Bitcoin OS: Bitcoin Block 853626 Changed Everything For BTC Smart Contracts - Edan Yago. Ep. 576

Transcript

it's kind of insane to try and do computation and data storage onchain so you do computation and data storage on offchain uh you prove it by posting a proof which gets validated verified and executed so make BTC a programmable asset and use the Bitcoin ledger to allow for other assets to be created and used programmatically this sort of concept is new in ethereum land but in many ways is very very old in m coin L we've got a lowlevel language which is Bitcoin script and we need to be able to compile sort of more abstract languages down that uh into into Bitcoin script and the way that we do that is through the medium of ZK proofs and so actually

boss is very agnostic to the specific higher uh level language that you're going to be using if you're looking to stake your crypto with confidence look no further than course one more than 150,000 delegators including institutions like Bido pent capital and Ledger trust corus one with their assets they support over 50 blockchains and are leaders in governance or networks like Cosmos ensuring your stake is responsibly managed thanks to their Advanced me research you can also enjoy the highest staking rewards you can stake directly from your preferred wallet set up a white label note restake your assets on Iona or symbiotic or use the SDK for multi-chain saking in your app learn more at c.1 and start saking

today this episode is proudly brought to you by nosis a collective dedicated to advancing and decentralized future nosis leads Innovation with circles nosis pay and metry reshaping open Banking and money with hashy and nosis VPN they're building a more resilient privacy focused internet if you're looking for an L1 to launch your project nosis chain offers the same development environment as ethereum with lower transaction fees it's supported by over 200,000 validators making nosis chain a reliable incredibly neutral foundation for your applications nosis Dow drives nosis governance where every voice matters

join the nosis community in the nosis Dow Forum today Deploy on the evm compatible nosis chain or secure the network with just one gno and affordable Hardware start your decentralization journey today at nosis doio welcome to epicenter the show which talks about the Technologies projects and people driving decentralization and the global blockchain Revolution I'm Sebastian Kio and today I'm speaking with Yago who is a contributor to bitcoin OS Bitcoin OS is a platform that enables ZK proofs on the Bitcoin blockchains which is really exciting and this enables lots of different things including l2s that are more efficient more scalable more secure and lots of

other exciting applications so in today's conversation we're going to be diving deep into Bitcoin OS how it enables ZK uh proofs on bitcoin and what we can expect from this platform and the ecosystem that is being built upon it Yago thanks for joining me thanks for having me I love epicenter and it's always fun to to be on the show yeah it's a pleasure to have you on so yeah before we get started talk a little bit about your background you've been working in Bitcoin for a while um you know You' worked on Sovereign and other projects so yeah what's um what brought brought you to to bitcoin OS well uh so I I was attracted to bitcoin from pretty much the moment I

heard about it to me it spoke to a a new ability to create property rights that um were self- Sovereign digital and globally available um and that meant that the internet could have own economy that was a massive idea and so I think even before i' finished reading the white paper I was already writing uh a mess email to everyone I knew telling that this was the future and um within a few months I'd been mulling it and go sort of full-time Bitcoin um and so I've been uh working since then to try and make it possible to for as many people

to use Bitcoin um uh as possible and to do so without without having to go through intermediaries uh initially um it started with like relatively limited use cases like remittances I started one of the first remittance companies in the space and um over the years that's evolved around um four and a half years ago I I joined a team building what became the uh largest and probably the first significant defi project in Bitcoin called Sovereign and even as we were doing that we were also exploring how could we go further because um even then we were had to rely on things like

merge Mining and Federated Bridges which only approximate um actually using Bitcoin trustless and we wanted to go the whole way and we had this hunch that it would be possible to do that with some of the emerging uh cryptography we're seeing in particular ZK um we you know uh as opposed to a lot of Bitcoin Maxis especially at the time we were very curious about what was going on in the rest of the crypto space and we thought there was a lot to learn there um and so despite being you know from the Bitcoin space I think I've uh been working in the in the in the modular blockchain world uh longer than most yeah that's cool I I uh I'm I'm

bullish about bringing together modular in Bitcoin it feels like those are two things that are so diametrically opposed but I think both um bring strengths to infrastructure that can really help scale Defi and so I'm really really uh looking forward to this conversation and Diving deeper into that so I mean this today today is actually a pretty interesting day to be recording this I don't know when this go come out but uh but this is November 6 is the day after the US election a lot of polling stations are still uh are still counting votes but uh it is pretty clear now that Donald Trump um has won the election and uh Bitcoin is at all-time high um you know maybe by the time this record

this comes out you know Bitcoin will be at 100K who knows but um yeah what are your thoughts on this new US Administration and what it means for crypto generally well I I think of um the crypto industry H and uh more specifically of blockchains themselves is um Sovereign jurisdictions right they have their own rule set they're not governed uh by any court of law outside of themselves um and they have their own ability to both defend themselves from thirdparty attacks and to enforce their own rules so they're basically jurisdictions so I think of the crypto industry as kind of like Singapore in the sky uh it it's its own jurisdiction except that instead of being in physical

space it is in what is quickly emerging to be a more important space which is the digital space and therefore is globally available now if you start thinking about it through that lens um over the last 16 years we've seen the crypto asset industry you know the crypto space this Singapore in the sky become by far the fastest growing economy in history ever period right from zero to you know $2 trillion uh in 16 years with exponential growth and this entire time that industry has been under significant economic sanctions from the world superpower of

the United States of America so I think the most significant part of this election with respect to our industry right our technology is that Singapore up until now has been under sanction you know Sky Singapore has been sanctioned by the United States we can expect now for most of those sanctions to be lifted and this remarkable growth story that we've had um is sort of had the the the the the roof lifted off of it so um I think we haven't seen anything yet I think we haven't um even begun to see the potential uh uh growth that we could see in this industry its integration into um

the rest of the global economy and what we would call traditional finance and um yeah I'm I'm extremely enthusiastic about it it's basically our country is no longer sanctioned by the United States yeah that's a great way to look at it um I I think that um I think we're in for a really interesting year 2025 I think that the uncertainty that loomed over a lot of us companies building in crypto uh is going to be lifted uh you know namely by the removal of Gary Gensler and uh the uh annihilation of the anti- crypto Army folks who no longer as it appears have much of a voice in Congress or the sen it um and

you know we're based you know we're based in Europe and France here in the UK you know that the regulatory Frameworks here I think are very different but the Wind of Change that's coming to to the US uh crypto front is going to have significant impacts on markets I think like markets will be the first thing that we see react to this and it already has right with Bitcoin now at 74 75,000 and um and and and also you know to other jurisdictions who you may want to follow suit um I'm not super bullish on the European jurisdiction and it's more regulatory um focused approach does that really matter though Europe's kind of like a museum um you know we could kind of keep Europe around to remember what Humanity

was like right I mean what I mean by that is I'm I'm not I'm not I'm not bullish on what that means for European stars in crypto I think like European start STS in crypto will you know uh will have a very hard time to to innovate and that has been the case that's never been really my concern so much I mean many years ago I moved to the UK from the US because at the time you know the US sanctions are making it difficult to build businesses in the space but over time especially as we've seen sort of the creation of you know Dows and um other ways of you know generating revenue and tokenizing projects the um systemic importance of

companies in the traditional sense governed by courts of Law and jurisdictions of sort of the terrestrial terrestrial jurisdictions has significantly reduced and um sort of crypto native businesses Crypton native projects are not don't have a company at all uh or uh are not you know associated with one specific company and so yeah I think there's actually a huge amount of Entrepreneurship not just in Europe but all over the world it is the first truly Global industry in that there is no physical center it's not like San Francisco or London or Shanghai is the center of crypto it's all over the world

um and that's because we are Dennis of of Singapore in the sky uh so I I think that that um that concern is important for those businesses that are dealing a lot with Fiat um and that's an important part um but but there there are sort of uh the merchants who are who are alling trade between the two jurisdictions it's not it's not our native economy um beyond that um I I think that actually if you look at the crypto industry it is the best way to understand what work will look like in the future um the crypto industry was totally ready for uh

Co right because it was already fully remote it was already fully globalized it was already completely unreliant on um the supply chains of the physical world people will frequently be working for more than one project uh sometimes they're able to work a none uh they get paid in crypto there's very few agreements that get signed because everything is done through smart contracts the future isn't evenly distributed but it's here and more and more of our industry is going to start looking at crypto which means that the the the crypto industry itself is going to become sort of our economy yeah I I think that that makes sense from like a longterm perspective I think in the short to medium term

jurisdictions still matter I mean look like the US US dominance like US dollar dominance over stable coins is one indicator that uh Europe is like really lagging behind and I think that like the use of us dominated stable coins is one of the one of the reasons why like one of the indicators that um that that that Europe is going to lack behind in it its dominance over crypto and and then the other the other is purely just the the um you know if like Mika for instance uh you know if we look at Mika it's m it makes it very difficult for for European startups to set up here and become compliant just because of the high cost and so it's going to favor and already is favoring

large organizations large institutions like the likes of binance Etc to set up shop here because they have the ability and the compliance teams and the capital to comply with uh compliance but you know if you're if you're a startup and you want to comply with MAA and like offer your services here in Europe in a compliant way um that's going to be increasingly difficult now we'll see like what the regulatory framework looks like in the US but for the moment as far as I know there is no sandbox right in Europe for um startups to ease into compliance it's like zero or nothing sure I I I I don't think we're disagreeing I I I agree that this is not

good for the jurisdiction that is Europe or the EU but I don't think um that you can identify the jurisdiction with the people right um there's there's nothing stopping Europeans from being involved in this industry and many many of them are uh they hold the assets they are involved in you know developing the projects um so I just think uh you're right that we're not going to see like overnight The Disappearance of the jurisdictions we don't need to uh there is more a more viable alternative economy and viable alternative methods of Commerce which people around the world are able to use it I agree with 100% it's sad that you know Europeans

have to deal with all these Capital controls um but um it hurts Europe more than it hurts Europeans yeah well uh it's GNA be an interesting next couple years for sure and uh I'm I'm really uh I mean the thing that I'm most excited about is just like Vol builing in the markets in like in the next you know weeks months and years and you know volatility is typically when you know there is the most money to be made so you know everybody should be should be exposed right now not investment advice but uh being exposed is probably good but good life advice good good life advice yes so uh not in that's advice but life invol um cool so let's um let let's take

a step back and and talk about Bitcoin or or boss actually you know something I think now now now that I'm thinking about I think we actually met in person in in Denver last last year very briefly at the Bitcoin re Renaissance event uh I came up to your booth and and said hi but um but yeah so what is what what is bitcoin unest and what does that enable fundamentally so fundamentally what we're looking to do is to make it possible to use Bitcoin as a general purpose uh Ledger with um unlimited programmability so make BTC a programmable asset and use the Bitcoin ledger to allow for other assets to be created and used programmatically or um

you know uh in sort of more colloquial speak turn Bitcoin into a smart contract uh layer uh smart contract chain um and the way we do this is uh where're is basically um taking the the the Insight that modularity proposes which is that it's kind of insane to try and do computation and data storage on chain so you do computation and data storage on offchain uh you prove it to the the the the chain or what I prefer to call The Ledger by posting a proof which it's

validated verified and executed and that execution allows you to issue new assets um introduce you know uh qualifiers encumbrances or covenants you know basically say how those assets can be used and um to uh move assets from uh own from you know from the ownership of one entity to another yeah this sort of concept is new in ethereum land but in many ways is very very old in Bitcoin land um Bitcoin has been designed as a extremely limited system in comparison to most of the U sort of out chains that we've seen in that really it specializes

in being a ledger only um whereas mostly due to the influence of ethereum other chains have sought to sort of add into the chain um smart contract you know execution a VM uh a data availability basically everything plus the kitchen sink right Bitcoin is the original lazy Ledger that's right B for the modular world and and is sort of like the perfect base layer to act as a ledger it's extremely reliable you know it's permare it's not like software that keeps upgrading it's it's like um it's co-base is small enough that human beings can understand it which is very

different from um you ethereum sort of being like classic example of something which no now there's not a single person in the world who understands its full code base and it's relatively lightweight also as a result um and so it's the most trusted most secure uh system and for years uh there was this debate between bitcoiners and ethereum which effectively was like the early Innings of the modular debate where bitcoiners were saying look guys you're going to be giving up uh you're got to be you know you're putting you're shoving too much into a chain you're going to to be giving up on decentralized and you're going to find that the system doesn't scale this way and um you know uh La a few years ago it became very very obvious that ethereum

wasn't scaling transaction fees were becoming too high and now um depending on the DAT you know you'll see more than 95% of the um transactional activity on ethereum occurring offchain primarily in what we today call rollups um so I think in that respect Bitcoin was designed in a manner which foresaw where we would ultimately have to go and has been um sort of like turtle in the race slow and steady moving uh towards a very very clear North Star which everyone is galvanizing around you really think this that like Bitcoin was designed in in this way like to to figure out where it had to go and

it's not just like a happy coincidence that you know there are really think that in 2014 like bitcoiners were thinking yeah we're going to have like l2s and modular blockchains on top of Bitcoin right now uh yeah and I I mean definitely so actually it's interesting that you say 2014 2014 is when the uh side chain uh white paper came out for Bitcoin um so that was very very explicitly how bitcoiners were thinking about uh expanding it and then later in 2016 2017 when there was the block size Wars right it was the group of people who didn't believe in that Vision who forked themselves off they said look we need to have much bigger blocks we need to introduce you know more things uh and

have more frequent uh uh Forks so that we can upgrade Bitcoin and the majority of the Bitcoin community and in particular the Bitcoin developer Community rejected that idea very very explicitly with the idea that no um that's not how any system ever has scaled yeah that's great great great point um I mean th those those Bitcoin scaling uh debates were yeah I mean it was it was it was a a really interesting time I at the time felt that Bitcoin needed to increase its block size in order to enable more transactions I I didn't see Bitcoin as a way to do smart contracts though I felt like Bitcoin needed to

stay as a very simple sort of payment system that other systems would would fill the role of smart contracts and like up until now that has been that has proven to be true right like other systems have filled that role ethereum salana um and all the other kind like you know modular chains app chains that have come um so I guess I guess there's still time to be proven wrong on that uh you know yeah well I think if you've come into Bitcoin and like let's say the last five years uh you would be forgiven I came in 2013 yeah oh so they you go so I think you'd be forgiven for believing that bitcoiners didn't believe in smart contracts because the bitcoiners who

have sort of come in over the last five years don't and the reason they don't I think can be attributed to Stockholm syndrome right so Bitcoin didn't have Smart contracts um they were held hostage in their own minds by the fact that Bitcoin didn't have Smart contracts and so they uh convinced themselves therefore that if it doesn't exist in Bitcoin it must be it must be unimportant and so instead of saying well okay we we're working from first principles on how best to introduce smart contracts to bitco and they they just rejected the idea out of hand as sort of throwing the baby out with the boor if ethereum has it it must be bad um and that's how you ended up with the ultra Maxi uh uh Creo I like to

call it bag bag bias yeah maybe not alra um yeah no but I mean there were some like really early uh applications on bitcoin that I thought were really cool I mean like we at epicenter you know we were using um we were part of the let's talk Bitcoin Network and we were using a counterparty to do like tokens that our listeners would get access to and like this was all built on on this kind of you know early version of a Bitcoin L2 it didn't have Smart contracts but uh you know these were kind of early ideas of what then became you know very common uh in in terms of tokenizing uh using using blockchain to create other tokens than um than the underlying store value

um so yeah these these ideas have definitely like got taken whole well I mean one one interesting thing which people don't know most people don't know is that um this sort of uh idea that you will have the Ledger and also applications was there at the very very Genesis of Bitcoin in um satoshi's Bitcoin um version 0.1.0 uh there were the beginnings of the first uh de it was a poker de designed to allow anyone to play poker over Bitcoin it was called poker Lobby um and was later remove because he felt like uh you know you can't just shove these things into the chain if you want them to work and then in 2011 Bitcoin invented the first

Ico uh with mastercoin which was a system designed to allow for smart contracts on bitcoin through a meta protocol so um in a way um you know uh all it's sort of like you know people will say that all of Western philosophy is a footnote to uh to Plato uh in a way all of the development that we've seen in crypto is sort of like a fitn note to those first uh you know four or five years of of a Cambrian Innovation and explosion that occurred in Bitcoin and we've just been playing with the same themes ever since so let's talk about the this the ZK proof so um Bitcoin OS uh verified the first ZK proof on bitcoin in in

block number 853 626 proudly on your website a block of historic importance the block of historic importance um how does this work so you know for like let's let's break this down for people who understand Bitcoin at at a fundamental level you know how do we use Bitcoin to verify szk proof and what are the different pieces of technology that enable that so um yeah it's it's very different from how you would do it on a different chain right so um in a different chain like with ethereum you have sort of um a easy touring complete system you

basically write a a verifier into that code uh with Bitcoin it's much more complicated obviously you've got limited data Avail you know limited data available to you you got 4 megabytes per block you've got a thousand stack limit you've got um an extreme limited scripting language and so what we had to do is we had to write from scratch a ZK verifier using Bitcoin script and when you do that you're among other things writing a ZK verifier without even the ability to use multiplication so the script size becomes huge and then the next challenge becomes how do you get that into a Bitcoin transaction and so obviously you can't and so you need to

uh Beyond standard optimization you also need to to chunk it up and so there um um introduction of Tap Root into PR which allows you to create these very complex trees of uh uh of transactional outcomes allowed us to uh effectively split up the script um and its potential outcomes um as binary outcomes in a large tapy tree so we split it up into the leaves and then um the Bitcoin miners aren't able to directly verify ZK proofs and so you need to um construct some kind of mechanism where external verification

can be proven unchain to the miners um and so right now uh the way we're doing that is with like a um a challenge response game we we bifurcate the so we set up a series of pre-commit and then uh we bifurcate the the the the the script outcomes until we force someone who's cheating to basically reveal their hand to to show that they're contradicting themselves um so this is a yeah there were a lot of uh many Innovations optimizations and and sort of breakthroughs along the way to achieve this there was a paper that came

out called meriz all things which um described splitting scripts up into these into these C trees and and writing them in tap script there was a paper called BVM which described uh utilizing this to write uh code of arbitrary complexity uh there was the work that we published in bitstar and Grail uh which described how we can write a ZK verifier in this and then there was the um uh very significant optimization work that is ongoing to uh to make this not just fit but it be so cheap on coin that it's competitive with verification on ethereum or even cheaper um and we

haven't we're not done yet right so there there there keeps some now that sort of the the ball has gotten rolling uh the momentum keeps building uh and and and new methodologies which uh improve the speed and some of the security assumptions with which you can do these things uh keep on getting published there's work that um the boss uh development team and its Community uh uh is doing um which which is remarkable I mean every every month or so sort of a new startling idea uh or sometimes even a significant breakthrough is made um and so sort of the the the limits of what you can do with Bitcoin have

effectively dissolved away almost entirely so um with Bitcoin OS with boss our goal is an operating system for Bitcoin that allows you to take any arbitrary code of any size prove it uh to bitcoin as a ZK proof and then um verify and execute it on Shain and once you do that you've effectively got a highly efficient Turing complete system which can handle any code and um and then you know sort of the question that has been one of the most fundamental questions in the entire crypto space which is what bit coin KN do goes away because Bitcoin can do everything okay I

I want to I want to just like dive into this a little bit so um so the issue is that Bitcoin doesn't have the right U um it doesn't have the necessary op codes to produce uh a ZK proof because it doesn't have multiplications and so that makes it impossible to do on chain it wouldn't produce a ZK proof that's true um somebody else needs to produce a ZK proof I think that's true of all systems uh sorry to verify a ZK proof yeah it it also doesn't directly verify a ZK proof um and so what you need to be able to do is to create a a scenario where um you have other parties who can verify the ZK

proof and if the proof is incorrect they can um they can force a transaction on chain which invalidates the proof and so that's that that's what I was describing with the the bifurcation game and and and I think within a few months we'll be beyond the bifurcation game and we'll have basically one shot verification and so let let's maybe also just kind of take a take a tangent here and talk about tap rout and so what what tap rout enables for Bitcoin you know that wasn't possible soort of pre-t rout and um and how how does tap r work exactly uh to enable you know this this entire new ecosystem of Bitcoin

HTO so tap had a lot of implications and it was a a pretty um chunky uh upgrade to Bitcoin in terms of it it was you know relatively relatively narrow in what it allowed sort of it init from from a you know just like um surface perspective but what that did is it opened up Avenues which have given us among other things ordinals and runes and BRC 20s and ZK verification and Bitcoin and um Etc so why did uh how did tap do this first of all what Tapo did

is it introduced the ability to it introduced new cryptography into Bitcoin especially around or specifically around um uh the ability to sign to generate and sign transaction so that you could generate uh a tree of conditional transactions right uh and this had all sorts of sort of obvious implementations like you could create a multisig where the signers were not known or you could create a uh conditional transaction schemes um which were hidden until they were actually

performed and a big part of the motivation there actually was to try and improve lightning Network um by allowing sort of all kinds of conditional payments which would impact um liquidity transitions within lightning Network um but once you get this tree of um you know of arbitrary complexity where you have you know different conditional paths that you can you can walk down well that has massively opened up the type of computational complexity that you can introduce into Bitcoin and so what's what happened was that when Tapo

launched in 2020 2021 there was a lot of excitement and then literally nothing happened like it wasn't used for anything significant right there were a bunch of experiments was pretty quiet until the beginning of 2023 when um Casey introduced ordinals and that was sort of like first it was like the simplest use case but it was the first use case that really really took off and what we've been the dividends that we've been seeing since then in Bitcoin um have to a great extent been from the fact that um the level of sophistication and understanding of how to manipulate and utilize tap transactions has just exploded right what have we learned from from oral specifically that you

helps create a path forward for bites um I don't know that I could necessarily draw a strict line between ordinals and sort of what we're doing although we do utilize inscriptions so we're utilizing to to to inscribe data um I think one of the things that it did is it sort of introduced this idea of being able to inscribe um very large pieces of data into Bitcoin if before the operator which is where you would put usually put arbitrary data uh was quite limited suddenly the space that you had available to you was massively increased as it turns out we actually uh to you

know have optimized things so that even sort of the the the limitations that we had from a data perspective uh could have been respected uh even without tap rout but it it its primary benefit was getting um eyes on the problem and sort of opening up sort of like you know uh once the first person ran the I don't know 8 minute mile or whatever it was suddenly everyone could um there's there's something about um just demonstrating that something is possible that makes it possible for others there's another part of so we have we have the bit snark which allows for ZK uh proof verification and then there there's two other components to

bitcoin OS which is Grail and Merkel mesh I'd love for you to also explain what what these uh two pieces of tech uh do and and how they enable better l2s for Bitcoin sure so a boss is an operating system um and like any operating system it's designed to um allow you to have different types of computation which you can coordinate so you could have different um external comput computational environments let's say two different rollups which a boss will coordinate between them and um and then it will also coordinate that with the CPU which in this case is um Bitcoin main it right and so to make that

operating system as useful as possible you need to bundle in some core use cases so one core use case is the ability to um lock up uh BTC and other Bitcoin assets and then allow them to be manipulated in external uh environments so other chains rollups deps what have you so that is what Grail is designed to do and it does it first of all for assets and then secondarily for messaging arbitrary data and perhaps most importantly for security so if you're building a rollup on bitcoin it is through Grail that you can sort of

write your state to bitcoin and then use that um as the transaction ordering tool for your rollup so that your rollup has the same or very nearly the same depending on your design decisions uh security assumptions is Bitcoin Manet and and is secured by Bitcoin proof of work right so that's that's how you expand uh Bitcoin both from a scaling perspective and a features or sort of you know uh expressiveness perspective uh with making few or no sacrifices and then the next big challenge is you if you're doing that you want to avoid what has happened to ethereum which is uh each of these

different execution environments these different rollups is its own whole new chain with a whole new world and you lose the interoperability the fungibility the composability you lose access to the users the developers and the whole thing kind of becomes a mess um and so what you want to be able to do is you want to maintain that composability and so that's what merro mesh is designed to do um and you know these are things that we're still you know they are all in different um stages of development but the idea is uh with Bitcoin OS you have a single chain experience right so uh a user is on on on on in one execution environment

let's say it's a uh an environment which is um designed to you know Shield their transactions and provide um data and information security for them and privacy of their transactions can interact with uh an evm which is focused on Defi and a a utxo based system which is focused on um Dows and within a single transaction interact with both of these things as a shielded transaction which will uh get aggregated and um ultimately settled on bitcoin main it okay got it so we have we have the ZK proving aspect we have the bridging and then we also have the interoperability

and composability as one cohesive system which is Bitcoin os are there any other features that we're missing here like is there an SDK that people can use to build their applications using Bitcoin OS not yet we expect that there will be um and there's going to be other components um not everything will be developed sort of by the the boss developer ecosystem some of the things like um data availability which is going to be really important uh you will be able to bring in other tools like Celestia or nubit which is like kind of like a DA layer specifically designed for Bitcoin or Babylon are introducing the idea of staking and so um you know as an

OS probably there'll be a set of core components that get bundled together um and then you'll probably also just be able to sort of pick and choose from a large number of other um tools Dev tools that you'd want to to to use to make boss as usable and and and as valuable to you as possible okay so so effectively what what boss enables or what it allows it it it allows l2s to use Bitcoin for security um they still will you know can utilize should utilize some data available earlier like Celestia or Nuit or Avail um now there there is one missing component here which is

sequencing um what's the preferred or kind of uh recommended way that boss yeah recommends for for sequencing so on the basic level boss is agnostic to the specific sequencing methodology where sequencing does become sort of where bus becomes more opinionated with regards to sequencing is when you want to have the highest degree of composability and there um uh there's uh sort of this concept of shared sequencers which we're skeptical of because getting everyone to use the same set of shared sequencers is that sounds

like the kind of thing that you can do in a centralized environment but not in a decentralized environment and so the way we're looking at this problem is to um be able to provide sort of an inter sequencer data feed so that sequences who want to be composable with each other will have access to uh a feed of transactions that are relevant to them so let's say you've got um and by the way I I tend to not use the term L2 because it has almost lost all meeting um so I I I use the more general term sort of external uh Computing environment or external environment um so you have these external execution environments and I want to perform an a transaction which is going to call on

another uh external environment right so I want to have a system which is available uh where I can basically ping that other system so rather than trying to force all of the sing sequencers to basically view everything we're trying to pair down the problem so that uh you the sequ can message amongst themselves here I have a transaction which is going to involve you uh and and and you need to ultimately sequence it okay got it um so another question I want to ask is you guys are partnered with a team uh called Merlin chain uh which is an evm external sequence

external execution environment as as you put it they they they would describe themselves and what they are looking to become is a Bitcoin rollup right and so they've generated quite a lot of enthusiasm they've got quite a lot of tvl just on the basis of the fact that they're going to be able to be an VM roll up to bitcoin and there has actually remarkably quite a lot of competitors with significant size already uh who who are doing this so so I mean um Merlin chain is is an evm based rollup and certainly there are a lot of other evm based rollups that are uh launching on ethereum there's also bit VM which I think has its own programming language although I'm not entirely sure maybe we can clear that up

here but you know if we take a step back here do you think that so my my view is that the evm longterm is going to lose market share to other more modern VMS that are abstracted uh where sort of security and complexity is extracted away from the developer um that is U more performant doesn't have some of the Legacy bugs that EDM has like like re-entrancy Etc um and and that is more modern and tuned for modular blockchains and the analogy I I like to draw here is how you the early development languages of web

like PHP and ASP has have mostly given way to more modern languages and Frameworks like node.js uh with the Advent of mobile and and the modularization of the web two stack with Bitcoin you know now now that Bitcoin has sort of leapfrogged the entire sort of you know defi uh period of the last couple years um isn't there an opportunity here for Bitcoin to adopt very modern VMS as the kind of Flagship l2s on bitcoin VMS that are wasm based like the slot of VM like move and attract new new uh waves of developers that are coming from say like

Emerging Markets uh that are looking to learn the next gen eration of of blockchain languages that will be you know used in the next 10 20 years yeah what what where do you say here on this uh on this issue yeah so if so I think the way to think about boss and the boss stack is we have a low-level language that we need to sort of compile um that this is an analogy but it's a pretty close analogy we've got a lowlevel language which is Bitcoin script and we need to be able to compile u a bunch of different uh Lang languages sort of more abstract languages down that uh into into Bon script and the way that we do that is through uh the medium

of ZK uh proofs right so basically any language any language can which can be proven as a ZK proof and and and now current iteration and probably you know for the foreseeable future we're talking about growth 16 snarks if you can turn your code into a Groth 16 snark then um boss can read it and so actually boss is very agnostic to the specific higher uh level language that you're going to be using now with regards to evm I mostly agree with you and in fact I would go even further than you right so I think the reason evm has been so popular is an artifact of the way that ethereum was

constructed so etherum hardcoded its VM into the system and then solidity became the most popular sort of language for but basically everyone is forced to use evm and then the way that um other chains have developed is well they've just forked that and so they've they've taken all of that with them and that's true for other l1s and it's also true for rups 2 uh ethereum now we are I think rapidly uh moving into a world where almost everything that we know and sort of assume around our industry is

wrong and sort of the best example of this is we call ourselves the blockchain industry right but that is just a symptom of us not understanding what we're actually doing nobody wants a blockchain a blockchains a sort of a stumbling block towards getting what we want it's this really annoying slow non-performance database um what we actually are is we're a property rights industry we're a a digital crypto asset industry and it turns out that you don't need most of what you would have in a blockchain to generate that at all so uh two examples of uh companies that are RAR I think at the bleeding edge of this is um uh risk zero and succinct and both

of them have developed more general purpose ZK VMS right and so these are VMS which allow you to take uh rust and then you know typescript wasm whatever compile that down to directly uh to ZK Pro and so what that means is that we're actually not going to have um sort of chain specific or blockchain specific languages we're going to see this year and certainly in the Years following the developers being able to choose whatever their favorite language is and then um compile that down and it also means that this idea of you need to have your

own L1 or you need to be a chain at all is going to look very [Music] an execution environment which is highly optimized to your particular use case and then you have um a whole assortment of um Builders and and sequencers who are sequencing and providing interoperability and composability

between these different execution environments and so at that point you've completely unbundled the blockchain why would you even want a blockchain it's it's it's it's sort of getting in the way of everything that you want to do it's constraining you it's it's heavy it's expensive um a and so I I think we're actually at the early Innings of an entirely new phase the blockchain industry is dead the crypto asset industry is about to take off and this whole idea of um layer ones is is going to disappear the and so our this prism

through which we've been looking at our industry right that it's a blockchain industry is wrong and projects are going to have to either choose to adapt to this new environment which is I sometimes call the Post Chade environment or I think they're going to wither yeah I think um I was watching a talk from yeah I think it was Murad you know this this this meme coin guy uh I was watching his talk from 20 from token 2049 and and he says basically like you know what what what the what this industry does is produce this tokens and uh and that the technology really doesn't matter and in the same way that like if you look back at in the last 20 years internet uh and web development or

the industry developing like what what we produce is like we produce services and software that um that improves people's lives we didn't produce like you know database Technologies or uh you know we don't look at it as like you know the the database um like connected database uh industry or you know the kind of like Cloud industry we look at it as the software industry or the services industry or all the different like food Tech Medtech fintech industries that were produced there and um and and I think that that's like an apt analogy for crypto and thinking about it from like the end product which is you know tokens and applications that

allow people to utilize those tokens makes a lot more sense than looking at it from from the underlying technology um uh perspective that's I think a symptom of the industry being very early which is something I believe in real adamantly like I think we are much much earlier than people think we are um or people think generally I think uh we are um you know we're somewhere still in the uh 90s early 2000s era of the internet where nothing works building applications is a mess there are like tons of different ways you can do things I mean I was a web developer in the late 2010 and I mean was a web developer since since my teens and you know remember what it was like building a

website 15 years ago just 15 years ago um building website was just so incredibly complicated you had to write CSS for different for different versions of of your the same browser you had to build different applications for depending on the mo on the type of device you were on um nothing was Secure there was no https everything was nothing was Private uh deployments were slow you had these like very unsecured kind of languages like PHP and MySQL um and and that all Chang in the last 15 years Al so you know think of think of that in terms of blockchain years we haven't even scratched the surface we haven't scratched service and this was 20 years after the first website right like yeah so uh we have

not scratched the service and I really believe that we're much earlier than we collectively think we are um you know think looking back at ethereum uh br bring it back to ethereum and you know ethereum I think has somewhat suffered from its uh rollup Centric road map with cannibalization of the l1's business model um and you know we we've seen these charts right of Bas generating millions of dollars in Revenue but yet only paying several thousands of dollars of fees to ethereum how does Bitcoin avoid this and like is is Bitcoin fundamentally different from the fact that it's of work and um that's just a different animal than than ethereum or or are

there really like lessons to be larage here where Bitcoin needs to do things differently in its L2 strategy well first of all Bitcoin is fundamentally different in many very significant ways um first of all um Bitcoin the chain doesn't have uh an asset uh in this same way that ethereum the chain has anth right so the entire ethereum chain has been built around eth it's the method of consensus you need to stake it it's highly dependent on revenues um and and sort of it's extremely over

engineered um BTC is a simple commodity and um and so uh I think I think ethereum is phenomenal it's been um you know an absolute Treasure Trove of experimentation and Innovations but at the same time it's being sort of running around like a headless chicken for exactly the same reason it doesn't know the ethereum is not built from first principles it it it it sort of is in a constant race to run after the last narrative right so um smart contracts when you couldn't do smart contracts on

on bitcoin proof of stake because Bitcoin with proof of work modularity because we needed to solve the technical debt that we created with those first two decisions um ultrasound money because we need to compete with BTC and and so e the is is fantastic but it's not built from first principles um BTC is a product in and of itself that's why it's called digital gold it's um extremely simple to understand uh and and that's what makes it so popular and so Bitcoin is not riant on BTC in the same way that eth is Reliant um what BTC is it's a first class citizen in The Ledger right it is

like the first example and the best example of an asset secured by the world's best Ledger another way in which Bitcoin is very different from ethereum is it has um what you could call second mover Advantage right so um this despite what people think it's not really important who's first it's important who's last and so one of the advantages that we have when building bosses we get to look at ethereum we get to look at other systems and um recognize some of the pitfalls so we're building in composability and interoperability as a first class citizen um and then the the the uh third sort of

conceptual problem uh is it ethereum itself is very dense right it's it's it's got so much in it um and the rollups that have been built for ethereum um partly as a shortcut have just basically replicated that chain uh and so they're not built as execution environments they're built as sort of Alternate l1s which just happen to have you know an optimistic or a ZK bridge to ethereum and so in many ways actually their relationship with ethereum is is possibly less than what you ideally would want for ethereum although it's great for the for the

rollups themselves um and I I I think that's going to change both for ethereum and for Bitcoin um but for Bitcoin um it might actually happen sooner partly because of the Simplicity of Bitcoin where uh we will start seeing sort of um highly optimized nonm right we we we don't have the baggage of the evm that everything needs to be built for evm and so you're you're likely to see sort of rust and and and wasm and typescript experimentation on bitcoin perhaps even um more aggressively than you would see it on ethereum that that I'm not sure about um yeah yeah that that I'm very hopeful for um I'm I'm uh I'm very much a proponent

of you know building new environments with which developers can you know interact build applications in a much more efficient scalable and secure way and I think we get there by sort of investing and believing in like R based VMS wasm based VMS um move based VMS more so than the evm which you know is 10 years old uh in in a few months and uh um and just wasn't wasn't built for I think the future of a blockchains even though I think it will continue to be relevant you know in the same way that PHP continues to be relevant you know it still Powers something like 70% of the

websites um but it's not the thing that college kids are going to be learning and getting excited about in the next 10 years um yeah before we wrap up here I want also talk about cardano which is interesting because you guys are uh working with cardano to bring um uh cardano liquidity to to bitcoin uh or maybe the Bitcoin liquidity to cardano sorry um so yeah what's what's happening there so I think the big story is that from bitcoin's perspective everything is external execution environment right and um if you can hook into these systems and extend Bitcoin into these systems uh they become scaling tools they become uh

um basically layer twos to bitcoin and um cardano is quite unique in that cardano um yeah has a lot of sort of philosophical agreements with Bitcoin but from a technical perspective it has one which is particularly important which it is which is that it's utxo based and so to um do address and transaction mapping um as well as transaction finality between uh Bitcoin and cardano actually turns out to be relatively easier right it can be done with an evm it can be done with any chain but cardana have at least in the early Innings a important advantage and so the cardano community and cardano developer

community in particular saw that um we had verified ZK on bitcoin and they reached out to us and as they dived deeper there was this growing sense of excitement um which culminated in um one of the the weirdest things that have ever happened to me which is I went I gave a talk at at a cardano uh uh conference which that in and of itself was an extremely unexpected outcome for me um but um but then also the reaction right I I I I I was just you know it was just another one of many panels that I've given at a conference but suddenly uh sort of the the crystallization it

sort of cardano realized uh a lot of what we just discussed over the course of this call right that the the whole crypto space is sort of inverting that you can utilize Bitcoin as this sort of global canonical uh Ledger that doesn't mean that you're dead in the water instead of fighting that you can actually uh utilize that um you can gain access to you know a multi-trillion dollar uh uh asset base hundreds of millions of users you can provide data and compute that Bitcoin itself is never going to do for itself you can do it trustless um and so I think cardano is turning out to be just one you know we discussed Merlin and B squared and and there's a whole bunch of

other projects that haven't made public announcements that are sort of also integrating boss but uh cardano so far are the biggest sort of project and community that have gone public with the fact that they are um sort of pivoting or starting to see themselves as an ideal platform to provide asset management and smart contracts to bitcoin um I I think that this is going to be thematically one of the most important things over the course of 2025 and Beyond right the this idea that we've had in our heads for the last 13 years which is that you've got Bitcoin and then you've got all of the

competitors to bitcoin like I don't yeah I I don't agree with a lot of the the what I call you know Ultra Maxi stuff but Michael sailor has this thing where he says there is no second best and in one very deep respect he is correct um there is no other platform there is no other Ledger out there that is going to prove to be the credibly neutral uh globally spanning Ledger that all of these other chains and projects can plug into right everyone else is sort of a threat to themselves Bitcoin competes with nothing and so this idea that you're competing with Bitcoin I think has been dead in the water for seven years uh the

the the high water mark of it was 2017 where sort of there was the ethereum flippening um since then e in ter in BTC terms has fallen more than 80% um pretty consistent monotonic decline um the flippening is never happening Bitcoin is a fact it remains as much as ever the center of gravity of this entire industry and so the game has changed it's now the technology for the first time through boss is also available where you can integrate with Bitcoin and and and and and provide services to that asset base uh and not only that but utilize Bitcoin as a ledger for many assets Beyond uh uh BTC is cardono the place where it's going to

happen though I mean like cardono is is in in the top market cap assets by virtue of having been early and it it's very liquid on on Sexes but the cardono defi ecosystem and like the Cardon ecosystem generally is not that exciting I think to a lot of people um you know tvl is like two or 2 and three million I just checked you know like the excitement around things like salana um you know even even Cosmos I think you know as um as a place for defi Innovation powered by Bitcoin liquidity feels more credible to me than than cardano I

mean well um you know the internet is sort of like this one globally spanning Network that we all use and on top of the internet um over the last let's called a 20 to 15 years a number of companies have launched which have grown to multi-trillion Dollar M market caps right so many have you know hundreds of billions in dollars in market cap but there's several that have trillions in market cap um if you roll the tape forward with Bitcoin Bitcoin if even if it continues at a sort of 50% of its current trajectory is going to be somewhere between 20 and $40 trillion in asset value uh 12 years from now there's going

to be several companies or more likely protocols that are going to have trillion dollar valuations uh building for that ecosystem now the question is who is it going to be I think some of the winners are already out there cardano might be one of them and cardano could have a very very significant trajectory change if uh they end up um you know becoming a leader in providing a really great ux experience and really secure uh uh smart contract experience for Bitcoin other projects are taking a different approach and they're sort of more tightly coupling uh themselves to bitcoin they're basically becoming rollups and

uh not uh you know they don't have their own consensus mechanism at all uh I don't know if it's going to be you know if cardano is going to be uh the project that wins here uh and I definitely don't think there's only going to be one winner right so you could have cardano being one of 10 very very significant projects 10 years from now that's really a question of execution um but what we are definitely seeing is more and more projects are starting to recognize that this is not just a viable path but the most viable path uh towards positioning yourself for 2025 and also 2035 um and so if it was just one or two projects it was just cardano and just

merland you know I would say okay that's just a straight line but it's enough significant projects and many many many smaller sort of innovative projects that at this point um it's it's a it's a trim cool so what's um what's on the road map for Bitcoin OS and how can people stay up to date with a project and what is your uh what is your call action to our audience okay well um you know the the the first versions of the ZK primitive um are already on beain and we're now in the process of integrating different pieces of the OS to launch uh sort of V1 of the production level OS which is

going to make it easy for developers to start using these different Primitives um and we expect to roll that out over the next that's quote four or five months so where things will get particularly interesting is the beginning of uh next year uh in terms of following us that's pretty easy you can follow me on Twitter I'm idago you can follow Bitcoin OS which is BTC o um and there's a whole bunch of other projects among name cardano and Merlin that you can follow as well to to check their prog in terms of C to action look your audience I think is particularly Tech savy uh you guys have a lot of

developers who listen to you I think there's just a huge blue ocean opportunity Bitcoin has been sort of this dormant platform in many respects with a completely underutilized asset base and all of that is changing now extremely rapid so there's huge opportunity uh there's huge opportunity to do new things but there's also a huge opportunity to just see what's worked in other environments in ethereum in salana and bring that over to bitcoin and then just more broadly I think thinking about what we're building not through the lens of chains but through the lens of ledgers of assets

and computation or Asset Management I think is an extremely helpful frame of mind uh to understand what's going to happen next because um we're not a blockchain industry and if we ever were that that that time is coming to an end couldn't agree more that's great not to end on uh yo thank you so much for joining us today on epicenter it's been great learning about Bitcoin us and uh diving diving into Bitcoin for the first time in a long time uh to be honest uh it's been uh really exciting and interesting thanks again thank you