Welcome to the Dojo

Hi and welcome to the Stephan Livera podcast focused on Bitcoin and Austrian economics. Be a better Bitcoiner by improving your knowledge about the technology and economics of Bitcoin. Today, my guest is one of the founders of Samurai Wallet. He is operating under the pseudonym Samurai Wallet, and he first appeared on the show back in S-L-P twenty-nine. So make sure you go back and check out that episode before you see this one. They're doing some really interesting things in terms of releasing the Samurai Wallet backend, Dojo, and offering Whirlpool, which is their coinjoin implementation. But first, a few quick words for my sponsors. Firstly, Kraken. So over my years in Bitcoin, I've been impressed with the way Kraken operate in terms of offering strong security and acting ethically in the space under Jesse Powell's principled leadership. They're one of the longest standing Bitcoin exchanges and they're consistently rated the best with a high quality platform offering the best liquidity in the industry. They've got high trading volume and low fees with no minimum or hidden fees. Kraken have twenty four seven support and I found it extremely fast to go through the sign up process as an individual. On the institutional and business solution side, they're very popular with institutions too, ranging from funds, asset man- Managers, trading firms, crypto businesses, they offer the highest available APR rate limits and there's a Kraken OTC desk. Kraken offer five fiat currencies and also offer margin and futures trading. To learn more and sign up, go to the Kraken link in the show notes. Secondly, announcing another sponsor, Unchained Capital. Have you looked into Unchained Capital? They're a Bitcoin financial services company offering a really cool two of three keys multi-signature vault product. You can use Trezor or Ledger wallets and you still maintain control with your two keys. And reduce the single point of failure risk. Multi-signature helps protect you against the proverbial five dollar wrench attack, as you can distribute your keys. I've set up a vault with Unchained and found it super simple and easy. Customers who create an Unchained vault also get three free months of access to SafetyNet's Bitcoin Standard Research Bulletin, which is a fantastic resource for my listeners interested in Austrian economics. Unchained also offers Bitcoin collateralized loans, allowing you to get USD liquidity without selling your bitcoins, meaning you don't trigger a capital gains event. You have to consider your own scenario, but this can be tax efficient for a hodler, enabling them to continue their hodling rather than selling bitcoins. While a loan is outstanding, your bitcoin is secured in a dedicated multisig address under collaborative custody with Unchained holding one of three keys, you hold a second key, and Unchained's independent third party key agent holding the third key. So to learn more and sign up, go to unchained-dashcapital dot com. So with that said, onto the interview. Samourai Wallet, mate, it's a pleasure to have you back on. There's been a fair few things that have happened since the last time you were on, hey?

It's great to be back with you. I enjoyed our time on here, so much last time, and I've been looking forward to coming back, so thank you for having me.

Excellent. So, look, I think just for the listeners who haven't heard, make sure you go back and check out SLP29, which was our first appearance together. And, look, Samourai Wallet, I think

How many other Bitcoin companies and services operate, because they operate in a more sort of KYC fashion. So can you tell us a little bit about your vision of this and how Bitcoin can be used in this way? sure.

Hey, I think, a slightly different vision to say the least. We believe wholeheartedly that, you know, KYC is a creeping disease. You know, there, there was once a time that I, I remember, wasn't that long ago, where you could open a bank account, get a job, rent an apartment without having to prove who you were, where you lived, and how you got there. Now that concept is so foreign and so alien to almost everyone that, you know, they can't picture a world without such practices. To us, this is the perfect Perfect example of social engineering like on an international scale. the, to us, the, the, you know, Bitcoin and KYC, AML, they're like oil and water, they don't mix. Shouldn't be accepted and embraced, and embraced, and, I think service providers take, you know, have to take some blame, but users also have to take some blame. You know, they, they have accepted these conditions, their, their implicit acceptance. validates the creeping disease, you know, it, it feeds it. I don't wanna go on too much about it, because I think our views are pretty clear on it, and I, I feel like I'm the old man yelling at the clouds. But I'm, I'm from the generation of Bitcoiners that view Bitcoin as the ultimate opt-out from state-controlled money system or fiat or, you know, whatever you wanna call it. And I don't understand how one can opt out of state-controlled money by opting into state-controlled and mandated identification processing.

Right. Yeah. I think it's, I think it's, I, I definitely hear that. Obviously, you know, it's not like I agree with many of the regulations or any of them really, but it's, I guess, it's just a difficulty that many people face in-- for a, a quick example would be, how can they get a lot of bitcoins without KYCing? And I suppose the answer will be non-KYC services, things like Bisc, HodlHodl, and so on, but I guess the volume on those is still building, isn't it? Yeah, volume's still building, and,

and Those platforms haven't had a chance really to, to develop as quickly as they otherwise might have if, like I said, consumers weren't so willing to accept and, and in some cases embrace the KYC/AML side of things. Like we've been talking about this at Samourai since 2015. we, we called it creeping KYC, and it was when non-custodial wallets like, Blockchain and Mycelium and, you know, other, all of them almost, they started partnering with KYC fiat bridges. And this was like, you know, the only-- I guess the only thing they could think of in order to generate some revenue for the product, for the wallet, which, you know, monetizing a Bitcoin wallet has been a, a questionable prospect at best. I think we've done a, a good job of it so far, but it's still questionable. And this, this, you know, it betrays a fundamental misunderstanding. Bitcoin isn't Venmo, it's not PayPal, it's not Disney Dollars, it's liquid cash, right? It's liquid cash for a privacy star of society. It's the opt out from that society. How do you get it? You know, there's, you, earning it's the best way right now if you wanna do it non-KYC from the exchange or start using- Non KYC exchanges, like decentralized exchanges, start using, I guess what are they, Bisq and Huddle Huddle and, and all those ones. And, and if you're, you know, if you, if you, if you're able to provide products and services and earn in Bitcoin, do that, even if it's just on a hobby basis, that's, that's a good way to do it as well. You know, you might not be able to get massive volume at least initially, but, every little helps, right? you know, it's so important just On, on, criminalizing certain cryptocurrency transactions or even just use of cryptocurrency in general. So, and, and I think that's, you know, I don't think that's gonna either be enforceable or even get past the proposal stage. But you have to think about that, you know, governments change Opinions change, regimes change, attitudes change over time, but those records are gonna remain.

Yeah, no, that's a great point. I, I can't really disagree with you there. That is absolutely a concern for anyone, and it's a trade-off that everyone has to consider about volume right now versus improving their privacy in the here and now. and I think that might be a good time now to talk about some of the recent, news around the funding from Cypherpunk Holdings. So tell us a little bit about this and what is it? Gonna enable for the Samurai Wallet team? Oh, sure. Well,

we were really happy to meet with, the guys at Cypherpunk. You know, they reached out to us and while we were skeptical at first, we met with them a few times and realized we have a, A shared value system and a shared future, a future goal, which is in increased transactional privacy in Bitcoin, available to all users. And, yeah, so we were able to raise a hundred thousand, paid in Bitcoin since we're a Bitcoin company, and we're gonna be able to Well, do two things primarily. One is increase the development capacity on the Android side of things, 'cause, that's very, very pressurized right now. There's only one person doing primary development with T, TDev overseeing things. So getting a, a second person on that team is just gonna be so beneficial And then the second, the second person that we're, we're looking to hire is a, support, a customer support and a slash QA tester, and that's gonna enable us to actually release new functionality quicker, because right now we're developing quicker than we can release. we have a very, very, comprehensive QA cycle. We need to make sure everything is working as expected and, and properly before it gets, rolled out to users. and with, with one person with support from the rest of the team, but one dedicated person doing that, it's not a, you know, that's not enough capacity. So, those are the two main areas of investment that we've highlighted right now.

Yeah, it's interesting, hey, like, I mean, you look at, the, you know, quote crypto space, and you look at the, you know, people like EOS and so on who've got like four billion in funding, and then, and then you guys are here on To still deliver a product.

Yeah, yeah, I, it's, it's just crazy to me. I can't imagine one even raising that much, that much money. I don't think that would be even appropriate for what we're trying to do. But yeah, I think what, what we raise, it's, you know, in the grand scheme of things, it's modest. you know, it's not gonna, it's not gonna increase the runway dramatically because we're bringing on two additional, people, but it's gonna relieve the pressure and, our product is So and it's gonna, it has the potential to generate more revenue in the future. So I, you know, this is, it's a timely investment, I think it's gonna enable us to, deliver our product more effectively in the short term without any sort of, long-term negative benefits at all. So we're really, we're really excited about, about this and, hopefully we'll have, further announcements soon. Around development of the, of the team and whatnot.

Fantastic. And so I've seen obviously the recent announcements of Dojo, the release of the Samurai Wallet backend. So, you know, welcome to the Dojo. Let's, let's hear a little bit about what that is and why should the user use this?

Okay, sure. Well, so Dojo is- Let me see how-- It's basically a, it's a full-featured wallet backing server. So basically what makes Samourai run today, and our server is in Iceland, is Dojo. Everyone who uses Samourai Wallet today is using it via our servers, our our dojo server in Iceland, right? What we've done is open sourced that, made it freely available to the public, and packaged it up in a single Script that can be run to install everything, self-sufficiently. So why would you use this? Well, if you-- like I said, right now, if you're using Samourai Wallet, it's our, our Dojo. If you're worried about us tracking you Tracking your payments and then, like, you know, reporting those payments, and balances and transactions to someone. Or you think that we're some sort of honeypot, and, like, NSA honeypot? Well, then you can completely bypass all of those concerns by running your own dojo and connecting your wallet to it. The other nice, interesting thing is for developers, which we, we're, we're not, you know, overall advertising this, 'cause primarily it's, it's, designed for wallet users, Samourai wallet users, and Sentinel users who wish to have complete sovereignty, right? Not rely on, on us or anyone at all. But developers can also use the built-in wallet API, to create their own applications that sit on top of Dojo. There's nothing stopping them from doing that. So, if they wanted to create their own web wallet or desktop wallet or something like that Dodo can be used for that purpose as well.

Fantastic. So I suppose just to articulate then for some of the listeners, one concern that's been shared in the past is that, oh, if you're using this Specific, explorer wallet, meaning that wallet will generally have your xPub, meaning they will know all of your past transactions and all of your future transactions. However, when you are using something like, for example, Electrum personal server or some similar software such as Electras and so on, or now with Dojo, you are maintaining additional privacy by not leaking out which addresses or xPub you hold. And so that's, that's a Really good thing for the privacy aspect and, and, I suppose just for you, Samourai Wallet, it's, you know, one of the, you know, call it fair or unfair, the knocks against you guys was that while Samourai Wallet has good- features from a transaction graph privacy point of view, things like CoinJoin and so on. The, the knock was about internet privacy, or rather the, the fact of, polling, you know, that you-- that it would poll back home to figure out what the balances were, which, which in fairness is a concern with any mobile, pretty much any mobile wallet, unless you connect that back to your own full node. Yes. No, no, I, I don't even

think that was a knock, that was just the case, that's true. That is what was happening. And Conflicting transaction privacy and network privacy, 'cause they are two different things. So, so yes, we-- I mean, since, since, 2015, we've been very honest and open about what our limitations were. You know, back in limitations when we first started in 2015, we relied on API information from, Blockchain.info and then later from various other API, sources that was very, very quickly replaced with our own backend, which later developed into- To Dojo, and we've always communicated this with the user, and this is, this is the primary reason Samurai Wallet has remained in alpha status for such a long time, 'cause I didn't think it was ethical to release a one point o product Privacy product to the user and still, either rely on API, like third-party APIs, which we stopped in two thousand and seventeen, like I mentioned, but, also where they weren't able to overcome the network privacy angle if they, if that was, a concern of theirs. Now, it's not a concern of everyone's. Some people are completely fine phoning home to Samourai Wallet with their xPubs. They don't, they don't have an issue with that. I would, I would, I would suggest that those types of users eventually migrate over to a Dojo-based system because it is better for them long term, but also better for the network long term as well. But there's no- Fantastic. Yeah, there's no real issue, because, you know, like you said, almost all light wallets have this limitation where you have to phone home information to them. I mean, that's how they're able to feed back. balances and transactions to you. Now, one I think one sets Dojo apart from everything else, as far as I can tell right now, although we'll, we'll have some stiff competition in the ease of use factor from, Pierre's node launcher, that's very, very easy, easy to use from, from what I can see, is the ease of installation of Dojo. E-even today, where we do have one command line instruction that you must install or you must initiate. it's, it's a copy and paste job, it's a pretty simple one. But that one script in, installs and configures, you know, everything you need.

Fantastic. So have you had any feedback from the users so far? I, I personally haven't had a chance to test it.

yeah, so, so far so good. We've had, quite a few experienced, and technical users get their hands dirty and start modifying the Docker script, to their own needs. we've seen, in our Telegram group, someone, On how to use Dojo with your own copy of Bitcoin D, because by default, Dojo, like in that one script, like I mentioned, Tor web server, Bitcoin D database, the wallet API server, all of that happens automatically. All of it's made of, of, accessible via a Tor hidden service, so the user doesn't have to worry about networking or anything like that. It starts downloading the blockchain and it begins working right away, you know? So all of that with one command. But some users, especially the more experienced ones, ones, you know, they already have a, Bitcoin full node. So we've had a couple, like I said, experienced users write some tutorials, how to use your own Bitcoin full node, how to, use the Tor layer in Dojo with Basabi Wallet, if you have that on the same device. So there's all sorts of stuff coming, and I suspect more is coming down the line. And I think for the more casual users, they're gonna wait until, hardware. With, with Dojo pre-installed and pre, you know, pre-loaded and pre-configured up to a certain point, because that's, then they don't have to really do anything. It's, it's plug and play.

Fantastic. And can you talk to us a little bit about what you're thinking in terms of pairing? So if you've got your Samourai Wallet on my mobile, how do I pair that back to my Dojo? What's the proposed method?

Oh, yeah, it, it's really simple. So, so once you've, installed Dojo,

Address, Tor onion address, and what you can do is just navigate to that address with, any Tor browser. enter in your, your configured password that you entered. This is you logging into your management screen of Dojo, and this is accessible either on the Dojo device or remotely anywhere. you just have to have a nice strong password. and then the first thing you see when you log into this admin, section is a QR code. And all you need to do is open your Samourai wallet, and scan the QR code, and what-- and it will connect to Dojo. And it won't use our servers anymore. Now, I will recommend that users who wanna use Dojo in the most privacy effective way actually create a new wallet and connect it to Dojo before it ever touches our servers, because if you connect your existing wallet to your own Dojo, that doesn't mean that you're, you know, That we didn't know about your xPub before, right? So we could still derive addresses for it if we wanted to, and, and we could still see what your balance is, and we could still see transaction history on those xPub's even though we're, we're not And that would just waste re-resources on our end. We could do theoretically.

Fantastic

advice. Yeah. So I would recommend creating a new wallet, which you can pair to Dojo before anything is sent out over the net, right? You can also create a wallet offline and then later, connect it to Dojo. There's multiple ways you can do it, but that's just a personal suggestion.

Yeah, no, I think that's a great advice for the listeners out there as well, because it's, it's similar, like if you've used a Trezor, for example. Apple and then connect it to the Trezor web service. Well, now they've got the xPub, so at any point now, any prior transactions or any future transactions on that same xPub, they will know about. So that's just a good, advice there for, listeners who are, just wondering how what's the best, most private way to use this. And, look, let's Samourai Wallet, let's now talk a little bit about the hardware product. So as I understand, you're looking to do a collaboration and get some hardware products

yeah, that's right, that's right. So we were, initially, initially working on a hardware product with, Bitseed, which is just a, a super OG company. You know, they, they kind of created the concept of the at-home, always-on node, and they, they started selling hardware for that really early on. unfortunately, you know, as, as people may have heard, they've decided to shut down operations recently. so we aren't able to provide the hardware node on, on the Bitseed at this time. So that's gonna delay launch of the hardware product, Buy a little bit, it, it, it's not a serious issue, because I'm, I can announce, and I don't think this has been announced anywhere yet, so this is a little very exclusive.

Excellent.

I can announce that we've had really engaging and, successful discussions with the Nodal team. so Keto Miner and those guys, and they've agreed to, do a exclusive Samurai Edition, nodal, which will include, no, well, one, let, let, most importantly, it will be red, which is the most requested, Feature. Very nice. Yeah, you, you should see our Telegram group, you know, there's almost outrage at the prospect of it not being read. but it will, it will, include, enhanced hardware from the stock Dojo, nodal, and, it will come with Dojo pre-installed and Whirlpool as well, which is our mixing. protocol. So it's a, you know, we're sad about, Bitseed, we wish we could have gone further with them, but we are very, very happy and, excited to be working with the Nodal team. And, that will be the official Samurai, Dojo hardware, and that will be the only Samurai Dojo hardware. So we're very happy about that.

Fantastic. I mean, I've got a Nodle myself and I really enjoyed using it. And, listeners, if you're interested, I actually did do an episode earlier with, Askewetao and Kido Minor from the Nodle team, so check that out. but yeah, Samourai Wallet, that's fantastic news. I think

it's actually an important point, for existing Nodle, owners. They're gonna be able to install Dodo for free, via the App Store. Of course, so they're not gonna have to go buy a new node, a node for this. For, anyone, a-a-existing getting a Samurai edition node, like I said, you get enhanced hardware, but you also get some additional, features and, perks that we're gonna announce later on. So there is some incentive besides supporting Samurai and Nodal, there is some incentive to, for purchasing a Samurai edition Nodal. So we're looking forward to- Right,

and you get the red one, right?

Well, most importantly, red is faster. I think that's a scientifically proven, so, you know, that's a benefit in itself. But, I mean, we're-- it's gonna be very nice. It's a premium product, there's no doubt about it. You know, we're talking metal, we're talking laser etched and, and significant specs. So I think a lot of people are gonna like it, and there, there, there may be another, in between, product at, at a lower co-uh, a price point as well, but that's all still being determined. but as soon as existing Nodal users are able to, or as soon as the, the integration, software integration is complete, which is already being worked on at Nodal, existing Nodal users will be able to, Have a very simple installation process for, for Dojo. So that's, that's, that will be coming very soon, that will come before the actual, hardware is ready, I'm sure.

Yeah, that's fantastic, because then if you've got kind of a newbie friend and they've got money and, and their time pool, you can just tell them to get a Notel, and then they can already have, you know, a, a more private version of using Bitcoin, because now they're already using, if they want, the Samourai wallet paired with their Notel, any public servers, like say a public Electrum server and so on. I mean, people are speculating that some of those public Electrum servers are tech-- or theoretically, they're being run by some of these chainalysis companies to try and- Certain,

yeah.

To sort of cluster people's balances and, try to figure out, you know, who is spending what. And now, I guess that ties in nicely to our next topic, which is--

One second, if that was a great point you just made, and I just wanted to expand on it really quickly. Yeah,

sure.

If you have, you, you mentioned the friend who, has some money, but, you know- Wants to, wants to interact privately, but you also may have friends who don't have enough money to purchase a node, but they also want to interact privately. Well, of course, they're able to, install Dodo for free, but they may not be technical. Well, they could minimize trust by connecting to your no-- your dojo, or you know, what-- so you don't have to run your own particular dojo. Maybe you wanna onboard your family and friends away from Samourai servers onto your controlled dojo. This doesn't decrease your privacy It just means that you can derive and track balances of your friends and family who, who connect to it, but there's no security implications for doing so, so you can kind of act as your own small, wallet backend provider, if you understand what I mean, for your family.

Exactly, and I think that's a great point. I think we-- I, I might have even touched on that, listeners, you might have listened in the earlier episode with Thomas Blumer, we talked about this idea of even not necessarily decentralizing out to every single person running their own node, but at least if point where people might have one for the family, or one for amongst your trusted friends. Maybe you've got like a techie friend, and they're the guy who runs the node for your little group of friends. I mean, obviously it's not perfect, but it is superior to the public sort of server model.

Yes. Yeah, exactly. Yeah, I just wanted to make that point because I don't think it's been, well, I, I guess you have touched on it, but it hasn't been, as widely, consumed yet. But it's a, it is a strong point. It is a strong point.

Yeah, and I think that, to, in fairness, it's, you know, it's much, much harder if like everyone who runs a node or every kind of technical person who can run their own dojo for their friends and family, that's a lot harder for, you know, people Difficult than just going to say public Electrum servers or, or running Electrum public servers.

Exactly. Absolutely right.

Alright, so turning now to transaction graph privacy, which is more around things like doing coin joins and so on, we've got Whirlpool. So just for the listeners so they know, I've actually been participating in some of the beta testing of the Whirlpool, which I thought was pretty cool. but Samourai Wallet, I'll just give you an opportunity now to just intro it, tell us what is Whirlpool and what are the benefits from a privacy perspective

so Whirlpool is an implementation of, Zero Link, which is a Chameleon Coin Join protocol. It allows multiple, parties to come together and join their, their coins or UTXOs, in, in one transaction that is beneficial mutually for their privacy and Coincidentally for the fungibility of the network at whole. it's privacy based on pure mathematics. It's not stealth, it's not deception. there's a trade-off to that, being that a, a whirlpool, transaction has a distinctive fingerprint. We have mitigation for that with our post-mix spending tools, which we can touch on in a little bit. those are deception stealth-based, but this is a purely mathematical-based, privacy tool. Let's see, touch points. Whirlpool is, entirely non-custodial of course, meaning the user key, user retains a full control of their private keys at all times. and privacy, the benefits from a privacy perspective really, I think, come to pr- fruition at scale. You know, the more people using CoinJoin for more transactions creates a transaction graph that is more resistant To all sorts of, blockchain analysis and heuristics. When you can't, when you can't determine with any amount of confidence the ownership of inputs to outputs, which is effectively what Whirlpool Does it severs that link of inputs to outputs? And you can't relate, to previously seen transactions. What do you even have as a basis point? Right? You have a system where it isn't trivially easy to peek into the private financial lives of users, and a system where broad assumptions can no longer be packaged up and sold by chain analysis firms and be taken seriously. Because This gets right at the heart of those, breaks those assumptions, and it creates something where Bitcoin is more like physical cash. You don't know or care where the history of your physical bills came from, doesn't matter. This kind of enforces that, yeah?

Right. And I think it might be illustrative now, so during the beta testing, some of the stuff we were doing is we would write, we would see a whirlpool mix go, and then we would go to the website kycp dot org and look at that TX ID. And what it would show is the inputs and the outputs, and maybe you wanna just touch on that samurai wallet and what, what does it look like there? What does it look like visually? Well, I guess more the aspect of how there's not deterministic links. Yeah, I'll tell you, I'll tell you both. Visually,

imagine, you, you know that, that drawer with all your cables in it, you know, all the discarded USB cables and printer cables and Stray, quartered mice and all that, and cables get all tangled up. It, it looks like that visually, and KYC is a visual tool, so it shows inputs and outputs and all the different combinations that Those inputs can be connected to those outputs, and the result, it looks like spaghetti. On a, on a technical level, what you're seeing is every single Whirlpool transaction, every single mix transaction, consists of what's called a hundred percent maximum entropy for a transaction with five inputs and five outputs. That is what a standard Whirlpool transaction is right now. So a hundred percent maximum entropy for a transaction of that composition, five inputs and five outputs, is ten point five four bits. And entropy for, the layman terms is how many possible mappings of inputs to outputs are possible. so that comes down to about, almost fifteen hundred different ways of interpreting the transaction It's, it's fourteen ninety six. additionally, there's zero previously seen transactions in the same mix. Additional to that, there are zero deterministic links between input to output as far as an external, observer is concerned, mathematically the probability of input to output being linked in a whirlpool mix is thirty-four point two two percent each way there's zero address reuse and zero identifiable fee address, within the mix. So these conditions are structural They hold true if we decide to do in the future ten inputs and ten outputs, twenty inputs and twenty outputs. It doesn't matter. the only thing that changes is that with the more inputs and outputs The higher the potential entropy and, the lower the link probability. So it wouldn't be more than ten bits and the link probability would be less than thirty-four. So it just gets better the more you add.

Excellent. So let's talk about the setup now. So I understand, so during the beta testing, we've got the different pool sizes, right? So we had point oh one BTC and point zero five BTC, or one million sats and five million sats. Can you tell us a little bit about the setup there, and then just tell us, go into a little, a bit of the process on using it.

Oh, okay, sure. So like, yeah, like you said, we have, two pools currently. When we launch the full, full release, we'll actually have three pools. You choose the pool you want to mix in based on the total amount you are mixing and the desired, dena-denomination outcome. That's it. You, you pay a, a one-time pool entrance fee. You say, you, you pay the same, flat entrance fee no matter the volume you are mixing. So one Bitcoin costs the same to mix as, you know, a thousand Bitcoins. This has specifically been designed not to be a fee trap. We wanted to make this as open as possible to the widest number of users as possible. if used correctly, all the-- we provide the, the features I just listed above, you know, I just said all that, we provide all that very, very low rate per mix UTXO, 'cause it's a one-time fee. Once you're in the pool, you can mix as long as you want at no additional cost or minor fees. the more mixes your coins are involved in, the greater the overall anonymity set and the lower the overall cost per anonymity set is. So We, we've designed a system, I think, that encourages users to mix and stick around and provide liquidity and help others mix in return for getting free mixes before they actually have to spend. So they, they just are increasing their privacy and providing privacy to others.

Fantastic. So let me just summarize that up again just for the listeners to help make sure everyone's following along. So as I understand it, you've got, when you open up Whirlpool, it's got Whirlpool CLI for desktop, there is a deposit, oh, oh. I,

I think we need to, sorry, sorry, I, I think we need to differentiate between what you're testing right now and, which is the desktop, beta version. And What, what most people are gonna end up using, which is the mobile base mixing. See, Whirlpool has, has been designed from a mobile first perspective from the start, meaning it's designed with a smaller amount of inputs and outputs, five instead of ten, twenty, thirty, whatever, for quicker confirmation, and quicker cycling. And this is to accommodate, you know, the way people use mobile apps and the restrictions on background connectivity on mobile apps. Now, the desktop version. That's designed, for users, who wish to, to enter a mixing pool and remain there for, for longer period of time, continuously mixing their coins. And they can do that all very simply either, through the, through the, GUI app or through the command line app. And, and that basically allows the pool to, to, allows you to provide liquidity to the pool on a twenty-four hour basis, right? So you're constantly remixing your UTXOs. That's long term or, you know, always on connectivity, whereas the mobile mixing is bursty and it's on demand. I need a mix right now, and we'll pull so fast that it's totally possible, it's no problem, you can press the mix button, and it's very likely that your coin will be mixed in the blink of an eye. When there's enough liquidity in the pool. So it's important to, to, discuss each one individually because they're two different, kind of user groups. You don't need to use the desktop app

Alright, so let's talk through a little bit around the structure of what it looks like when the user is actually doing the mix. I mean, it might be slightly different from how I've done it in the testing, but what I've seen is when the user has those UTXOs or specific coins in the deposit window, they would then click TX zero, and that will then do a few things. It will first, one of the things it does is it takes the fee for Samourai, that's where Samourai wallet takes the cut, and then it's now in the premix pool, aspect, that's where it's sort of waiting to get mixed. So can you just outline a little bit of the process and what's the typical flow there for the user? Yeah, sure. So, so that's

exactly correct. I think it's important to explain the TX zero concept, so we have to dive in a little technically there. so as you explained, the TX zero is the setup Of the transaction prior to any mixing taking place. Now, on the desktop app, like you mentioned, you can select one UTXO at a time. that limitation doesn't exist in the mobile version where you can select multiple UTXOs to merge. Into one TX zero. But i-i-i-in any case, when you choose UTXOs to be mixed, they are added to the input side of a TX zero, while the output side is divided into like size amounts based on the pool chosen Where the pool fee is paid, as you mentioned, and where the unmix change is then returned to the quarantined account zero. Or deposit account, as it's on, mentioned on the desktop app. Now, from the TX zero, each like size output, so if you're in the zero zero five pool. That becomes a single input within a five input whirlpool, whirlpool mix. Users, will never mix with themselves in each one of these five input whirlpool mixes, and the same TXO never, directly contributes more than one UTXO. To a mix. So, it, it really, it's hard to kind of visualize, but what it ends up looking like if you do visualize it, and I've, I've put some visual, visualization on, on, Twitter. It looks kind of like a branch, like a tree branch, breaking off and going off into many different segments. And, and each time it branches, it just gets more and more Off you skated away. so, so once each output of that, initial TX0 has been consumed It is considered mixed and it's added to a segregated account we call postmix. So the premix side of things that you see in your desktop client or what we label as premix, In, in actual production use, and when we've tested this, stress tested this on, on testnet, for example, you barely ever see it, the UTXO in that account, because it goes from pre-mix to post-mix so fast. Right. So it goes TX zero to post mix essentially, or at least what it looks like visually to the user, when, when there's enough volume within the system.

Excellent. And so maybe while we're on this point, can you talk to us a little bit about pre and post mix and how should customers manage this and think about this, right? So should the customers be manually managing their UTXOs such that they don't mix, like, let's say later they now want to spend out of that post mix, they've already- Obviously got to be careful not to spend that together with any premix. can you talk to, to us a little bit about that process and whether maybe the wallet helps them not make that mistake?

Oh, absolutely. Yeah, this is, this is such an important point, and I'm glad you brought it up. They shouldn't have to think about it too much at all. I think is the, is the right answer to that. as little, they should have to think about it as little as possible. From the user perspective, all they should need to do is choose one or more UTXOs that they wish to mix and the pool size that they wish to mix it. That's, that's basically it. Once it's mixed and they eventually wanna spend, they can utilize one of the post-mix spending tools that we've built and they can transact their, their mixed coins safely without the, with the least amount of degradation to their Privacy as possible. Every, every spend out of Whirlpool Postmix is at least a Stonewall, but we also have Stonewall times two and Stowaway, which are mini coin joins. I, we can, we can talk about that in a second. Yeah. Yeah. But each, each spend is enforced as at least a stone wall. And what we've seen is that stone walls that come from the post mix Tend to score significantly higher in entropy, than stone walls or originating from the account zero or deposit account, which basically, validates our approach of proposing post mix tools and encouraging people to actually spend. They're, they're mixed coins, because that's really the important part. You need to pollute the graph, and you do that by spending your mixed coins, not just mixing your coins.

Fantastic. And another little point that users might not have initially thought about, but I, I saw that come up from testing, is sometimes once you do that TX zero, you end up with these little bits left over. Do you have a concept around mixing the change?

Yeah, yeah, absolutely. So one having- Multiple pool sizes is really powerful for this, this issue. so if, if we have a, a pool size that can accommodate the unmix change amount Will propose that you automatically mix the change. but structurally, Whirlpool is handled, or sorry, is equipped to handle, unmix change better than other implementations as far as I can tell. As well, yeah, a lot of thought has gone into this, and this is, this, I think, is really where it comes down to shine, and I think Now that your, your listeners hopefully understand the TX zero process, the fact that the change, unmix change Gets sent back from TX0 into Account0, the deposit account, which is segregated completely from the post-mix account, means you can't link the two UTXOs together. The wallet doesn't allow it. So you can safely spend those UTXOs if you don't care, that's not a problem. It's not a serious issue, but you can also do something like marking that change as "Do not spend". Or choosing to merge all those little unmixed change UTXOs into a single new TX zero once enough has accumulated for the smallest size pool. And the pool sizes aren't set, we can open new ones at will, it's easy. It's just about market, desire, you know? So if the market dictates we need a, a small pool to like consolidate dust basically, I'm sure there, then we can easily, implement such a thing.

Fantastic. Alright, so now let's talk about when should users be looking to do a whirlpool mix. So now a couple examples I can think of, one would be before or after doing some kind of cash deal for Bitcoin Because if you're regularly dealing with somebody and they decide to do chain analysis on that TXID, they might figure out, oh, you know, the samurai wallet guy, he's got a lot of bitcoins, right? And then the other one might be potentially using after buying from an exchange. But what's the samurai wallet view there?

Well, both of those, both of those, are absolutely ju- legitimate, use cases for, for using WorldPool or CoinJoin in general. also, mixing, UTXOs with high address reuse, like static donation addresses. You know, there's all sorts of little things, reasons why, but ultimately you should be doing it all the time. The more coin joins the better, and the more spends that pollute the address and transaction graphs, the better. Meaning you should aim to spend UTXOs that have been mixed solely. You shouldn't be looking to spend your unmixed UTXOs. Now, there's no reason to anymore, not with Whirlpool. It's not about having things to hide, right? I think that's super important to get, get across. It's not about having things to hide, it's about protecting your financial privacy. It's about protecting your business's competitiveness in the market, and it's, and it's the overall fungibility of the network, so all the time.

Look, let's now turn, turn to some of the Samourai Wallet features and talk through a little bit of that. Now, one thing I've seen T Dev often say, he often says, "Make every spend a coin join." So can you just articulate for the listeners what's, what's the, what's behind that?

Well, Samourai Wallet, I, I think, is the only mobile wallet, certainly But only potentially wallet to, to allow users to create CoinJoin tran- transactions as part of an actual spend. So this is different to Whirlpool, where mixing And spending are two distinct steps, right? You initiate a mix and then you initiate a spend. we have functionality that allows you to mix as you spend, so coinjoin as you spend. So this is where this is coming from. And then when you, when you think about it, and I keep going back at this, but it's so important. Each coinjoin is a drop of poison in the water supply, of the transaction graph. It's, it, it's, it, it directly attacks those who are trying to build a business model on destroying the fungibility of the Bitcoin token. This impacts everyone who uses Bitcoin. And with every whirlpool, with every stowaway, and with every stone wall, the reliability and the accuracy of their data set is reduced.

So let's talk a little bit about stowaway, what it is and how to use it. Sure.

So stowaway, it's also known as Payjoin, Waxwing implemented it as Payjoin in Join Market, very well. very good implementation. And this is a coinjoin where you can't, you can't actually tell it's a coinjoin. It appears to be, quote-unquote, simple spend. So meaning a, a transaction with two outputs, presumably the destination output and then one being the change back. So this is what a simple spend looks like, and a stowaway replicates this fingerprint of a simple spend, but it's not. It's a coinjoin, and all the analysis platforms, OXT. Wallet Explorer, Blockstream dot info, they all incorrectly identify these transactions as belonging to a single wallet entity, and they're all wrong. And as the operator of OXT, we couldn't be happier about breaking it. That's exactly what we wanna see.

Fantastic. So let's just quickly talk through, if you could just touch on the user flow for that. So, you know, you fire it up in your wallet and then you-- can you just explain that as well?

So right now, it only exists in an experimental capacity within the wallet. It's usable and people are using it regularly, it's just not-- there's no UI surrounding it yet. That's one of the developments that is being tested in QA and is

Is a sort of peer-to-peer method of, of com- composing transactions. So these are really good for in-person, when you and a friend, are together and you wanna compose a transaction together, all you need to do is scan QR codes when you're instructed to do so, and the wallet will instruct you to do so. It's, it, it's a very peer-to-peer mixing method, very cool. Stonewall X, times two is an additional type of transaction in it That's also a two-person coinjoin, and that also works in the same way, although it's a little bit easier, to initiate these types of, the Stonewall X2 transaction remotely, between participants. So we have some more information coming out about that later on. But both, both of these types of transactions, Stonewall, X2, and Stowaway, they make use of two participants, and the idea is it pollutes the, the graph. It's a stealth and deception based privacy. They're either clustered, they're, yeah, they're either clustered by analysis when they're, whether they're one wallet or two wallets, so, you know, the fingerprinting is completely broken. Or they're, they're flagged as potential coin join by, by, Blockstream dot info, wh-whether they're one wallet or two, so the, the fingerprint's broken. So, again, these aren't-- this isn't a slight on any of those services. Those, all those services, and ours included, OXT, are relying on the known and accepted, analysis heuristics and accepted, standards that, like, for example, simple spends where one wallet Controls all the, the, inputs of a simple spend. That's just not true anymore. So attacking that is, is fundamental, and that's why, T-Dev says, "Make every spend a coin join."

Excellent. So I guess I'll just quickly try and summarize that for the listeners and just paraphrase just to make sure everyone's sort of following along. One of the most common heuristics, and there are many heuristics, right? But the most common one is what's known, and I think Chris Belcher calls it the "common input owner heuristic," and Is if a wallet is spending from multiple UTXOs into one or, or wherever, it's assumed that that was one person. And so I think what I would articulate then is Stowaway and Stonewall X2 are sort of, or times two are doing two separate things. One of them, so Stowaway is making it look like-- one of them is making it look like it is, it isn't a coin join when it is, and the other one, if I understand you, is then trying to make it look like a coin join even though it isn't. And in doing so, it's helping break the heuristic on which chain analysis and those companies are relying on. Is that correct?

Yeah. So Stowaway or Page- One is, that's correct, exactly. It, it, it, it, it targets that heuristic and it breaks the assumption that the owner of all the inputs are the same person on a simple spend transaction. Correct. StoneWall, X2 or Times 2, it makes use of two participants in a transaction that follow the exact same rules as a one-person StoneWall. And a one person stone wall has been on the market now for a long time, and a one person stone wall is a false decoy coin join, but mathematically looks like a coin join So now what we've done with, with adding Stonewall X2 in there is basically polluting the fingerprint of Stonewall. So when you find a, a, a transaction that may look like a Stonewall You can no longer say whether it's one person or two person, or, or three person, or four person, or five person. again, it's just about chipping away at the confidence of what it is these, these entities, these chain analysis entities are collecting and, and, making up, on behalf of. Of us, it, it, it's absurd, especially, especially when they're licensing this data a-and handing this data over to active investigations and active law enforcement, proceedings. It's irresponsible. It's not about it being law enforcement, it's about them giving law enforcement who are working on an inv- an active investigation Bad, weak information. It's snake oil, and this will hopefully, the more that people use it, and the more that other services implement these types of tools, the less that's gonna be an issue.

Excellent. And now with the-- there's another feature, so it's called Ricochet. So we touched on this the first time you were on the episode. I think it might be interesting just to clarify that Ricochet itself isn't, it's not meant to be a coin join, right? It's meant to be more like placing distance between- Between a certain UTXO at one point in time and then, say, four steps later or four hops later, w-where it goes to an exchange. And the idea might be that theoretically you might use a ricochet before sending to an exchange, such that the exchange doesn't kind of blacklist or not accept your coins. Could you articulate that?

Yeah, I mean, that's absolutely correct. It, it's, it's essential to understand. Ricochet isn't a privacy tool, it's a deniability tool. That's what it is. so as, as you said, as you Most, most services look back four or five hops. this is a very, very lazy way of doing an analysis, but this is what most do. And if it flags anything in the database, they can reject the transaction or, or, you know, flag it or, or do something. So Ricochet aims to get a-around this This issue and, and thus far has seemed to have been working very successfully for our users, it's a very popular feature.

And, and, we've recently updated this feature, 'cause one of the valid criticisms of, of Rikoché was that there's a very distinctive fingerprint on the blockchain. If you're, if you're looking at the, you know, Anything other than just a dumb analysis jumping back five hops, if you're a human or, or anything like that, you'll-- or, an algorithm that's been properly coded, you'll notice that So that's, that was completely justified, although it wasn't that we were trying to get around that, we were trying to just circumvent these blanket sort of blacklists. but we decided, hey, this is actually a valid, a valid criticism, let's, let's do something about it, and we came up with, ricochet with staggered, through staggered blocks, meaning that you still get the, The, the history associated, the hops of history associated with a ricochet, however, they don't all confirm within the same block or they aren't all sequentially after each other. They will confirm in multiple different blocks at, at different points. and this can take, you know, between like thirty minutes and, and a few hours depending on the mining fee used and, and how things, things work. So it's a little, it's a slightly different use case, you know, you're not gonna use ricochet staggered if you wanna sell. To like Coinbase or something really quickly. But if you wanna move things over and you're not in a time, crunch, it's a great, it's a great, great tool. It doesn't cost any more than a standard RICOchet, so I completely recommend it, and one of the cool things is tying it back to Dojo, if you are running your own Dojo, your, your Dojo will be used as the, The dark mempool where that tr- those transactions, those hops sit, waiting to be broadcast to the network, because we don't let the The transactions sit in the mempool all at the same time, or else they'd be subject to time correlation attacks, even though you staggered them, so they sit out of the mempool in a local Dojo mempool. Waiting for their time to shine, so to speak.

Very nice. So I think that's the key features we're looking to talk about. Let's now talk a bit about documentation and guides for some of these products and services. Have you had any user-created guides or videos, and do-- is that something you encourage? Is that something you're looking for them to do?

Oh, absolutely. That's like one of the things that we could really use the most help on. And we-- like I said earlier in the, in the chat, I think, we've had, we've show into our Telegram group that have just been, just been great, and we encourage anyone who, who, wants to put together a guide, a video tutorial, to put one together. We're, we're, we're trying to figure out ways of highlighting them without taking, you know, responsibility over them. So it's like, do your own research, don't, you know, don't contact us if you screw things up, too bad. But Feel free to tinker, 'cause you can't really screw things up that bad. You know, it is only, it's all public key based, right? So if you, if you really mess things up, you can just start again.

So yeah, no, an-anything that people can contribute would be great. We, we do have some official video guides, but again, we don't have a team dedicated for that, and I'm the person that does them, so I have to find time to do them. I think that, yeah, that about covers it on the, on the documentation. More is better, so please, please help.

Excellent. Alright, and I think my listeners will definitely want me to ask this, so I'm gonna ask it again. when is there an iPhone app coming out?

well, you know, I, I, I- It's not been easy to find an iOS, developer who, who shares the same kind of passion and, and drive that we do about this. It's, it seems to be a little bit more difficult. to find that skill set on, on that platform versus Android. so when, when we're able to, we will, but it's not in the cards anytime soon. I wouldn't hold my breath for iOS anytime soon. We have a lot, a lot to get done. on Android, on desktop, on, on various, various things. So, you know, I, I would like to be on iOS from a product point of view, believe me, but from a develop-development point of view and a financial point of view, it doesn't, it's not in the cards right now.

Understandable, yeah. I mean, I'm an Android guy myself, so it's not an issue for me, but, for those iPhone guys out there, you're gonna have to, you're gonna have to hold on for a bit longer.

Well, I, I will, I will leave, I will, I will leave a little morsel, a tempting morsel. We are working on ways of, bridging Other wallets into Whirlpool, so maybe there could be some sort of iOS app that will allow users of other wallets on iOS, for example, to- Engage in whirlpool, they will have some options available to them, perhaps.

Excellent, yeah, I mean, that, that's the thing, I think mobile mixing is, up until you guys came along, it's, not really been happening. So hopefully, you know, we get a bit of, more people who are able to use that if they would like to. so look, let's, I think that's pretty much it for time. So just let the listeners know, those of them who haven't got Samurai Wallet or if they want more info,

Oh, well, you can visit us on samouraiwallet.com. Following us on Twitter is probably the best way to keep updated on what's going on, 'cause we're, we're often communicating that way. And that's, at samurai wallet, and, you can find our group on Telegram as well, I believe that's samurai wallet as well.

Excellent. Well, we'll put the links in the show notes as well for the listeners. And I think that's pretty much gonna do it for this episode. So thank you, samurai wallet, for joining us.

Well, thank you for having me. It's been great.

I hope you guys enjoyed that discussion with Samurai Wallet, and I hope you are inspired to also go and try out some of this stuff. So try out Dojo, try out Whirlpool mixing, and also if you're getting a lot of value out of this, chances are your friends and family will too, so make sure you share the episode with them, help arm them with the knowledge of how to preserve their Bitcoin privacy, share it around on Reddit, Twitter, Telegram, whatever. Also, just a quick shout out for the people who've left me a really nice review. I'm currently sitting at an Plus 181 ratings globally, so I really appreciate any ratings and reviews you guys can leave me, because that helps new people find me. And you can also find the show notes on my website, stephanlivera dot com. This is episode 78. That's it from me. Thanks guys, and I'll speak to you soon.