Runes: A Degenerate Casino on the Bitcoin Blockchain Creative | The Protocol
I think that Bitcoin has lost a lot of M
share and a lot of market share to these
other ecosystems um I think people want
to do these things and so the fact that
people have been unable to do these
things on bitcoin has sort of you know
drawn them away from the Bitcoin
ecosystem to these other ecosystems
[Music]
hello and welcome to the protocol
podcast I’m Brad C here with my co-hosts
Margot nykerk and Sam Kessler we’re
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first please don’t forget to subscribe
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coindesk.com and let’s dive right into
it we do have in the house today uh
Casey rhomar
um just fresh off of the runes launch
just a few days ago uh Casey claimed to
us just as we were uh talking before the
show started that this is his first
media appearance since the runs launch
so that’s right the the the freshest
scoop
possible you heard it here on the
protocol um well Casey I mean this is
number two for you I would say based on
kind of response so far you’re you’re
two for two uh in terms of of releasing
pretty you know probably the most
impactful protocols on the Bitcoin
blockchain in two years so uh yeah we’re
pretty lucky to have you I thought maybe
we could just
start I would love to hear you
describe where you were during the
launch and you know what you were what
you were doing what you were looking at
and kind of what your reactions or
thoughts were as that was happening uh I
think like everybody else I was at home
uh watching mempool dospace which is a
Bitcoin blockchain explorer that people
use to watch pending transactions blocks
fees all that um just watching the fees
Spike up uh they got pretty wacky um I
knew that they were going to get you
know reasonably wacky that there were
going to be some H Jinks but the actual
level of wackiness and H Jinks was
completely unprecedented especially the
fees that the highest paying
transactions uh paid in the first block
uh I don’t remember but the actual fee
rates but it was uh many millions of
dollars were were spent in that block it
was uh it was pretty
wacky yeah I was just looking at you
know there’s a bunch of dashbo various
dashboards that people are making I saw
one on
Dune and and it looked based on the data
275 BTC and runes fees so far that works
out to
$134 million uh yeah absolute Insanity I
feel I feel a little guilty that um I
you know encouraged people to take that
money and light it on fire and send it
to the miners but you know here we
are well I mean speaking of of you know
lighting money on fire what what’s
really happening is people were just
creating money right uh but I mean again
there’s a couple different dashboards
for this but I was looking at one called
runes market cap uh and that one puts
the market cap out of $440 million but
then there was another one called sat
screener which puts T Fu I hope that’s
not like some completely dirty thing
that I don’t know what it is but
uh z zue uh
and that one is $2.34 billion dollars
market cap I mean yeah I would I would
take those market cap numbers with a
grain of Sal uh I assume that the
markets are incredibly IL liquid I think
if you actually tried to sell everything
or sell even a significant fraction of
that it would it would nuke the price um
but those numbers are good for me I
publicly commit committed to uh commit
sepu one lunch one month after launch if
the market cap does not reach $1 billion
so it looks like according to to at
least one dashboard I’m I’m in the clear
so that’s good you’re going to make it I
think I’m going to make it I’m going to
make it yeah well does it have to still
be at a billion dollars at that point in
time or just at some point I I think it
still has to be a billion dollars I mean
that’d be pretty weak if it was sub one
billion one month from launch and I I
didn’t kill myself so yeah it’s got to
it’s got to go there and stay there well
all right so another data point here
7,995 etchings so is that’s like unique
a unique token uh yeah so you know one
of the reasons that I make protocols is
so that I can get everybody to use my
very funny words so yeah when you create
a rune this is termed etching a rune um
which sets the name names of runes are
unique they also have unique parameters
which includes um whether or not they
have an open Mint I.E if if at some
point in the future anybody can sort of
create a transaction to claim some
amount of that Rune how much that Rune
they get when they mint it um whether or
not the Rune is pre-mined I.E the etcher
has themselves allocated some amount of
runes to themselves so yeah you etch a
rune and then you can mint a rune if
there is an open Mint at which point you
just get some of that Rune this was the
an allocation mechanism that was
popularized by um brc2 um I think that
the idea that you know the traditional
model is that somebody makes a Tok token
and they claim that they’re going to do
all these fancy things that they’re
going to deliver some sort of utility
and then they use that as an excuse to
sort of dump on investors slowly while
delivering absolutely nothing I mean if
you look at the vast majority 99% of
blockchains are completely worthless um
if you look at coin market cap you’ll
see that there are like quote unquote
serious blockchains like Avalanche and
polka dot that are below the market cap
of Doge um so you know DG really you
know prefer not to see a massive team
allocation and get dumped on so the idea
here is because these things are all you
know not delivering any utility at all
you don’t need a team so the team
allocation is like an inefficiency so
you just let everybody print the token
and that’s just more efficient you know
it’s it’s just uh it’s uh it’s it’s
better for the
DG and let’s just talk about these DG
because I you know heard you talk about
this on on some of
your other podcasts that you’ve been on
including hell money which is so good
you know so much F to listen to uh yeah
hell money podcast wherever F podcast
are sold you know YouTube we make videos
yeah and I did I mean you were talking
about I think on one of them recently
about how when you started you had I
think like 10 people who listened or
something like that yeah um but at any
rate the the
degens who are these degens are these
just the same degens who were
on ethereum and then salana pumping meme
coins or or you know B&B chain or or who
who do you think these people are who
are doing who are who are you know on
runes I I think I think definitely
there’s overlap in the uh the DJ you
know population from these other chains
um I think probably a of them are also
degens who were sort of like activated
um or became degens when ordinals
launched I think there was a lot of
Bitcoin people who sort of wanted to do
these you know degenerate activities but
didn’t particularly want to do them on
other chains they didn’t want to learn
other ecosystems or leave the other
ecosystems and then uh ordinals and
inscriptions and now ruins have have
provided an outlet for these degens on
bitcoin so I assume that there’s some of
them that are you know newly minted
Bitcoin degens but then I think a lot of
them are the the same people who are who
are on other chains so the the pitch
makes a lot of sense to me you’re
basically saying all right um all of
these other ecosystems that are
ostensibly trying to do stuff with tech
are really just launching coins that
people are gambling on anyway and just
allocating some of the money um to
developers and so the idea is to just
make this whole so if you take it that
you know all this other stuff is kind of
BS um you know the idea of of runes is
just like let’s just make it all about
the memes let’s cut out all of the um
you know all of that overhead is that
right yeah definitely and and like I’m
not you know I’m not gonna would I
wouldn’t argue that you know Meme coins
and degeneracy and gambling and
speculation is like a is is the greatest
activity on Earth but I do think that
you know a lot of pro like the the worst
kind of project is one which um claims
and they don’t have to claim dishonestly
like they can believe it right they can
either be scammers or they can believe
they claim that they’re creating the
future of finance that they’re going to
create this thing that is incredible
utility they’re going to create a
metaverse um and then normal people will
see that claim and they will go okay
well that sounds great and buy that
token right um I think that those kinds
of projects are much more likely to do
um a lot more damage to normal people
because they think that they’re you know
walking into a stock market and in fact
they’re just walking into a casino so
the sort of purpose of runes is to be um
as straightforward as possible to be
like no this is a degenerate Casino like
have fun um but don’t you know lose your
shirt um and I hope that that to some
degree um outcompetes these other you
know projects that are making these like
ridiculous claims I mean the the truth
is is like
99.9% of you know quote unquote
cryptocurrency like simply doesn’t work
at all there’s just no there’s just
nothing there like blockchains are not
good for doing doing most anything right
and so the vast number of projects just
will never deliver anything of value so
I think it’s much better to be honest
and kind of distill it down you know
like let’s instead of gambling and fraud
maybe we can just do gambling that’s the
that’s the desire so that makes sense um
but one you know obvious question
becomes if you you know further
associate um now Bitcoin not just crypto
broadly but um the blockchain you know
um I know bitcoin’s like Hey we’re not
crypto it’s Bitcoin so um Bitcoin is
there any fear that Regulators are going
to look at this and inevitably when
people get dumped on I mean it is a
casino um they’re going to take a you
know sharper eye to this technology that
it sounds like you think does have some
fundamentally important use case yeah I
definitely think that Bitcoin is
extremely important um extremely
valuable as a sort of credibly neutral
global settlement layer um I think the
regulatory concerns my my my personal
opinion is probably that’s not so much
of a worry right Regulators have always
gone off after individual sort of coin
issuers they’ve gone after individual
projects I think it’d be pretty
unprecedented for them to be like oh
well people are doing you know bad
things on bitcoin um we should you know
go after the blockchain in some sort of
concerted way and and in reality I think
that the activity that the regulator
would probably be more concerned about
on bitcoin and the reason that Bitcoin
is a a threat to government power is
simply the Bitcoin you know the Bitcoin
token itself right this allows people to
um evade taxes to avoid um sanctions to
avoid government control to have some
Financial privacy um all things that I
think are good maybe not avoiding
sanctions if it’s like North North Korea
but I’m I’m in favor of people like
notay their taxes and the government not
knowing what they’re doing and so I
think that that is the actual sort of
existential threat to the government
that Bitcoin poses and I don’t think
that they’re going to get you know
particularly insens about the fact that
people can you know do meme coins on
bitcoin certainly not to the point that
that would motivate a you know state
level attack on the on the base chain
itself so the you know the the follow-up
question of that just becomes why
Bitcoin then why not just let people do
you know the the casino stuff that
they’re already doing on Solana on
ethereum on apas onu on all of these
ecosystems yeah I mean a couple reasons
so I think that Bitcoin has lost a lot
of Mind share and a lot of market share
to these other ecosystems um I think
people want to do these things and so
the fact that people have been unable to
do these things on bitcoin has sort of
you know drawn them away from the
Bitcoin ecosystem to these other
ecosystems um you know I think that
there’s so yeah I increased use also
increased fees um as the Bitcoin subsidy
declines which is the new Bitcoin
created in every block we just had a
having so it went from uh 6.25 to
3.125 um so as that subsidy of new coins
created per block uh declines fees must
rise to replace that subsidy um
otherwise the chain is insecure so I
think that um having more users having
more mind share having more fee Vue is
all good for Bitcoin and also like I
think that there’s another world in
which if you had the ability to issue
tokens on bitcoin um you know a long
time ago the ecosystem may have
developed such that everybody would see
the tokens and things on bitcoin as
having the most value and a lot of other
Chains would wind up trying to figure
out how to be like layer twos or Bridges
or whatever so that people could have
more functionality with those tokens on
other chains so yeah ultimately I think
it’s it’s good for fees it’s good for
adoption and users and so I’m surprised
that this has happened but it seems like
ordinals and sort of the whole activity
in the Bitcoin space has sparked off a
lot of interest in Bitcoin l2s and
technological development um so I think
that’s that’s good too because as people
want to do the things on bitcoin they
want to do more sophisticated more
complicated things on bitcoin lots of
people start working on Technologies to
enable them to to do those things on
Bitcoin in a lower fee or a more more
expressive way so um you know if I can
just ask one more thing on this point
like just just to play Devil’s Advocate
it does seem like you’re you’re saying
fees mind share users um those are all
things that Bitcoin is um you know
lacking relative to some of these other
ecosystems that have gone really far
down that kind of you know defi Rabbit
Hole mcoin Rabbit Hole um so why you’re
basically saying like why not bring that
to bitcoin in order to you know prop up
all of these things or push down fees
and so on and so forth but there does
seem like there’s still this kind of
underlying tension that I’m curious how
you kind of like reconcile in your own
mind where it’s like are you basically
saying because you did just speak
positively of l2s um you you you know um
you’re saying it’s gambling that is
necessary to you know bring this
excitement bring these fees down bring
these users mind CH so on like is that
just like kind of like an undermining of
the core Bitcoin thesis if it can’t do
this stuff without all these things that
you take issue with on other ecosystems
oh I mean I think Bitcoin would probably
be you know fine without ordinals and
inscriptions and runes I wouldn’t say
that you know I’m like saving Bitcoin
I’m saying that you know I’m doing a
small thing to shore up you know some
parts of you know bitcoin’s weak
weaknesses um but no I think Bitcoin
would probably be fine um the the fees
do worry me in the sense of like the the
having um fees cutting every four years
it is very aggressive and so I think
that all sorts of use is is good and I
wouldn’t want to sort of wait around
until that is a problem um but yeah no I
think bitcoin’s core value proposition
is really is is very strong and it is
you know Head and Shoulders above all
the other cryptocurrencies
cryptocurrencies in the ecosystem and if
you look at the the level of care with
which Bitcoin is developed the quality
of Engineers the amount of quality
contributions um and the sort of
conservatism um with which the chain is
developed it’s it’s far far ahead of
everything else in the ecosystem and
this is just you know supporting you
know one or two very small
things I wanted to ask just real quick
um you know you bring up the the having
and that just happened last week what
you know I’m sure you’ve lived through
various having right now and runes was
such a big part of this one um and
there’s been like a renewed interest in
Bitcoin because of all these twos and
you know ordinals last year and then now
also the Bitcoin ETF so there’s this
like larger mainstream interest I feel
like we’ve seen all sorts of mainstream
um new sources cover this as well I want
to get your perspective on how this
having has been different compared to
previous
ones um yeah I’m trying to think I think
the main thing is just that that I mean
it seems like it’s it’s it’s pretty the
same the having is really a boring event
you know um it’s not a technical risk
the behavior that changes in Bitcoin is
is really just a few small lines of code
like literally like four lines of code
that calculate the new subsidy for each
block and just gets cut in half every
you know every every four years so it’s
a it’s a very boring event I think the
only difference this time was that there
were all these sort of new participants
in the ecosystem that had entered the
ecosystem you know um a little over a
little more than a year ago when when
ordinals went uh live originally um so
yeah I think there’s just a lot of new
Fresh Faces but all in all it’s a very
like boring event um and it was very
it’s always nice you know as developers
I know that Bitcoin can cope with high
fees I know that the network is
self-regulating that it has this nice
property of what’s called back pressure
where you know lots of people are trying
to transact and there’s back pressure in
the form of fees that prevents the
system from getting overloaded um so it
was nice to see that in action
but yeah all things told you know it’s
it’s another having there’s going to be
another one in four years you know until
you know 2142 or whatever it is it’s a
pretty you know routine event yeah no
that’s interesting you say that because
I I read a lot about ethereum and so
with the merge and with all these
different upgrades like the developers
are always happy to hear when it’s like
a boring event because it means that it
worked um but you know every day is a
boring day in Bitcoin which is great
well I guess yeah well maybe maybe all
this new stuff will bring some
excitement back to it but um you know so
I also wanted to ask because I I you
know I heard you on the on the bankless
podcast and and I’m sort of getting here
at you know you some comparisons with
ethereum and an in Tron you had made I
don’t remember the exact wording that
you had mentioned but basically from the
picture that I was getting is that um
there’s been a lot of mistakes or you
know scam gambling on these ecosystems
that people get into crypto and they go
you know go to these change and they and
they avoid Bitcoin but sort of what Sam
was getting at here earlier is asking
okay
well now you’re a lot of this is being
brought to bitcoin um so like I’m trying
to sort of understand the connection
here if if there what is it different
about these same sort of Technologies on
these you know not as um as and please
like you know correct me for my wording
I don’t want to put words in your mouth
but from my interpretation was like
these scam your blockchains like if
that’s all happening on these other
blockchains why is it okay on bitcoin
oh I mean I certainly wouldn’t make the
argument that anything that’s not okay
on other blockchains is okay on bitcoin
um so yeah I mean uh I I think one thing
is that the sort of the culture of the
community is a little bit different um
it is not a culture where people really
make serious claims about you know crazy
claims about some utility that doesn’t
exist which is sort of my primary
complaint about a lot of this activities
on other blockchains me meme coins on
Bitcoins are the same as meme coins on
other blockchains um but my hope is is
that due to the culture we see less of
these claims that somebody’s going to
make a token that you should buy because
it’s going to do something um currently
we see claims of people uh saying that
you should buy this token because it’s
related to some funny story that I wrote
a long time ago or it’s a dogcoin or
something like that I’m much more
positive about those activities um on
bitcoin than I am on other blockchains
and also like yeah there’s a lot of
activity that I’m not a fan of wherever
it happens but I think that Bitcoin is
good for the world so if ultimately that
brings users to bitcoin it brings mind
share to bitcoin I think that those uh
negative some activities or possibly
positive some in taking in whole with uh
improving bitcoin’s
adoption and then also like another
thing that you had mentioned on on uh
Bank list was that you don’t think that
ethereum could with like could stand a
nation state type of attack and I
thought that was really interesting
because I I have actually like talked a
lot to um like someone on the team at
the ethereum foundation whose job it is
to uh you know find these Co like these
vulnerabilities in the code so that like
ethereum can withstand a a nation state
attack and so it’s interesting because
you know they they I’m using the EF here
as an example because they’ve deployed
like a bunch of resources they’ve hired
a bunch of people who were in government
um you know working on these kind of
things so what is it specifically that
you think that Bitcoin like why this
Bitcoin could withstand stand it ver and
not
ethereum yeah so there’s there’s a few
things so I think that there’re just
components to ethereum that are very
fragile and very um centralized so one
with um with ethereum staking protocols
um I would have to go and look up all
the you know numbers on this but for
example there are a few uh very large um
uh sort of proxy stakers on ethereum
that individual eth holders will like
deposit their eth to be staked by this
other entity and then they can receive a
token which allows them to get liquidity
for their staked e so that there these
very there’s a small number of very
large pools of capital that if a nation
state was able to uh take control over
those pools of capital they would have
significant sway in in which blocks were
produced so that’s one aspect another
aspect is that um the vast majority I
think almost all of ethereum’s blocks
are
um com compiled by a centralized entity
I always get this wrong I think it’s
like flash Bots or something um but this
is the entity that
essentially constructs the most
profitable block templates and just
tells miners like okay this is the block
template that you should um or ethereum
stakers or whatever they call it this is
the block template that should be the
next block I will give you a cut of the
fees from this block if you make this
block the next block um I think that
that’s one entity that constructs you
know I think like 70% or more of
ethereum’s blocks maybe just to clarify
that’s not exactly how just
toast so there’s like a there’s an
infrastructure that everybody uses but
there’s like a bunch of different
entities that use that infrastructure
I’ve written a bunch about how that’s
centralized um to to be fair um but just
for the sake of you know Clarity um
right so isn’t it one entity that
constructs the blocks that are going to
be used by
so um it’s a bit of an aside but
basically what happens on ethereum is
you have a bunch of you know people who
like theoretically the idea of how it
works is you have stakers who are
constructing blocks meaning they take
things from the men poool from the queue
of transactions and then they order them
into blocks what um people have started
doing is they’re like hey what if I put
my own transaction as a validator at the
top I can you know front run people and
I can front them run them really
effectively because I can see what order
everything’s going to be in I set the
order
so you have flash Bots that came in to
kind of solve but also depending on who
you ask make that problem worse by
creating this middleware that all of
these validators also called stakers use
where it’s a third-party Marketplace of
they’re called Builders and Searchers
that compete with one another to create
those templates create those orders
create blocks and then give them to
validators but they have to kind of
compete it’s still a competitive
Marketplace you have a few builders that
do kind of monopolize the market
Monopoly isn’t the word because there’s
a few but I think the software itself is
used by everybody um so there’s a
difference there it’s like yeah I don’t
know I I don’t know if that just made
things more complicated or less no no no
no yeah I mean yeah and also this is the
case where I would really have to do
more informed research um but yeah so
this is an additional you know
centralizing comp component that maybe
could be exploited um and then also the
technical complexity of ethereum is is
just such that I am not super
confident that there are not just
outright bugs and vulnerabilities in the
algorithm um also I I think proof of
stake is very centralizing um if
you have some amount of stake in a
network um by just doing nothing you
will maintain that percentage of stake
which is very different from Bitcoin
mining where you must continually expend
Capital to maintain your hash rate right
if you have 50 you have 50% of network
hash rate and you don’t do anything the
default state is for your hash rate to
decline as you know your miners go
offline as you’re not paying the energy
bills or whatever you must actively
expend Capital to keep that up so
ethereum um you have some percentage of
stake the default is for you to just
keep that percentage of stake if you
keep that uh staked on the network um
that is an additional centralizing
Factor so there’s all these centralizing
factors for ethereum which make me sort
of think that it would not withstand
serious attack or serious uh
regulatory um interference additionally
like the centralization of the ethereum
uh foundation on development decisions
they basically just railroad users
through hard Fork after hardfork and
there isn’t really a meaningful way to
for users to opt out if you compare this
with Bitcoin where the developers have
to like beg the users like please like
adopt my soft Fork um and everybody has
to be very sure that it’s a good idea
this is obvious VI l a slower pace of
development but it is a more
conservative pace of development so yeah
all these things make me think that
ethereum probably can’t withstand a
nation state attack which makes it less
interesting to me because I think that’s
actually the entire point of this whole
cryptocurrency thing like the government
is the enemy and if you cannot withstand
an attack from your enemy like what are
you doing like get off the
battlefield that’s really interesting um
Casey just to kind of push it back
towards runes uh I think you were
talking about on your last hell money uh
podcast with with Raph about a lot of
the the auditing and and you know um
checking of the code that you did not
enough not enough but we did check it a
lot a lot of it right and I’m just
curious since the launch have you found
any bugs or have you had issues that you
had to deal with maybe that might be
interesting to hear about yeah um so we
I have a friend he’s the he shall remain
nameless because he’s a very private
person but he’s the smartest person I
know and if you ask people who know me
and him he’s the smartest person they
know so he’s way smarter than me um we
paid him to look over the code um before
launch he found a bunch of bugs um
including one that we fixed but then a
bunch of people were running an old
version of the code a few days ago so I
think like half the network just kind of
went offline uh because they hadn’t
updated the latest re version they then
updated the latest version and
everything is fine so that was a bug
that existed that was found aside from
that that was what like Saturday or
Sunday or or yeah Saturday and Sunday it
was a divide by zero you know classic
classic bug you know just really one of
the all-time greats um and then there
really hasn’t been a lot else that has
been you know really critical um the
only two issues that come to mind is
that people were creating transactions
with very high fees and I didn’t know
that Bitcoin core has a um has a setting
to reject very transactions that pay
what it think is too high of a fee um in
that transaction so these transactions
were being constructed by or which is
our software and then getting sent to
bitcoin core and then getting rejected
which is sort of a bad user experience
um but it’s pretty minor it didn’t
affect a ton of people and then also um
one thing in the mint logic where the
wallet was being a little bit too
conservative about when it could mint it
would think that A Min a mint was not
open um one block in advance so it’s a
little slower to let people mint but all
told it’s actually been very smooth um
the software is hard to use like it does
kind of suck but uh no horrific bugs so
far okay uh let’s take a quick break and
we’ll be right
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and we’re back with Casey Roar uh Casey
one of the things that we’ve written
about a
lot is and you hinted at
it developers begging people to adopt
their softworks and you know how how
hard it is to get a bip number in fact I
we breaking I don’t know if you heard
that that opcat just got a bit number
and it’s not the fake uh bit number
really yeah it’s like 367 or something
all right there we go yeah so for yeah
the the bip’s uh the bip repo bip is St
for Bitcoin Improvement proposal it is a
repository that’s maintained on GitHub
which um uh
it uh sort of archives um documentation
and Technical proposals related to
bitcoin uh for a long time the repo only
had one editor he was very overworked it
was very slow for things to get merged
but uh day before yesterday Monday uh
four new bip editors were proposed four
or five new bip editors um and they’ve
been merging PRS and doing a lot of work
and commenting on issues so that’s been
really great to see so yeah was a roast
beef I’m not sure what that person’s
actual name
is Lalu uh his last name is Nigerian and
very hard to pronounce interesting yeah
he that’s his name on the U he’s one of
the main developers at lightning Labs on
the lightning protocol yeah rast be uh
caner John attack uh merch all new all
new bip editors longstanding community
members so it’s great according to the
the
repository um roast beef was the one who
assigned the uh the new bit number but
aside from that I mean that that’s just
the first step of even beginning to
think about whether that would ever get
merged right and so I’m
curious one of your breakthroughs it
seems like has been the
conscious decision that you just got to
make do with what you got I mean you
just kind of buil into you know I mean
with ordinals you just kind of built it
on there and now here again you’re just
kind of building it on on there not
asking for any changes I I’m curious if
you think that is kind of realistically
the only option for Bitcoin well um I do
think that it is the only option for
weird things like ordinal inscriptions
and runes that I I would not even
Advocate that those should be added to
the Bitcoin based layer um I don’t think
that Bitcoin should Bitcoin core should
concern itself with uh these sort of
higher level asset protocols I mean only
if runes got like massively systemically
important would I say that okay maybe
the consensus rules should be amended
such that you know certain kinds of
invalid transactions aren’t accepted
into blocks I mean but that is like a
you know crazy implausible future
scenario um but yeah for for a lot of
things I think it is the appropriate way
to develop on bitcoin is to avoid trying
to change Bitcoin it’s very hard and
it’s very it’s necessarily very
conservative and just figure out how to
do it on top of Bitcoin without
modifications um I’ve been in Bitcoin
for a long time I’ve looked at the at
the process for getting Bitcoin changed
and it’s a oftentimes very contentious
very slow very political process that I
would really rather like drink poison
and jump off a bridge than participate
in uh so yeah I always I always build
things on top but yeah there there are a
lot of core
upgrades to bitcoin that cannot be made
without changes to the base layer or you
can only make much more infu versions of
them um without changing the base layer
so yeah I think there there are a lot of
changes to the base layer that that
would be nice and I think that there’s
been a lot of interest and activity um
in the last couple years I think it
helps a lot that right now there are a
number of software proposals that people
are interested in there’s opcat there’s
op CTV there’s
APO um and and I think that the fact
that there are a bunch of things on the
table makes it more likely that we will
get one or more um soft Forks soon I I
would actually be surprised if in two
years we hadn’t enabled at least one new
thing on bitcoin because it seems like
there’s uh developing sort of momentum
in that direction and and you know one
of the other things on a related note
that’s got people excited as Robin
Linus’s bit VM and and it’s the same
principle there right which is that you
don’t need to make any changes to
bitcoin cor uh in order to do that and a
lot of people are thinking that that
could facilitate the layer two
development and you’ve talked about you
talked about that earlier I’m curious if
you think that is ultimately where runes
would end up on some kind of Layer Two
yeah I mean I think that um people a lot
of what people want layer Twos for is
even higher frequency degeneracy that
you know centers around tokens and if
you want a token to exist on an L2 and
be able to go back to the L1 you know
back and forth or move between l2s um it
needs to be able to settle on the base
chain um it needs to be able to exist on
the base chain so that it can go from
the base chain to an L2 back to the
based chain to another L2 and so I think
that if l2s become popular it will be
very natural that um runes goes to l2s
and and probably gets very high use on
l2s with uh ever more advanced forms of
of gambling and speculation hyper hyper
gambling where where else do you see um
these l2s going like what other kind of
things do you think they’re going to
accommodate I don’t know I guess I am
you know my default
like my default posture towards these
kinds of things is just one of
skepticism that the UI is going to be
good enough for it to get a lot of use
um I was very optimistic about the
lightning Network and I think that the
level of adoption so far of the
lightning network has been a bit a bit
disappointing um especially the you know
non-custodial individual users using the
lightning Network um it is very hard to
make a lightning Network wallet which
does not sort of expose some of the
underlying like limitations or the
underlying ways that the lightning
network works you know um you have this
wallet you can sort of paper over these
things but underneath you still have
channels opening and closing you still
have onchain transactions that need to
be made um so my sort of default
assumption is that is that l2s might be
the same way that they might kind of
have these um usability limitations um
but this is not a informed opinion I I
hope I’m wrong um and in which case I
mean I think we’ll see the same things
that we see on other chains I think
we’ll see you know somebody build a
salana L2 that is just you know million
miles a minute degeneracy and that will
just sort of exist as a venue for people
to take their their Bitcoin assets my my
last question just on that is just
around like do you see uh so you seem to
have certainty that these other
ecosystems aren’t you know fulfilling
their promises they’re not going to work
ethereum centralized for all these
reasons you know we haven’t seen smart
contracts really lead to the kinds of
use cases that are world changing in the
way that their developers promise
they’ll be so people are pulling money
into these tokens based on false
unfulfillable promises so on and so
forth but you don’t have that certainty
when you talk about these l2s on bitcoin
like you do seem to have some optimism
that the ux will be so like such that it
does prove useful well okay yeah to to
be clear like I think it’s likely that
we might see on these l2s exactly the
same things that we see on these other
ecosystems you know like um l2s which
are sort of nominally decentralized but
in reality are very vulnerable to attack
like ethereum l2s a lot of them are just
sort of glorified multisig at this point
um I think it’s very likely that we’ll
just recapitulate that kind of stuff um
I think possibly the most yeah I wonder
what would be like the most useful L2 I
think probably the most like legitimate
use of crypto as aside from Bitcoin
itself is stable coins right because
they give people access to uh payments
um and unfortunately the most popular
stable coin as of this moment if things
haven’t changed is a tether on Tron
right which is like just a kind of silly
combo so it is it is the case so that
tether off offers or Tron offers very
very low fees and tether is like a fully
backed fully centralized stable coin but
it does provide users what they want so
maybe I have some optimism that we’ll
see something like that on bitcoin like
a highfrequency side chain that lets
people transact in a in a relatively
high quality back stable coin I guess
that would be good um but yeah no I mean
I think the one thing that Bitcoin l2s
can do that
other l2s or other ecosystems can’t do
is scale the trust minimized transfer of
Bitcoin the asset itself um I think that
is
the really the possibly the only thing
that is is really like an unalloyed good
that I would expect to come out of these
l2s if we could get an L2 that enabled a
good user experience while letting
people instantly transfer Bitcoin for
low fees that would be phenomenal and
would be I think very very good for
Bitcoin and and ultimately very good for
the world Casey I heard you mention that
you do see or you did this is before the
launch you saw runes becoming the
default fungible token protocol or
standard on
bitcoin and uh and so you’re talking
about stable coins here I mean do you
see somebody trying to launch a stable
coin via
runes I mean it’ll probably be it’ll
probably happen it’s an interesting
question um because there was actually
uh tether was actually originally on
bitcoin there was a very old protocol I
think it was called Master shares and
later called the Omni layer um which was
an asset issuance protocol on bitcoin
and tether had tether was originally
issued on the Omni layer that that’s
sort of settled on bitcoin the Omni lay
got almost no usage um I don’t know
enough about the Omni lay to know what
its problems were but yeah it got almost
no usage and then tether retired uh
tether on on on bitcoin so you know it
could be that there’s no market demand
for it and that’s why it it went away it
could be that there were problems with
the Omni layer that made it not worth
running and that’s why it went away if
it’s that latter case then yeah it is is
possible that we could see stable coins
on coin and even if tether doesn’t do it
I’m I’m sure some degenerate will be
like oh yeah stable runes baby let’s go
like 10% management Fe why not so yeah
it’ll probably happen I mean just to
take it from there going back to one of
your earlier points about you know and
different people have different opinions
about a lot of this stuff obviously
but so-called legit projects maybe in
some of the other ecos systems or or you
know people who are Bonafide developers
with real credentials who are plausibly
honestly trying to make good projects
for Humanity right and then they launch
a token for whatever reason um I mean
there’s nothing to prevent people from
doing that with runes right certainly
not no it’s a it’s a free market let’s
go and so I mean do you expect expect
some projects to take advantage of that
probably I hope they can just get out
competed by the memers you know like uh
why buy a token that is like oh the
metaverse or whatever when there’s a
token with a funny picture of a dog so
hopefully the memers can can out compete
those
people and one other just one related
thing regarding the memers I mean
you expressed some concern I think in
your last H money podcast episode that
ruins might be a
flop and um that you know maybe Bitcoin
wasn’t the best place for mem coiners
for various reasons uh and now we have
seen this incredible uptake at least in
the first early days I’m curious if you
see you know what we’ve
seen so far if you if you think it’s
going to be if it’s going to be
sustained I think it still could
certainly be a flop you know um there
was very high interest initially um fees
have gone down enormously already I
think they’re back to the sort of the
preh having fee rate um so it could
easily still be a flop and the the sort
of the the thesis of tokens on bitcoin
is is is an interesting one like I think
that inscriptions they really did
something very different from nfts on
other chains they really provided these
strong guarantees that your content was
onchain um and they provided a sort of
Simplicity to how it works um that I
think really provides a like a
compelling benefit over tokens on other
chains um runes I think are much more
like incremental they’re like the rc20
which already exists but more efficient
they’re actually much much more
efficient in terms of uh the transaction
fees that you’ll wind up paying to do
these transactions but you know how how
things develop in the future is is is
hard to say I do think that among all
the Bitcoin fungible token protocol
standards I think that runes I think
runes is the most appealing um the
landscape kind of looks like brc2 which
is the sort of early like meme coin
protocol that was built on inscriptions
um bc20 is very
inefficient and they’re doing all sorts
of like weird stuff with the protocol
now that I I don’t think is going to
work out um then there’s a sort a bunch
of other sort of like ordinals adjacent
protocols like the pipe protocol and uh
BRC 420 and all that stuff I don’t think
a lot of those have gotten very
significant adoption then there’s two
sort of more serious protocols which one
is RGB which is a Bitcoin fungible token
protocol and smart contracts platform I
think RGB is very over-engineered and
has a lot of UI problems that that
people will realize that it has um I did
a I did a podcast uh how many podcasts
on this um just talking to two
developers working on RGB my sort of
overall opinion of RGB is that it’s way
way too complicated it’s also been in
development hell for a long time it’s
been de in in development for like
literally six years um which kind of
gives you an indication of how
complicated it is and then there’s tap
rot assets by lightning Labs I think
that possibly has the best chance if
they’re able to announce a really strong
stable coin partnership and get that
stable coin transferring on the
lightning network using tappered Assets
in that case I do think that that that
would have like a fighting chance but as
things stands now I think runes is just
the the simplest um most efficient
easiest to understand uh protocols so I
I at the moment I do expect that if
there is a fungible token protocol
standard on bitcoin it winds up it winds
up being
runes and Casey
you have talked a lot about how your
your consternation about
the potentially horrendous names that
people would give runes zero through 10
zero through nine right so much so that
you you uh obsessed to the point that
you actually named the first one just to
make sure it wasn’t horrible I think
were your words but I’m curious what you
think now that you can seen you know
some of which are not uh namable here on
a on a PG uh blockchain Tech but
podcast um what do you think about some
of the names that people have been
coming up with the djents are really bad
at coming up with names I mean they’re
bad they’re not good um but I do think
they are getting better and I do think
the the cream of the crop is starting to
to rise to the top like a high fee
environment really sharpens all swords
as far as uh naming goes so I I do feel
like the the the average quality is not
getting better but the highest
percentile quality I do think is getting
better so far there’s only been a couple
you know really offensive runes even
those were were not that bad um so yeah
fingers crossed uh but more than a
couple I would I mean I’ve scrolled
through um
some now what I mean there’s
7,995 I mean but and do you have a
favorite uh so far my favorite is is
probably not mentionable on this podcast
uh I wrote a
NSFW just absurd story a long time ago
that’s on my blog and people found that
story and then they created a meme coin
based on the events of that story and uh
yeah so I like that one just because
it’s it’s it’s creative and deeply
offensive and I mean just we can we can
wrap it here and thanks again for being
with us Casey but you know just kind of
a postcript
I think you’ve mentioned that you’re
you’ve you’ve runes you’ve delivered to
the world the dgs are using
it and uh and and and it sounds like
there’s not a lot more that you think or
want to do with runes per se and uh I
think you mentioned that you were
thinking about a file
sharing protocol uh as your next project
uh
curious if that’s if that’s accurate and
and why why that well I mean um I I’ve
I’ve worked on bitcoin stuff for a while
now um I don’t actually have any like
super clever ideas about if I was going
to do something on bitcoin what my next
project would be um I you know I like I
like copy things right like I saw nfts
on other chains and I was like okay
maybe I can design a better version for
Bitcoin and then I saw brt c20s on
bitcoin and I was like well this offends
my technical sensibilities so let me
design something better for Bitcoin um
maybe I’ll have a super clever idea
about something to do on bitcoin uh but
uh I do not have any such clever ideas
at the moment um and file sharing has
always been near and dear to my heart as
a lifelong uh that just a lifelong
pirate you know pirating content since
my early days uh I really dislike
copyright I I don’t think that copyright
is a net benefit to the world um I think
the terms are absolutely insane like the
fact that copyright lasts for more than
10 years I think is just an absolute
absurdity just an AB insane absurdity
like yeah so don’t like copyright don’t
like the major rights holders
um the sort of the user experience on
streaming platforms has kind of gotten
worse and worse as they’ve started to
balkanize it kind of used to be that
there was a small number of platforms
that you could watch all the content on
if you paid the subscription fee now
they’re more and more fragmented fees
are higher and higher I think that this
has to do with the poor user experience
of existing filesharing Technologies um
the the most popular ones right now are
probably bit torrent and uset and those
both have not great user experiences for
a newbie and so I think that I can
probably improve on the user experience
of those um of of those Technologies
just sort of improve the file sharing
user experience and draw some some
Normie users to the uh the high seas and
does that have anything to do with
Bitcoin no not at all not at all not at
all no blockchain no cryptocurrency if
somebody tells you like file sharing
cryptocurrency projects
anything related to that are my least
favorite they’re so stupid they’re so
stupid file
coin dumbest [ __ ] on earth like unreal
like there’s no reason you want to trade
files over the internet you want to
store data there’s no reason you need to
put a blockchain anywhere near that like
there’s no reason you need to do proof
of work on your like downloaded movies
so yeah file sharing doesn’t benefit
from a token doesn’t benefit from a
blockchain like all these other
applications right like metaverse plus
blockchain is worse than metaverse on
its own like you mean I need a token to
the connect to the metaverse so yeah no
this is a pure fil sharing project um no
cryptocurrency no blockchain
whatsoever okay thank you um anything
else Casey I mean you know top of mind
no uh just got to shill the Pod uh go
watch H money podcast whever F podcaster
soul
Aaron literally like watches my like
media appearances and if I don’t show
the podcast then she beats me so uh yeah
just got to do that but yeah it’s been
it’s been great talking to you guys
thanks so much for thank you so much
Casey really appreciate it thank you all
right thank you well that wraps uh our
episode for today uh thank you so much
for Casey rmar uh from runes and
ordinals creator of runes and ordinals
it’s kind kind of a mouthful case I feel
like need you title
yeah but um uh and thanks to our
producer Michelle muso uh and our Booker
Mel Montanas that’s it for this week uh
thank you for listening to the protocol
podcast if you have any questions about
any stories or comments please reach out
to us at podcast coindesk.com subject
line the protocol you can listen to US
Weekly on coindesk podcast Network or
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please subscribe to our Weekly
Newsletter the protocol on coindesk.com
see you next week
In this installment of “The Protocol,” hosts Brad Keoun, the founding editor of The Protocol Newsletter, and tech journalists Sam Kessler and Margaux Nijkerk, are joined by Casey Rodarmor to discuss the launch of Runes, a protocol on the Bitcoin blockchain that allows users to create and trade meme coins. Casey expresses skepticism about the usability of layer 2 solutions and the potential for stablecoins on Bitcoin.
00:00 Introduction and Background
05:58 Runes: A Degenerate Casino on the Bitcoin Blockchain
13:58 Bitcoin’s Strengths and Ethereum’s Weaknesses
27:58 Bugs and Challenges Before the Launch
35:26 The Potential for Stablecoins on Bitcoin
41:59 Creative and Offensive Rune Names
49:57 Developing a User-Friendly File-Sharing Protocol
#cryptocurrency #digitalfinance #finance #bitcoin #crypto #runes #caseyrodarmor #theprotocol #podcast
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