Matt Odell, Bitcoin podcast co-host of the Rabbit Hole Recap joins me in this fun episode to talk about ways Bitcoiners can put theory into practice. Along the way we chat:
- Challenges in educating noobs
- Common pitfalls and scams
- Approaches to take going forward
- How to avoid scams to come in the future
Matt Odell links:
- Twitter: https://twitter.com/matt_odell
- TFTC podcast: http://tftc.io/
Stephan Livera links:
- Show notes and website
- Follow me on twitter @stephanlivera
- Subscribe to the podcast
- Patreon @stephanlivera
Podcast Transcript:
Stephan Livera:
Hi and welcome to the Stephan Livera podcast focused on Bitcoin and Austrian economics. Today my guest is Matt Odell. He is a cohost of the Rabbit Hole Recap podcast series. So make sure you check that out. And his cohost is Marty Bent, who also appeared on my podcast on the earlier episode number 49. Matt’s a guy in the space who provides good updates and analysis. So I wanted to get him on the show. So here’s my discussion with Matt.
Stephan Livera:
Welcome to the show Matt. I’m a big fan of your work with Tales from the Crypt and Rabbit Hole Recap.
Matt Odell:
That makes two of us, happy to be here.
Stephan Livera:
So Matt, what I’ve see. What you’re doing is really putting Bitcoin into practice for a lot of people because when more technical members of, you know, Bitcoin community talk about things, it can be put in a very technical sense. And then sometimes that can be kind of difficult to break that down into how should I, the individual actually go and do that. And so I think some of the material that you share both on Twitter and also just from your commentary that you offer on rabbit hole recap, I think it just helps offer some of those resources for noobs. I think yeah, might be a good to talk through some of those typical setup ways because we face that challenge of trying to get people into Bitcoin but then get them in the right way. I’m sure you sense that same challenge as well.
Matt Odell:
It almost feels like we have two completely like a probably different situations where you have, you either have one side of the spectrum where people are getting information that is just completely incorrect that is just not based in reality whatsoever and is pushed because of ulterior motives. And then you have the other side of the spectrum where everything is based on actual hard observations and facts, but it’s just super technical and just way too dense for anyone to actually reasonably get through, especially if you’re a beginner. So I try and I’ve been trying for a couple of years now to bridge that gap in between where you take some of these technical things and you distill them down to like what’s really important, what are the key things that people should out of about take out of these different scenarios and these different strategies.
Stephan Livera:
Yeah, exactly. And I think that the challenge for most is people are just time poor. They don’t have the time to go and read the correct way to, you know, to go and let’s say store their Bitcoins correctly, run everything using their own full node, etcetera. In practice it tends to be, unless they’re already very highly technical and very, having a lot of time, you kind of, they have to sort of start in a very basic way, but doing those basic way things tend to erode their privacy.
Matt Odell:
And it’s, you know, it’s also, it’s one of those industries where individuals that are not necessarily the most ethical or you know, the most morally conscious tend to, they can make a lot of money steering you in the wrong direction. And not only that, then you have on the opposite side, you have the people that, that do know this stuff that is the wizards out there. They’re too busy to really interact with beginners or interact in any way that kid can. You know, they just don’t have the time. Everyone is time poor, right. So they don’t have the time or the willingness to break these things down in, into newb friendly newb friendly content in general. You know, one of the things I love about your podcast is I feel like, you strike that balance. You really well. Like you can have a your podcast is great for someone like me who’s, been in the space for what feels like forever and as well as someone who’s, you know two months in you really are able to distill it down tothe important things in a digestible way and accessible way.
Stephan Livera:
Well thank you Matt. That’s very kind of you.I find sometimes I’m going too into the details as well. Sometimes I talk to, you know, normal people in the real world and sometimes they listen to an episode or two but they just think, it’s just like too much. So it takes a certain level of technical ability and a certain enthusiasm to go and learn to really get into it. I think one thing for you, like a question for you as well, like how do you, what’s kind of the, someone’s totally new, what are the sort of resources that you would point them towards to try to get them up to speed in a way that’s not going to totally turn them off while at the same time pointing them in the right direction.
Matt Odell:
Okay. So that’s not an easy question. It’s definitely easier than it was before. I mean to start it off there before we had theblock the, you know, the blockcrypto.com. Mike Dudas’ news company there was, there was probably not a single website that I could like wholeheartedly recommend. It was like if you went to a website like if I said like, coindesk is like relatively reputable, there’s still like 60% of their articles are like complete absolute trash, and the block like kind of still has some they like, they release like press releases that they shouldn’t be releasing because, you know, it’s just for some garbage project. But, it’s mostly there. You know, I really like that we have this new crop of high quality podcasts.
Matt Odell:
I tend to, I personally am a podcast addict. You know one of the reasons it was such a good fit for me to go into podcasts myself. And I feel like I’m so comfortable with Marty, even though it’s like the first time I’ve ever recorded on air was like a year ago. So the podcast format is a really good format for me to learn. I do like recommending the podcasts and, and I, we also have like this solid group of podcasts where I can basically wholeheartedly recommend to not worry about any, I could say to someone, listen to every episode of Stephan’s podcast, there’s not like a single episode there that I would feel like they would be getting steered in the wrong direction. Like that’s the biggest, the, there might be some that are too technical, but at least I know that there’s none.
Matt Odell:
It’s extremely difficult recommending something in this space. If there’s a potential where they go down that route and they get steered into the wrong direction. They get steered into scams. They get steered into certain sketchy situations because of either the ads or because of the content not being people need to have a certain amount of editorial integrity in this space. Otherwise the content gets overrun by horrible advice and horrible just content in general. So, you know, the podcasts, the podcast, I always say, Noded, I have you guys, I always say, I obviously tell them they should listen to rabbit hole recap. Marty’s interview series is like fantastic. The guys at block digest just are like constantly putting out good content reckless review I like, but they only have three episodes so far.
Matt Odell:
We’ll see if they keep it up. And then like, so like we have stuff like what Bitcoin did for instance, really like, I would never say to someone, listen to every single episode of what Bitcoin did. Any of them I can wholeheartedly recommend no, there’s like, there’s like a decent amount of episodes there that are like kind of questionable and kind of could lead people into the wrong direction. But I, you know I do like what Peter’s doing over there. He has a lot of solid pods. So where do I send people for their first intro into Bitcoin? I mean I like the Nakamoto Institutes catalogue. I like Jameson’s page, bitcoin.page. I tend to send them in that direction. The Bitcoin Standard made it way easier. You know, it kind of depends on who your audience is.
Matt Odell:
If it’s an older audience, I tend to point them in the, in the direction of Bitcoin Standard. As a younger person I tend to tell them, you know, create a new nym account on Twitter, jump into Twitter, you gotta Twitter takes at least six months to a year to like properly distill that shit let you down and see who you really want to be following and listening to like really active process. I like to tell people that, you can sit on the sideline and try and learn as much as possible before you buy any, but really you’re not going to learn anything until you buy a little bit too because you have to have, you know, you have to have some skin in the game. Like most of the stuff I’ve learned, I don’t know about you. Most of the stuff I’ve learned has been because I kind of recklessly jumped in and then had to like learn on the fly. Like how to not lose my money. What am I investing in? What the hell is going on here? And if you don’t actually play with it in your hands, it just never really it’s really hard to visualize any of these concepts or strategies or anything like that.
Stephan Livera:
Yeah, my sense on that is it’s very personality dependent, right? So some people are very perfectionist. They have to know every little thing before they go into it. And then there are others who are more like just jump in and I’ll just learn as I go and wing it. Right? So there’s different aspects there, but I 100% agree that really you learn by doing and so you need to just, you know, get your hands dirty and try to run, you know, run Bitcoin core, try to run these different pieces of software. But then obviously because it’s such a space, there’s so many scams and distractions, people can end up running the wrong things. So, yeah. But I think your recommendations there are really great. I think ultimately it comes down to sort of pointing people towards following the right people. So let’s say, you know, like pointing them towards the Nakamoto Institute, pointing them towards certain journalists in the space or certain podcasts in this space who you kind of trust a little bit more than some of the others in this space. Might also be good to talk about what are some common known mistakes and pitfalls because obviously you and I, we’ve been around in this game for a little while. What are some common errors that a newbie can fall into?
Matt Odell:
You know, I just go back on the previous question just for a second, you know? Yeah. And it’s great that we have content of on all different platforms now, you know, way more content than we have before. You know, one of the things I’ve been doing a lot lately is trying to get more people to use Wasabi. And what I’ve found is some people like watching YouTube videos, so I linked them to a guy 402 payment required, on Twitter, who has, he has a YouTube videos. Some people like reading the text. So then I just link them to a text guide. And then a lot of people like listening.
Matt Odell:
So I look linked them to, to your podcast with nopara. And, and so no matter what type of learner you are there, you’re able to like have a pretty good solid introductory, into wasabi. But, the crazy thing there is that from three different content producers, so it’s really hard to then transfer that into some kind of one stop shop, you know, Oh here you’re ready to go, you’re ready to start. Because you know who, decides what those three things are. Who puts, who says that I’m right about, about putting those things. So, anytime you have like a site that collates that stuff, then you have more issues. So that’s why I really liked Twitter. Anyway, back to pitfalls. As, far as pitfalls go. I mean the big one was coin loss, right? So then coin loss comes in cause like at the end of the day that is, I, I think the two biggest issues beginners have is either you lose your money, which no one wants to lose their money or basically you inadvertently leak your privacy everywhere.
Matt Odell:
And that could end up resulting in you losing your money at a future date. So as far as losing your money I am pretty sure you got in around the same time I got in like early 2013. Like back then it was way more difficult for us to securely store Bitcoin. Nowadays we have, you can pretty much tell someone get a Ledger, Trezor or Coldcard. I think there’s a huge dropoff in hardware quality after those three. So you tell that those three are very reputable. They’re used by a lot of people. There’s probably no critical errors in them. You can buy one of those and then this is where it gets difficult. How do you interact with that? You know, do we get into the whole?
Matt Odell:
Does every new user, should they all run full nodes? They all run this, should they all, you know, all run that. I think on a base level, just being able to say to someone, go buy this reputable hardware wallet, even take a step back from multisig or everything, even take a step back from using your own node. Just you have your hardware wallet, you use their built in UX, which from a privacy perspective isn’t great from a sovereignty perspective isn’t great, but at least you control your own keys and you probably, you probably won’t get hacked. And now that we have all these different methods, it’s a very easy thing to say to people. Use a couple of them, don’t use the same one. Don’t put all your eggs in one basket. If you lose something, you know, because look, we like saying, you know, don’t trust, verify all this stuff.
Matt Odell:
99% of people can’t check the code. They’re not going to be able to audit the code and look at it. So what’s the next best thing? The next best thing is you use wallets that are very popular, that are being used by lots of people and and you use multiple of them in different setups so that if one, for some reason one gets compromised, you don’t lose your, your whole stash. Now like what, two days ago or yesterday Wasabi announced that they’re about to release hardware wallet integration. They’ve already tested it with Coldcard and Trezor my two favorite hardware wallets. Yeah. So now we can tell people download wasabi, get a Trezor Ledger or a Coldcard user with wasabi. It’ll be the most private light node experience you can have because it all runs through Tor automatically built in. And if you have your own full node on your computer, if you decide that you know I’m ready to be a full bitcoiner, then you can run like Pierre’s power node launcher on your computer and and wasabi will automatically pull the blocks from your own full node.
Matt Odell:
So you’ll be able to use your hardware wallet with wasabi through Tor. Privacy preserving, and then also have easy access to coinjoins as well at the same exact time. So we’re close, we’re slowly getting to this point here where it’s becoming way easier to recommend privacy, preserving secure coin storage that is like very close to really mainstream user accessible. And then on the other side of that equation, we have these easy multisigs that are coming out with Casa and Unchained capital. Each of them have their own trade offs, but the capabilities they’re offering on the multisig front in terms of UX, in terms of user friendliness is like insane. It’s absolutely insane how easy they’re making it and that’s only gonna get easier. So I think in terms of terms of that, which is like the major pitfall for beginners, we’re sitting in a really great situation right now compared to where we were even like a year ago, two years ago.
Matt Odell:
I remember during the 2017 run-up, like there wasn’t really that great, you know, it was, yeah, it was really hard to, if someone said to me, how do I use Bitcoin without leaking all of my transaction data everywhere and still have secure storage, that was like – let’s sit down for two hours and go over how to set up Electrum personal server. And that, that was just a crazy conversation. Like that was just unrealistic. I wasn’t going to be able to, it was not scalable in terms of getting people to do that method.
Stephan Livera:
Right, exactly. And I like what you’re saying, because it’s very easy for people who are more technical to sort of say, Oh, you’ve gotta be perfectly cypherpunk and you’ve got to run full node and Electrum personal server and run and use some combination of hardware wallets with multisignature and do coinjoins. But for a newbie, it’s just overwhelming. They just cannot handle that. And I think obviously let’s be real, many of my listeners are not newbies themselves. They tend to be technical. But what I’m hoping to kind of tease out in this conversation is let’s put ourselves into the mindset of a newbie and what are the best ways that many of, you know, me and my listeners, when we’re out there talking to normies, we can try to give them an easy way in. So you know, something like, even having it, starting with a basic phone wallet and just having a, you know, a small play amount of money on there, whatever, 20 or 30 bucks worth of Bitcoin, you know, get them on, you know, Samourai wallet if they’re on Android or get them on Blockstream green. And then once they start to increase the investment a little bit more, that’s when you start to go, okay, get a Trezor or Ledger or Coldcard, start to look at with savvy wallet, get a desktop wallet going. I think these a kind of hopefully ways that we can point them in the right direction and then hopefully they will then go and learn more as they get into it.
Matt Odell:
Yeah, I mean I think that’s the way you have to go about it. You can’t, like, you can’t be like demanding perfection or expecting, you know, to them to go to these lengths that the more experienced users are going through. I mean, I remember like we had the, whole Samourai controversy where Greg Maxwell and others were giving samurai a bunch of shit and they were saying like, the alternative is like, you should be running Electrum personal server and then like electrum mobile on your phone and then connect them through Tor. I was like, there’s no way that anyone is ever, like, that’s not the user we’re talking about here. They’re never going to, from 99% of people like using samurais like way better than anything that they would be doing. You can’t expect them to set all this shit up.
Matt Odell:
That’s not, it’s just not realistic. But we can expect them to not use custodial wallets explained to them early on that it’s not your keys, not your coins. You know, the mobile wallet space is better than it’s ever been before and there’s never been like any major hacks of many of these big mobile wallets. So yeah, so like that’s how you have to do it. You gotta slowly like get them comfortable, get them used to framing this in the right direction and then slowly they’ll, they’ll improve their setup and, and they’ll, learn more and more. One of the big pitfalls are these custodial services. But I think that we’ve passed the point where they are, you know, the noncustodial options have gotten so, good that they’re, the advantages of using them is dwindling fast I think.
Stephan Livera:
Yeah, exactly. I think it’s really only a lightning thing now at this point. And even that will hopefully with time, if enough people get onto things like, say Pierre’s node launcher and so on, or even they, there are certain wallets that you can use. I know right now as we, you know, make this episode now in we are in April, in 2019, there is now eclair wallet and you can do a receive transaction on that. So even that is an example that you, if you want to do lightning just in a quick, easy way, you can just get eclair, obviously it takes a little bit more set up in terms of opening a channel, having incoming capacity. But again, we’re still very early in lightening days as well.
Matt Odell:
Yeah, I’m not ready to say that that custodial wallets are, you know, some people are saying that we’re just not going to have a choice. Like for the smaller users in terms of lightning adoption, they’re going to be using custodial wallets. I’m not so ready to say that fight is lost. And then the other one is Breez wallet they just announced, which is an Israeli company. They’re not custodial, but they’re not truly custodial, but they only open the only channels go through their node. So you’re still kind of trusting them, so they’re, I think there’ll be a little bit of a that’s one thing that, that Bitcoiners will be talking about over the next couple of months is what is that a trade off we’re willing to make that, it’s not, you technically control your own keys, but, but they can cheat you out of your money if they wanted to. Is that not an acceptable trade-off? You know, I’m really kind of, I really like this idea of like a node box in your home. Whether that’s, you know, like the nodl. I mean, you have a nodl. Yeah.
Stephan Livera:
I got an nodl, I have a Casa node. Obviously just as I’m a podcaster, I want to be familiar with some of the products. But yeah, my view is I want to see a healthy ecosystem of many of these things. Right. I want to see Casa node, not all Samourai wallets a collaboration with bitseed, their dojo product
Matt Odell:
When you to be like 10 of them. Yeah. We need a bunch of them. We need like 10, you know the more the merrier. We have what it looks like right now. We’ll have like at least three strong competitors, which is I think is like a minimum, like a minimum amount that like we could go with. But one of the things I like about the dojo, which is nice as the samurai one that’s coming out, is they’re gonna release everything so that you can just install, install it on an extra computer you have or something. So you don’t even have to buy the hardware from them, which I’m hoping some of these other guys also do. But I could see probably I think our easiest path to getting around this custodial issue will be if, people are able to run nodes at home and then connect everything to that master node you know, connect your mobile wallets to it, connect your hardware wallets to it, obviously connect, you know, all your lightning can go through it.
Matt Odell:
I think that might be like the super user friendly end result that we want. Because once you start like, I love Pierre’s launcher, but like once you start trying to run these things on like the computer you use every day that you’re like turning off and turning on stuff, it becomes way more of a user headache. And then the alternative there is like something like eclair where you’re actually running a lightning node on your phone. But it’s, you know, then what, so then we’re managing channels on two nodes cause you presumably also have a node at home. I dunno, we’re very early on lightning so that that can go a bunch of different ways.
Stephan Livera:
Yeah, I think you’re right there. I think there’s different schools of thought you might say. So some people might like, let’s say Pierre gets to a point where he gets the node launcher going such that you can also easily pair it with a mobile wallet and do lightning on it. I imagine that might be something he might be thinking about. And maybe the idea is, yeah, even if you, could just buy a three or $400 laptop and set that up and leave that on permanently running at home or obviously just buy a nodl buy a Casa, buy a, dojo node sort of thing. And I think the key idea would having your phone pair it back to your home node.
Matt Odell:
Yeah, I like that idea. I think, I think that idea makes the most sense for me in like a distributed cause. Cause let’s be honest, like we’re not just looking for, I personally don’t think that we should be stopping with money. Like I think that we should be pushing for more things to be distributed, particularly encrypted communications and you know, so you have like the free speech element, the privacy element, and that goes hand in hand with you know, just a distributed network in general. So you can imagine these boxes running everything that like a distributed home of the future would need. You’re gonna need to be running either, not Tor nodes. Probably. Hopefully not. Hopefully we have the next generation of Tor. You know, something that works a little bit better, but basically like you need people to be running, all different things from their home servers in order to enable all the good stuff that we, that we want to be happening. So you can imagine like a world where people are running Tor where people are running like distributed file systems, stuff like that. Yeah.
Stephan Livera:
I think the challenge is obviously, you know, we want privacy in some level, but then what happens is people want convenience and it’s so easy to just, you know, sign up to a, you know, an already existing service. And this is something I’m slowly trying to change myself as well because in the past I wasn’t as you know, privacy conscious about, you know, about some of these things. And I think similar to that idea before around sometimes you have to get people in, in Bitcoin just in a way to get them started in a basic way. And then slowly they have to go and learn why is it important for me to go and do these other things?
Matt Odell:
Have you used Blue wallet yet?
Stephan Livera:
I have installed it, but not actually put any Bitcoins or used it. I’ve, pretty much for from a lightening point of view, like on a mobile, I’ve used eclair.
Matt Odell:
It is Blue wallet is super, super convenient, it is such an easy on-boarding experience and it’s absolutely horrible for your privacy and you don’t have your own keys. But the on-boarding process is super, super simple. So yeah, I do think that, you know, there’s definitely a balance here where privacy, all this stuff is self-responsibility and privacy and self sovereignty. Like these things take work. They’re not free. They’re actually very costly. So people are always going to have to, I think, go out of their way to achieve these things and they have to think to themselves that it’s worth it. I think the way most people do unfortunately learn these things is through pain. They realize, you know, that they get a breach or their privacy gets compromised.
Matt Odell:
I mean, one of the things that really woke me up, I was fortunately already very privacy conscious beforehand. You know, the Snowden revelations woke me up a lot just in general. But what really woke me up is Coinbase sent like a, they had that court case where they sent two years worth of data on certain users. Withdrawal addresses, purchase history everything to the IRS. And I was one of those users. They literally sent all my data. You have to say to yourself, you have this wake up call where it’s, if I don’t protect my privacy, like no one else will. And I you know I go back, I’ve had debates with Murad about this. He thinks no one will ever care about their privacy. And I, you know it’s one of the few things I am like very optimistic about. I think that as like we have more information online in general, people will start to care more about their privacy and they will take action to protect it.
Stephan Livera:
It may be that people have to learn the hard way and they need to be more of these leaks that happen and you know, Facebook data leaks or whatever that puts someone’s data out there and then they might now start thinking more about these things.
Matt Odell:
Yeah. And I think it’s a combination of that and it’s a combination of making it as easy as possible for people. You know, until a year ago, maybe it wasn’t easy to do any kind of coin joins or mixing with like Wasabi changed that like just a single software project that ran adjacent to Bitcoin all of a sudden made you know, network level privacy, like within reach of people. Before that it was just, it wasn’t even, you know, I mean I guess I used to recommend like centralized mixing services cause that was like, that was the trade-off that I thought was user friendly enough and privacy preserving enough because like no one was ever gonna use JoinMarket. Like there was no way I was going to be able to walk a beginner through using JoinMarket. And Wasabi changed that they made an easy piece of software that newbies can actually use if they so desire and all that’s left is getting them to desire it in the first place.
Stephan Livera:
Yeah. Gotta make them want the freedom for themselves. Right. Yeah, exactly. What are some other what are some other kind of common scams or pitfall ways of thinking? Right. one example I could bring actually you know, over the years as new people kind of hear about Bitcoin, they would come to me cause they knew me as like a Bitcoin guy within my kind of real life circles. And they’d be like man, how do I do mining? Like let me set up mining and stuff because, and then I would always be pretty much cautioning them. Look, unless you’re going to like go and invest a lot of money and time mining is not worth your while. Just buy the Bitcoins. Right. And people would see these ads for things like, Oh, cloud mining and whatever. Right. What are some other ones that you’ve seen over the years?
Matt Odell:
Mining is such a bad one, man. It’s just, you can’t convince someone that it’s a bad investment. You just have to let them do it. Like every single person thinks it’s the best fucking idea ever. Especially cloud mining. Cloud mining Oh, I get an ROI. It’s a return. It’s such a safer investment. I’m like, dude, you’re just making a leverage play on Bitcoin.I had so many people in 2017 who told me that like, Oh, I want to do this cloud mining or I want to do that. Or I want to actually go into mining who bought a bunch of GPUs and decided they were going to mind shit coins and then pull it over into Bitcoin. And like, really at the end of the day, you just gotta be like, okay, like I’m just telling you, like you need the price to go up to make money here and if the price goes up, you’re going to make more money if you buy it.
Matt Odell:
But at the end of the day, they have to, they have to learn that, themselves. I mean, I know I did cloud mining when I was starting. I thought that’s like an idea ever, you know, and the reason I know it’s not is because it wasn’t. And then I quickly learned I think I got exit scammed by one cloud miner at one point and like the one that didn’t exit scam me, just like, you know, obviously I didn’t get the right ROI on it. I, I think, yeah, so cloud mining would, that’s actually a really good one. I didn’t think about that. And it’s way bigger than people realize. I bet. What I think, what is it Genesis mining or something, someone had like a big hack six months ago or a year ago, I want to say it was Genesis mining and the amount of money they lost, it was like, Holy shit. I didn’t realize people were still doing it to that level. But yeah. So you have that. I mean you obviously have alt coins yeah. I mean people don’t remember, but like Havelock investments. You remember Havelock investments?
Stephan Livera:
Oh, I feel like I’ve heard the name, but I don’t. Refresh my memory.
Matt Odell:
They were kind of like, I guess like security token offerings before STO’s were a thing or whatever. They like treated like fake stocks on, have like investments, but you couldn’t like withdraw them as tokens Neo and Bee were on there, a bunch of miners were on there. I think like ASICminer was on there. And everyone just lost all the money that they put into havelock investments. I don’t think there was a single, there was like a couple that were profitable for like a little bit and then everything just fell in on itself. So, I mean, I think, and like look at the end. I’m not like a Bitcoin maximalist that says, you know, you should never speculate in any of the alt coinsor trade them or whatever. Like fuck it.
Matt Odell:
Like if you want to gamble on super volatile illiquid cryptocurrencies, like absolutely like go have fun, but it’s going to be brutal and like you probably will get fucked. But that’s a major use case of Bitcoin is the altcoin casino. What I would say is the number one thing is if someone tells you that there is no trade offs, there’s tradeoffs. So they’re lying to you. Like they’re either willfully lying to you about there not being trade offs or they’re so fucking dumb that they don’t realize that there’s trade offs themselves. So like that’s a huge red flag. Just always, just assume there’s tradeoffs everywhere. And if they’re not talking about the trade offs, then they’re, intentionally misleading you or, or they haven’t done enough research themselves.
Stephan Livera:
Right. And I think one other thing, like again, we have to put ourselves, cause you and I have been around for a little while, but you have to sort of put yourself into the mindset of the newbie and try and understand what’s in their mind. Because I think a big part of it is they feel they missed the boat on Bitcoin. Right? They feel like, ah, if only I bought back in, you know, whenever, whatever year and now I’m not going to get a 10X if I buy a Bitcoin now, but I might if I go and buy this shitcoin Ripple you know, there’s that whole mentality and I think that is something we as kind of more experienced Bitcoiners and probably my listeners have to think about when they’re talking, when they’re out there trying to, help explain Bitcoin to newbies.
Matt Odell:
Yeah. Oh yeah. Like ripple. If Ripple goes to $10, like I’m going to be this rich or whatever. Yeah. I, mean, when, when, when I got involved in 2013, I thought I was late to the boat. I think everyone thinks they’re late when they come in and no matter what, when you come in and we’re all early, like we’re all ridiculously early. But it’s natural to think you’re late. And I think a lot of the ways people realize that is they kind of get wrecked on, on altcoins and then they come back you know, it’s like the same idea as like the painting. Like you can tell the five-year-old not to touch the stove like a million times, but like he won’t touch the stove once he touches the stove, he needs to get burnt and then, and then he realizes, you know, Oh, maybe they were onto something.
Matt Odell:
I th I think and I, that was one of the reasons, like, it’s like, it’s like crazy to me that I like for a little while there, like, people were really attacking HODLers, like people who were basically saying, you know, like dollar cost average responsibly. While that is like the least risky investment strategy you can take in any space, especially this space. So, you know, that was one of the reasons why like the whole, memeified the stacking stats idea, right? Because I think that that that is like the most conservative way that you can get exposure to this space and learn about it in like a slow and steady way with money you’re willing to lose. And it kind of, I think part of the reason is like, it kind of got corrupted by altcoiners that were also saying to HODL those in to become a bag holder of those of those shit coins and it kind of corrupted it.
Matt Odell:
But that’s, that’s really, I mean if you back test it like that, most people can’t time bottoms and tops like they shouldn’t be. Why would they be trying to do that? That doesn’t make any sense to me.
Stephan Livera:
Oh, I’m a big believer in that as well. I, occasionally like to kind of read and sometimes on my, you know, as you know on my podcast, I’ve spoken to people who do do some element of timing the market, but I’m personally, I don’t really believe you can. I think you just buy and just hold and just regularly you know, take a position and that is really the like, in my view, a safer way to kind of accumulate. I think the thing, now, the other thing which we have to be wary of here is we put ourselves back into the mindset of like, when there’s a crazy bull run, everyone just loses their mind. They’re not thinking the straight way and then they’re not. And even then people are not paying attention to the cooler heads in the room, so to speak. They’re looking at, Oh, look at this crazy new alt coin that’s going to pump 10 X, right?
Matt Odell:
Yeah. I mean in 2017 it was like really hard to keep your head straight. I mean, I was talking to Pierre about this and we both shared similar sentiments that we were very conservative about how we felt about the market in 2017 like kind of up until the point we had 10 K we were like guys like t any point like, like we could go back down, like just be responsible, like only use money you’re willing to lose. And then once we breach 10 K and like we were on our way to 20 K like you start going through your head like crazy things like we’re just hyperbitcoinization is happening now.
Matt Odell:
The cycles, the cycles are over now all of a sudden like the cycles aren’t the same anymore and this time it’s different and we’re just going to the fucking moon and you better get it now. Otherwise like I can’t sell any bed of it because if I sell a little bit like that’s going to be worth so much more in just a year from now and you really get screwed mentally. So that’s why it’s really important too to like have a plan, like stick to the stick to the plan. And try and I like a really good strategy is at least for people that don’t delete on Twitter, it’s really nice to go back to different time periods and see, you know, what people were thinking, what people were saying during those time periods to try and get yourself out of your own mental your own mental head.
Matt Odell:
I was actually, I’m just thinking like one pitfall that I think will become a bigger issue is people holding like centralized altcoins and tokens. And not realizing that they’re not your keys, not your coins. I mean your audience, my, audience probably less likely to have this affect them. But like for instance, like something like Binance coin like that’s completely centralized. So essentially any binaries going you own are not your keys, not your coins. Like even like there’s no, there’s no such thing as like cold storage for like a centralized coin because everything can change out from under you. It doesn’t matter how you store your own keys. The whole network can change overnight. The whole thing could be worth zero overnight. So I think we’ll have more. And then the same goes with like pretty much all the ICO tokens of 2017 and whatnot.
Matt Odell:
And some of the centralized more traditional cryptocurrencies I guess if you want to call them traditional cryptocurrencies you know, something like I guess like EOS or whatever. Like who knows? Like you can put it in so-called cold storage for eight months and then you come back and maybe your keys work, I don’t know, like fucking Larimer is done worse than that before with like bitshare and stuff. So you never know.
Stephan Livera:
Yeah, exactly. Even with the if the coin is continually hard forking, then that also introduces a whole new layer of risk for everyone involved. Right? Like what if the wallets are not kept up to date? What if, you think a certain transaction will work, right. It doesn’t, it just, it brings in a whole new level that I think I really appreciate that Bitcoin, you know, tries to maintain that backwards compatibility.
Matt Odell:
Yeah. I mean, I think, and this is kind of where I think that the idea of telling newcomers, like don’t under any circumstances buy any shitcoins because you learn a lot of this from speculating in shitcoins. Like I, a lot of a lot of the I have now is because I got burnt, I got burnt with, with altcoins in the past. I mean, one thing that’s like kind of, I guess kind of interesting is like in the, when I was bored in the depths of the last bear market like I picked up like some vert coin, I, you know, whatever, it was supposed to be like ASIC resistance, right? That was, that was before I realized that ASIC resistance doesn’t exist and like that we should be embracing ASICs. But that was part of my learning process to get there.
Matt Odell:
And so I guess like during the 2017 bull run, like vert coin hit like $8 or something crazy, I don’t know, whatever it was, it was like crazy. It was like 20,000x or something insane in Bitcoin terms. And I was like, Matt, I think you got some vert coin, like let me go like check this out. And I found the wallet and it was encrypted and the wallet maintainers stopped maintaining the wallet. Three years prior. No one on the vert coin team had done anything to bring that up to spec or whatever. And I was, it was impossible. Like I wanted to just market dump the coins. I don’t even know how much is in the wallet. I was never able to access the wallet. You know, it just wasn’t that that was gone. It was just lost cause didn’t bother trying.
Matt Odell:
I put like a meaningless amount of money in it, like in 2015 and I forgot about it, whatever. But it’s a real wake up call that if you don’t have, if you’re not looking five years in the future, 10 years into the future, 20 years into the future and how you develop these systems like you’ll, they can never be, we can never have, like it’ll, it can never be a global standard money. Right. Like you can never, there needs to be some assurances that, you know, Marty likes to say like the man in the coma, you know, like when you wake up out of your coma 10 years later, like you gotta be able to access your money. If you can’t access your money, then we failed. The project has completely failed.
Stephan Livera:
Yeah, that’s a good it’s a good little story. Nice anecdote there. I’ve got another idea to talk about as well. Actually, it just came to me because let’s think about it this way. The scams that were done in the past won’t be done in the same, in the future, right? So scams of the future. Maybe, you know, affinity scams. There might be somebody who tries to associate and look like they’re, you know, they’re like you, they’re a real bit coiner, but then actually they are, you know, maybe they’re doing some dodgy software and you trust them with the software and that causes you to lose some of your coins or you know, they scam you in some other way. So these are things that we have to even think about in the future as well because the scams of the future may rhyme, but they may not be the same as the scams of the past.
Matt Odell:
Yeah, I mean I think we have like some exciting scams in our future that we’ve just barely scratched the surface. Like scammers are very creative bunch. I mean look at like the Eth scam, the Eth scams we had in 2017. Like I didn’t see that coming. And they like got a lot of money. They got like a decent, decent fucking haul I think ICO’s, are probably pretty much dead. Hopefully I think we’re going back to the quote unquote fair launch proof of work coins which I find a lot more tolerable. I think like the whole ICO mania was like a very big low for us. And it was brought on starting with the Ethereum that showed like the playbook of how to do it and they all prioritized ICO development on their platform was like the first thing that they pushed for and they all had their hands in it.
Matt Odell:
Yeah, but I mean we already see like the affinity scams kind of like with like the Andy Hoffman’s of the world, like pushing BRhodium or whatever his like garbage fork is.
Stephan Livera:
People like Richard Heart as well.
Matt Odell:
I was about to say I was about to drop him.
Stephan Livera:
He built up this reputation.
Matt Odell:
He did it intentionally for this. Like there was no way, like that was the whole plan. Like he spends six months, like courting bitcoiners, right. And then you just throw it down a shitcoin, you know, runway and you just hope you get some of them and it’s like super easy to monetize without ethics in this space. So like yeah, so like, that’ll, that’ll be, you know, and who knows? Like did Kevin Pham sell his account? Like, I don’t know, but like he could have, he met me. He might have, you might still be controlling it and getting paid on the side and you don’t know, but that’s Mmm.
Matt Odell:
You mean some people just lose it as well. So it’s, hard to necessarily tell if there’s malice there, but I think we’ve always had affinity scams and we always will for sure because because they’re easy, they’re easy to pull off and a lot of people that, that do put themselves intentionally in the limelight, in the space, do it in so that they can then push, you know, like we have, you have the obvious examples, right, where you have like the Richard Heartwins and you have the Andy Hoffman’s and then you have like kind of like less obvious once like, like Bruce Fenton and Raven coin. You know, he, is that malicious? I think it kind of is. He like uses this position as like a well known bitcoiner to push that coin heavy.
Matt Odell:
But it’s on the same level as like a Richard HeartWin or something like that. Like, I don’t know, like a or like a Charlie Lee and Litecoin. You know, I have a lot of ill will towards Charlie and Litecoin. But yeah, it’s a very delicate, it’s a very delicate balance I think. I think the big thing is, is if they’re not, if they’re not properly disclosing the trade offs, if they pretend the trade offs don’t exist, I think is like a really good measurement of whether or not someone just acting unethically in the space. I mean, I remember, you know, like what, like, so one of the big things that Charlie likes to pitch about Litecoin is like, it’s silver to Bitcoin’s gold. Like that makes zero sense, makes absolutely no sense.
Matt Odell:
He doesn’t care. He knows. It makes no sense. He says it anyway. He was, he was pushing the whole narrative for a while. He kind of still is that Litecoins, like the cheaper way to access the lightning network. Like that doesn’t make any sense because there’s going to be plenty of all chains that support the lightning network and they’re all going to be in a race to have the lowest fees. So that’s not a sustainable way of, of setting up your network. So either you just race to the bottom and completely destroy your network or you’re not going to be the lowest and fees. So someone who’s going to use digibyte to fund their lightning channel and, you know, and he just tentatively ignores that. So I, do really like the, the tradeoffs. And also I just think in general, like if you’re shilling illiquid tokens and altcoins and you have like a big following, then that’s just inherently unethical to a degree because they’re just so illiquid that, you know you can move the price.
Stephan Livera:
Yeah, precisely. And I think, yeah, you’re right. And I think this whole yardstick of people who lie to you about no, no trade offs typically that is in the past, at least historically, it has proven correct that that person tended to be a scammer or pushing some sort of questionable altcoin, let’s say.
Matt Odell:
Yeah, look at like the block size. Like anyone who was saying that the block size argument was about storage, right? When it’s really about mostly about bandwidth and they know that and they’re like, Oh look, this is a one terabyte SD card. You know, like obviously we could do, you know, gigameg blocks or whatever, you know that’s , you immediately know that they’re acting. They’re either acting out of bad faith or, they’re an idiot. And either way, that’s not a good thing.
Stephan Livera:
I think another one is just KYC. Like, obviously KYC is difficult right there depending on where you are. And like if you’re a newbie, how else do you get coins? Right? Like obviously the, in the past there was local Bitcoins. Nowadays there’s hodlhodl and bisq. But it actually, you can see how if there’s not enough volume, then people will just use KYC services.
Matt Odell:
Yeah. I mean, I, I’m like a huge proponent of privacy and I’ve only gotten my coins through KYC sources. I there, you know, it’s this is another one of those things where it’s like, you really shouldn’t be like, you can’t tell newbs to go use bisq. Like that’s crazy to me. Like they, that is way too difficult of an onboarding process and they could just as well get robbed in the process of trying to buy it in the first place. So you you enter all these other risks. I think now that we have things like wasabi, you just, you have to pound it into them early on that if they use a KYC service, which they probably will have to any of their transactions to and from that service can link all of their other transactions and they have to make sure that it’s isolated with wasabi.
Matt Odell:
I think that’s like a nice balance. You know like you use cash app and you withdraw to wasabi and then you mix and so like they, cash app knows you bought Bitcoin but they don’t know which Bitcoin is yours I think is like a, it’s like a decent balance and hopefully you know, bisq gets more volume, you know more liquidity. But like right now it’s like, it’s like kind of unfortunately kind of unusable. I haven’t used hodlhodl they don’t allow Americans and I cause a bank account. But I think with Hoddle Hoddle like a bank accounts involved, right?
Stephan Livera:
Yeah. Right. My understanding is there’s different ways you can use it and you can use bank transfer as one method.
Matt Odell:
Yeah. So if you use a bank transfer, like it’s connected to your name and in ways, I mean I was, once you start going down the privacy rabbit hole it gets, you can get really paranoid about it cause all it takes is one little thing to mess it all up. Like I was talking to someone like, you know, like looking up an address without a VPN on a, on a block Explorer, you know that can leak your information right there. And people don’t even think about that. So you need to get them to use VPNs, you need to get them to get used to Tor But even with something like that, like blockstream.info does, it says they don’t track and they have like a Tor address, you can use we didn’t have that before. You know, like now at least we can be like, okay, like you should be using a VPN, but if for some reason like you forget it, like hopefully, you know, Blockstream probably isn’t logging your IP address. It’s all, very much a balancing act.
Stephan Livera:
Yeah. And I think, look, if I had to summarize, we’re in a much better place now in April 2019 compared to, you know, early 2013 or whatever.
Matt Odell:
Even December 2017
Stephan Livera:
Definitely. Even from that, I mean, we kind of easy coin mixing now coin joining now and who knows what’s coming next. And the other challenge is just kind of keeping material up to date, right. So even if I took, if I just, you know, spent all my time making a newbie guide, it would be out of date within say six months.
Matt Odell:
I did that, I fucking did that. And it was out of date quicker than that. You know, like I was like walking people through how to use like blockchain.info and mycelium and stuff. And then I was like, basically once that, once that went out of date, I was like, Matt, I’m done with long form content. I’m not doing any of this shit anymore. Like other people do it, I will signal boost them. But that’s what I really like. I, you know, I really like Twitter. I really like the podcast because I’m able to get as much content out there as possible to help as many people out there as possible without putting in too much time because the space changes so much that I would just be updating it forever. Like I would never, you can never like just stand still. In terms of like best practices, like I feel like in like two months I’m going to be saying like, Oh, there’s probably another best practice that you should be doing instead.
Stephan Livera:
Yeah. Well I think that’s a insightful comment and we, yeah, just have to kind of keep updated. And as Bitcoin people who like us, like you and I, and you know, probably our listeners as well tend to be the hardcore listener, hardcore Bitcoiners. So it’s kind of on us to go and figure out what are the simple ways for newbies and try to help our newbie friends. Oh, Hey, you know, use coin mixing and use these tools. Have you got any kind of last comments around the around this stuff that you, you know, you think we haven’t touched on?
Matt Odell:
Well, I think two things. I think it’s really important that all of our listeners go out of their way to help their friends and family. We like, we need like a knock-on effect. Like you kind of mentioned it earlier that you have like a lot of people coming to you cause you were the Bitcoin guy like in 2017 and like I had the same thing and that’s one of the reasons why I do the podcast and I do Twitter and stuff. It was because I was answering the same questions over and over again with my friends. I might as well do it for others as well. But I think like one of the best assets we have at our disposal is that we have all these Bitcoiners that are super enthusiastic that are super engaged with the project. And it’s up to them to help guide, you know, like 10 or so friends and family down the right path as well.
Matt Odell:
And like hopefully for those people they have good people that are guiding them. But I think that like we’re increasing that base of people that can do that and then they can go and, because like the end of the day, like you can respect what you say, but like they, they’re not going to be taking straight advice from some guy in Australia that they’ve never met or some guy in New York that they’ve never met to, to actually hear it from a friend that they trust, a family member that they trust, that’s, that’s willing to sit down with them and like set up a Trezor with them. Is like a huge, huge bonus for that person. That person is able to enter the space in a way more comfortable situation than they would otherwise. So I think it’s, it’s on us and it’s on all of our listeners to pay it forward.
Matt Odell:
If you had someone help you get into the process, like you help someone, you know, get through the process. And then the other thing is like it’s really hard doing what we do when we have people that own like bitcoin.com and blockchain.com like actively working against us. And then like one of the things I always forget when I talked to beginners is like I actually have to tell them, you have to tell them like straight up, like ignore bitcoin.com ignore blockchain.com don’t ever even go to the, anything you see on those sites could just be garbage. Like don’t, don’t go to it. I like all the big news sites like CCN don’t go to Bitcoinist don’t go to it, newsBTC, don’t go to it. Like that’s ridiculous. Like that’s absolutely ridiculous. That doesn’t exist in any other space where like if someone was like interested in iPhones it wasn’t like, Oh like if you go to iphone.com like you’re going to get wrecked. Like that’s ridiculous.
Stephan Livera:
That’s a good point. I didn’t think of it that way. But you’re right.
Matt Odell:
That’s one of the little things we never, I never, I always forget about that. Like bitcoin.com is just like not a good site. I was like, don’t go to that.
Stephan Livera:
Yeah, there’s a lot of pitfalls in this space, so hopefully hopefully this discussion has helped our listeners at least point left their newbie friends the right way. So look, Matt, maybe I’m pretty sure pretty much all my listeners know who you are, but just in case any of them don’t tell them where they can find you.
Matt Odell:
So I’m on Twitter. I’m matt_Odell. My Dm’s are open. I’m on keybase, wire, telegram all under Matt Odell. You can reach me there if you don’t want to go through Twitter DMs my PGP keys on Keybase always happy to help. I do a weekly review podcast with Marty bent on tales from the crypt. If you go to tftc.io you can get that feed. He does interviews like Stephan does and, and and I do a weekly review podcast with him. And part of what that podcast is for is that, you know, I listened to a bunch of other podcasts, I follow a bunch of people on Twitter. I get a bunch of newsletters. I’m looking at the news and stuff. Inaudible looking at the news and we try and distill stuff that is actually important, that isn’t filled with all the noise and all the bullshit that this space is dominated by.
Stephan Livera:
Fantastic. And yeah, I definitely recommend for any of my listeners who are not already subscribed to tales from the crypt, go subscribe to that. It’s a fantastic podcast. Lastly, thanks very much for your time, Matt. Thanks for coming on the show.
Matt Odell:
It’s been an absolute pleasure, Stephan. Thanks for having me.
Stephan Livera:
Hope you guys found that useful. I think as Bitcoiners we’ve got to take it on ourselves to help educate our friends and family into doing this the right way. And lastly, yeah, just make sure you tell your friends to subscribe to the podcast and hopefully that’s one way that they can get onboarded to Bitcoin in a better way than falling prey to all the shitcoiners and blockchainers out there. Thanks guys. See you next time.