Oddbean

But was this before having other alternatives right? I just don’t see the point of going through the trouble of getting and stacking sats if, at the end, we’re all going to give it back to banks to custody… we have to trust them?

I’m not advocating for giving up custody. I’m not necessarily supporting whatever Saylor is suggesting either. I’m just pointing out that the idea of bitcoin backed banks is nearly as old as bitcoin. Hal seems to be talking about a type of ecash system here backed by bitcoin. But he also discusses some running fractional reserve, and some not, each with varying policies. Should we vilify Hal now?

I’m not saying we should vilify him, my point is, in think we will have better alternatives in the near future to avoid having to trust an entity with our BTC and the network (in a different level, like L2s) able to scale accordingly

Hal even referred to some bitcoin banks offering interest. 😅 I personally don’t want to give up custody of my sats in that way. I am currently ok using custodian for some smallish lightning payments such as zaps, but beyond that I custody everything else myself. I think everyone should learn how. And I think you’re right that those solutions will get better. But I also think some people are jumping to make Saylor a super villain but ignoring stuff like these statements made by Hal, who is otherwise revered.

Only if he vilifies us, saying that our self custody increases seizure risk for the whole system, use our skepticism as a slur, etc, as Saylor just did. Most Bitcoiners seem to endorse custodians and banks, that's what ecash mints are

I'd call it dunking and memeing, to me it seems like the butthurt ones are the Saylor simps Like when politicians say retarded things attacking Bitcoin, we aren't crying and offended, we are saying fuck you to the spooks

Yea he brought this ire on himself and has made some insulting and stupid comments. Not saying he doesn’t deserve it. I’ve thrown a couple memes into the mix even 😂 But the substance of what he’s talking about is what I wish was being discussed more than just him making a douchey comment, because the idea of Bitcoin backed banking is not an idea Saylor invented, and here in that screenshot you have Hal even mentioning some offering interest and running fractional reserve.

Yep it's coming no matter what, it cannot be stopped, if bitcoin is real money, people will lend it and invest it into projects and stuff, this is the purpose of money imo AINT GETTING MINE THOUGH THATS FOR DAMN SURE 🤠

Half is unvilifiable. Not possible. But also he can be wrong. IMO fractional reserve always ends in tears. But also, banking could change slightly in meaning. Aggregating funds and allocating can work for buying equity. Avoid the debt, not the bank.

What was Hal referring to when he mentioned interest rates there? Where is that interest coming from? Not saying I support the idea, but just bringing it up for discussion as it’s basically what Saylor is suggesting.

I’d think the interest is coming from people who borrow and plan to pay back more sats than they borrowed. However, since there is no way for the bank to create more bitcoin, if they make a bad loan both the bank and depositors are at risk. Depositors will be very attentive to the banks lending practices and the banks will be very conservative in their lending. I’d imagine many banking structures, included reserve lending, will exist to accommodate both the high risk/high reward and the low risk depositors. In fact some customers may just pay a fee (negative interest) to be at an institution that is more a custodian than a lender.

I’m sure it would change lending. And while the underlying bitcoin supply couldn’t be increased, if these banks issued their own currency backed by Bitcoin, which is what Hal suggested in that post, and he even went so far as to say some could be fractional reserve, then they could inflate the supply of that currency with which to to pay the interest on Bitcoin deposits. To be clear, I’m not advocating in favor of such a system as it feels to me like a stepping stone right back to where we are now with the fiat system. But I think the fact that so many bitcoiners are emotionally charged right now over what Saylor is suggesting, and yet here is Hal discussing it within a year of Bitcoin’s creation, it at least needs to be brought up and discussed intelligently rather than based purely on emotion.

I agree, and I think Hal was right that there will be banks. Hal was early and probably would have refined his ideas with the advent of liquid, lightning, mints, etc. If they day ever comes that I have BTC in a bank, them creating there own currency that is not 1:1 sats will be the day I start the bank run😎

Yea I’m not meaning that whatever Hal said here should be set in stone as gospel, but merely that it’s not a new topic and Saylor’s ideas probably aren’t all that novel about it. I won’t be depositing my sats anywhere either, for what it’s worth. Recent history has shown all too clearly the risks of chasing yield.

Hal was a visionary. I believe we'll see this happen too. Banking has been around since Mesopotamia, I see Bitcoin taking similar paths. The cool thing about Bitcoin is that if you don't want to use a Bitcoin custodian, you don't have to use one. That's the difference here. We have choices.

💯 I think we’re on the same page. My post is more just a commentary on so many people being highly reactive (maybe overreactive?) to Saylor’s recent comments. I’m not a fan of his recent rhetoric, and found some of his comments off putting, but the overreaction by some feels like it’s more of an emotional response like they were just waiting for any reason to lash out, rather than actually discussing the issue itself.

Hal seems to be arguing for a free market of counterparty risk. The best case is not using a custodian, clearly. But if you must, let a thousand cashu mints bloom? Although Hal is also clear that this is due to the scaling problem. LN (and other scaling ideas) did not exist yet, not sure if he would have changes his opinion with this information. Do you?

Yea it seems to be about payments scaling, but he also mentions some running fractional reserve and offering interest in that same screenshot. So it’s clearly not only payments he was talking about.

I always thought if banks could lose the shackles of Fiat they would have the perfect infrastructure for being lightning nodes. Opened a channel to your bank, your bank has channels open to all the shops, banks, and other "account holders" (people with channels to the same bank). They would make fees by keeping the channels balanced and create an entire web of commerce. But no, there's just a few companies that operate well connected nodes instead of using a federated model (local, county, state, country).

He literally explained LN in that post with "there needs to be a secondary level of payment..." In other words he was referring to LN banks over the LN as I described here: https://darthcoin.substack.com/p/bitcoin-private-banks-over-lightning extended with ecash if you like https://darth-coin.github.io/wallets/bitcoin-adoption-using-ecash-en.html What Saylor wants is something else. He want to do exactly what banksters did with gold: give me your valuable sats and I will give you in exchange the endless printed fiat.