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Relai Bitcoin Session #16 with Matt Odell: Bitcoin Privacy and Censorship-Resistance

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Matt Odell

Matt Odell was our guest today at the Relai Bitcoin Session. Matt is a prominent Bitcoin advocate and a co-host of the famous “Tales from the Crypt podcast” and the host of “The Citadel Dispatch” live show. He is also part of OpenSats, a platform for open source development funding.

You can tune in on YouTube here.

Alternatively, you can listen in on AnchorFM.

Main Takeaways

Matt joined us to talk about Bitcoin privacy and the future of Bitcoin as both a tool for freedom and a highly institutionalized asset.

Can Bitcoin Be Corporate and Crypto-Anarchist?

Matt explains that there is a divide in the Bitcoin community between the corporate/number-go-up side who wants tight regulation and essentially only care about the value of bitcoin increasing and the crypto-anarchist side that wants private, censorship-resistant digital e-cash. However, the two also have a symbiotic relationship as both sides rely on it each other.

“[Bitcoin] is gonna be corporate and surveilled no matter what. So it needs to be built in a way that people can use the tools to achieve privacy and censorship-resistance regardless.”

Matt goes on the explains that we need to have this bearer digital bearer asset that has value. And in the case of Bitcoin, it is designed for the value to increase. That is important because if the value keeps going down over a long period of time, it becomes difficult to send value and for miners to secure the network. At the time time, good money needs to be spent.

So while corporations may have entirely different priorities than sovereign bitcoiners, they support the network by adding investment into the ecosystem. What corporations often don’t realize is that the censorship-resistant folks are actually protecting their interest by making sure that Bitcoin remains a robust, censorship-resistant system.

As long as the tools are there for privacy-oriented people to use bitcoin in a private, censorship-resistant way, it’s fine for companies like MicroStrategy to use bitcoin in a regulated way.

“I think it’s important to have a very vocal, educated sovereign Bitcoin community that keeps [corporations involved in Bitcoin] honest.”

How Can and Should We Improve Bitcoin Privacy?

“We have to keep improving privacy guarantees of Bitcoin whether that’s on the Bitcoin main chain protocol or second layer solutions like Lightning, Liquid or statechains.”

Bitcoin’s biggest attack vector is the privacy side, Matt explains. Users can easily be identified and targeted – for example, by authoritarian regimes – when using bitcoin exchanges with KYC. While the Bitcoin network itself cannot be shut down by governments, identifying Bitcoin users is definitely doable.

Changing Bitcoin’s privacy level on the main chain level will be very difficult. As fees increase, things like CoinJoin become very expensive to use. However, using second-layer solutions, like Lightning, Liquid, and statechains, to increase privacy for Bitcoin users is doable and looks promising, Matt explains.

In the future, we could see new bitcoiners onboarding directly on a (more private) second layer, like Lightning, as Bitcoin on-chain fees will continue to increase.

How Can People Contribute to the Bitcoin Revolution?

“People have this desire to just jump in headfirst. Especially in the beginning, it’s not really advantageous for you to do that because there’s not necessarily a plethora of good bitcoin jobs out there,” Matt explains.

If you are not financially secure while getting paid in bitcoin and an 80% downturn comes, this could become very challenging. Therefore, Matt suggests it’s better to familiarize yourself with Bitcoin first and get comfortable with the technology and then start looking at what you can do in the community.

Organizing bitcoin meet-ups, for example, is a great example of how to get involved in the industry and an excellent way to get your feet wet, suggests Matt.

Arguably the best way to get started with Bitcoin is to stack your first sats. To buy bitcoin, download the Relai app today. 

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