
Bitcoin 2.0 is Impossible - Daily Live 3/21/23 | E333
Bitcoin & Markets
The Decentralization of Bitcoin
Tyler Cowen: People still don't understand why the Bitcoin supply is fixed. It's because it's written in the software and the software is distributed, he says. He adds that one of the regulatory vulnerabilities for Bitcoin would be regulating what version of Bitcoin your business can run.Cowen: There are some intricacies to Bitcoin but if there is a globalist international institution left in 50 years, that could be possible attack vector on Bitcoin.
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Speaker 1
So let's continue.
Speaker 6
Why is it? You've got to explain to me one thing. Why is the supply fixed? And is that because someone says it's
Speaker 1
fixed? People are still so far behind. This is the power launch on CNBC. And they've talked to Bitcoiners for years, probably going back 10 years. I think they had Roger Veyron and stuff like 10 years ago. And they still don't understand why the Bitcoin supply is fixed. I mean, he is obviously older. So it's harder for older people to
Speaker 2
wrap their brain around Bitcoin,
Speaker 1
but we're still very early.
Speaker 6
Who could change their mind? No,
Speaker 3
it's a great point in question, Tyler. It's because it's written in the software and the software is distributed. There is no one person to ask. There is no one person to trust. The whole decentralization is it decentralized so that you could put pictures and NFTs on the blockchain. Is it decentralized so that you could fix gaming? No, it's decentralized so that the defendants of the monetary policy are distributed is so that it's a network of computers that actually defend the policy and instrumentation of the monetary asset. That is not the case for Ethereum. That is not the case for any other altcoin. That is not the case for the US dollar. That is not the case for Miami real estate. That is not the case for precious metals. It is the it is the only monetary instrument that has its monetary policy distributed and defended and it's sound.
Speaker 6
Forgive me for me. Dense, so you can read. If you say that, then it's because this is the way the software is written and it is immutable. It is unchanged. Why couldn't the software be rewritten or why couldn't the authors of the software or the guardians of the software write a new software that creates Bitcoin 2.0 with another supply of fixed supply of Bitcoin?
Speaker 3
Yeah, so Tyler, I run Bitcoin software and someone tried to do this. I want you to Google Bitcoin Cash after this interview is over. Someone said, I want to change the rules of Bitcoin. I may want to create more of a supply. I may want to make it faster. I may want to make it do a backflip. I may make it want to store pictures of monkeys drilling on themselves on the blockchain and they created it and they created new rules and they called it Bitcoin Cash. It's a different asset. It's a different instrument. When someone tries to pay me in it, my software rules that I run in my home in a room over there says, nope, that's invalid. That thing is a piece of poop and I don't accept it because it is invalidating the rules of the system that were set out by Satoshi Nakamoto over a decade ago. So you can create whatever you want. You want to create FedNow coin, flip a dukey coin. I don't care. There's 21 million of the things that I run and that I protect and that I save in and those rules were started a long time ago and that's what the network runs. So if you change the rules, you're creating a different monetary asset and a different instrument. It doesn't matter.
Speaker 2
Okay, great, great answer. I
Speaker 1
might say something a little bit different like
Speaker 2
who's in charge of the software on my node?
Speaker 1
You would have to go to every Bitcoin node and change that software and it's not set up like that to, you know, where when you run Windows or you run Android or whatever, it pretty much does automatic updates with Bitcoin. It's not set up that way. Someone has to physically come in and update your software to a different software. Listening to this though, a second or third time through is it made me think that one of the regulatory vulnerabilities, one of the surface areas of attack for Bitcoin would be regulating the Bitcoin software that you run. That's possible, you know, like say, hey, there is some Bitcoin like under the Treasury Department in the future, they might have rules and regulations around what kind of what version of Bitcoin software your business can run, not an individual. But if you're Coinbase, you have to run Bitcoin core, you know, 35.2 or newer. And then they control what that version is. So that is a vulnerability in the future for these businesses. One other reason to hold your own keys and all of that. However, that would actually fork US Bitcoin away from global Bitcoin. So there are some interest intricacies there. But if
Speaker 2
there is, say, some
Speaker 1
globalist international institution left in 50 years, that could be a possible attack vector on Bitcoin. So we'll just have to keep an eye out for that. But let's continue with this interview. All right, guys, breaking in on the edit. I wanted to add a few more things, especially for people that are new to Bitcoin that are finding this podcast. And it's always good to go over these monetary arguments again. But the question is, why can't you just update the
Speaker 6
code? There's a
Speaker 1
lot of problems with this. First
Speaker 2
and foremost, is the monetary property
Speaker 1
problem here of durability. One of the monetary properties that you want to maximize for is durability.
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