise of being an open project where anyone “who really cares can contribute”.
Self-custody System:
Moving away from fiat currency, the decentralised, peer-to-peer architecture of Bitcoin firmly places power and autonomy in the hands of the individual user. But there are problems that endure, as they would in any new system which was founded to improve upon an existing one: How do we prevent it from sliding back towards what the current financial system is like?
“In order to keep the power as decentralised as possible, we need to empower the individual. And for the individuals to be empowered, they need to be able to take control of the ultimate security model of Bitcoin — which is commonly referred to as ‘trustlessness’ and ‘permissionlessness’. What I really see is that you are running your own software and using your own hardware to verify the entire state of the system and are in control of your private keys. You are not having to ask anyone for permission to use your money and not having to trust a third party that your money is actually there. You need to have your own self-custody system, preferably be running your own fully validating node.”
Simplifying the System:
Self-custody system and nodes — this is usually where the user starts getting into the technical nitty-gritty of the system and this can doubtless turn a lot of people off. The average user looks for a simple, time-efficient experience which requires the least effort possible. There stands, however, a vital pinch point here, as Lopp explained: “Now we get into the whole issue of the spectrum of convenience v/s security v/s privacy. The freedom of a system like this is that people should be able to choose to trade off security or privacy for convenience.”
But in the very least, he said, we should try to lower the bar as much as possible to get into a high security posture.
“Hopefully the lower the bar, the more people will opt into a better security environment and the result of all these different individuals opting into that is that we make the system stronger and more resilient.”
How is Casa helping people and giving them sovereignty?
Lopp explained how money is essentially a time storage to most people who hold it. “Before, I used to think that money could be used to buy things, but what I find interesting is the ability that money gives you to buy other people’s time.”
It is this vision that Lopp brings to Casa and empowers the individual using the skill he knows best as a Bitcoin engineer — coding.
“What I think of code is a manifestation of a single, small, tiny part of myself. When I write a certain script, a certain function or even architecting a complex piece of code, what I am doing is projecting my will into reality. I have thought of something that I want to happen, and also preferably want for other people to have that happen, I turn it into code, I test it. There will of course be maintenance required but once I have deployed that code, it is running 24/7 with very little overheads required.”
Bitcoin and Transaction Costs:
Lopp shared his views on the transaction costs around using Bitcoin and how they might be counterproductive to bringing convenience to its users:
“It is important that we come to some sort of consensus around how much it should actually cost for people to be able to transact on the blockchain — if it’s too costly to transact on chain, then it will be too costly for people to move their funds off of trusted third parties and into self-custody. This is a very complicated aspect — we are confronted with issues of how much it costs to fully validate the whole system and run a full node. It can’t be zero-cost because then the blockchain data blows up and it becomes too expensive to validate, but on the other hand, if it costs hundreds of dollars to withdraw your money and put it into your own wallet, that’s going to prevent a lot of people from doing it. Second layer solutions can get us there but it’s fundamentally impossible for a second layer solution to ever be as secure as a base layer solution. As it stands right now, I don’t foresee people holding their life’s savings in a second layer solution.”
Get in touch with us and start your journey to self-custody and sovereignty with Unocoin today: https://www.unocoin.com/in