Grokking Bitcoin with Kalle Rosenbaum - Author Cast 5

Yeah. And, and the, the, uh, the, the main, the main challenge for me was to, how do you make a deep technical book without using code? Because I don't, I didn't want to target just the programmers. I wanted to target the Bitcoin users in general because understanding how Bitcoin works is very— to have a big group of people who actually understand how Bitcoin works will make Bitcoin more resilient against attacks and will make them less vulnerable to bullshit. So, well, uh, my, my goal was to explain Bitcoin to technical people, technically oriented people, but not necessarily to, to developers. And I do that by using, uh, like very kind of detailed diagrams and concrete examples instead of, instead of, uh, program code.

Yes. In that regard, this— sorry.

Yeah, go ahead.

It's, it's really a special book because of the diagrams. There's over 400, um, really detailed graphs to explain. And like you said, there's not much code there. Some of it is, but it's, it is intended, it is some, it is readable to somebody like me who doesn't program. It's just, it does take a lot of effort and curiosity to, to get to the bottom of it. I think you use great analogies and, and, uh, you know, the figures make it really, really clear. And this is also one reason why it's such a difficult book to make because there's so much content that the amount of data there is staggering. You have to really see this book. And one more thing about the, you know, the publisher wanted to ask if you want to write a book about blockchain. Funnily enough, we kind of, we decided to use that mindset against the market in a way. In the Finnish version, because we actually named the book, as you know, it's called Syvemmälle Lohkoketjuun in Finnish, which means dwelling deeper into blockchain. Because in Finland and in maybe many other countries as well, it's it's still the narrative. You know, blockchain is interesting. You know, Bitcoin is old technology, blah blah blah. And the point that we are trying to make with this is that Bitcoin is the blockchain, or rather. A blockchain is a fundamental part of how Bitcoin works and, and that's pretty much it. You know, if you want to learn about it more, you learn about Bitcoin. There's no other use case for the, for the blockchain than we're talking about the, uh, some kind of a distributed database solution rather than, than a blockchain. So, uh, yeah, just something, something interesting to share there.

Yeah. Maybe I should say a few words about how the book is laid out or what the learning path is. Because that's quite interesting to, to me. And I'm quite proud of this as well. It's that it's quite hard to start learning about Bitcoin by studying Bitcoin itself because Bitcoin, Bitcoin is a closed loop of, of technologies and you can't just dive into one of, one part of Bitcoin and just understand that part. without the context of the other parts. So, um, I started by, I, I started, I, we built in the book, we build Bitcoin from scratch. You start out with a stupid spreadsheet system that anybody can, can understand, and it's highly centralized, highly censorable. Uh, so it's not censorship resistant at all. And then we add certain technologies to this spreadsheet and in each chapter. So each chapter basically starts with a, with a problem description of the current system. Why we focus, for example, on, uh, in the very first chapter or third chapter, actually second chapter, sorry. We, uh, We conclude that anybody can steal coins from, from someone else by just faking their, their, their name saying, hey, I'm, I'm Niko, please send money to the cafe. And then we solved that issue by, by, by applying certain Bitcoin technology, in this case, digital signatures. And that's, that's the path of the book for the first 8 chapters. So after chapter 8, we have built actually, uh, Bitcoin from scratch. Uh, so that's, that's a nice way to learn Bitcoin. That's, that's how I would have loved to learn Bitcoin when I started out. Unfortunately, there, there is, unfortunately there weren't any such resources then. Uh, yeah. So I, I just wanted to, to mention how—

No, it's definitely worth mentioning. And I think that's one of the best part of, parts of the book, the pedag— pedagogical approach, how, how you explain it to people. And that's also one reason what made me think that this might be something one day that will be taught in the university level of, of, you know, like an introductory course on, on how Bitcoin works. I think it serves really well with that. Like if, if, if you are, if you went to, you know, you did high school mathematics and, and you're a curious personality, I think you're not going to have trouble with this book. Of course, it's going to be a lot of work when you go through it. However, and maybe this, this is where we can talk a little bit about the publishing model that you chose, which is also very interesting and worth mentioning here because it is in fact for free available to everybody. Right?

Right. Yeah. So I, I, I, uh, my requirement when I wrote the book for Manning was that we would also publish it as an open source version, uh, with, uh, the exact same content. So it, it isn't crippled in any way. The open source version, version actually, it's more up to date because it would have all the errata fixes in it. Uh, so it's available for free on GitHub. Uh, you can search for Grokking Bitcoin there, or I have also, uh, built a version to, in an HTML version of the book that you can browse on my website. Uh, should I mention it here?

Yeah, go ahead and we'll put the link down, down in the description as well.

Yeah, so it's at rosenbaum.se/book. So please check it out there. It's a nice try before buy option if, if you, if you're just interested to get more, uh, to get a better idea of the book.

Yep. And, and, you know, like, I, I like physical books and I, for example, that this kind of book is really shines as a physical copy. But as you said, you know, updating the content, you know, you kind of have to get the new book if you want the updated content. But of course you can use these both in tandem. And like, it's the HTML version is actually my favorite because it's kind of like a really great index. I mean, sure, it's, it's big when you load it the first time, but then you can do queries and you can do searches within the book and you can find just the, just the info you're looking for. And yeah, I think they work really well together. And I think you made the correct choice and I hope, uh, more, more and more publishers go this road. So the information is not going to be impeded by, you know, any kind of financial barriers or any kind of barriers. You know, maybe, maybe you can't even order books to some or say that you, it's not really convenient to ship to some countries, but, uh, everybody has access to the internet and it's a great way to check it out if, if it's something that you'll be into. then I will highly recommend you either get the original English or get the German version we did or get the Finnish version we did. And by the way, all of these versions will honor the open source version as well. So there will be an HTML version and it will be accessible for free for everybody. And on top of that, you can get the really nice premium print version if you choose. So what are the core lessons? Like we talked about, or I talked about kind of like having this as a a part of a university curriculum? And what are the core lessons that you can learn from this book?

Yeah, so I would say that the core lessons are that for every hoops, for all the hoops and loops we go through when in Bitcoin, how Bitcoin is built, It's a complex system, but the complexity comes from, from the fact that Bitcoin, unlike other systems, needs to achieve censorship resistance. Bitcoin is a censorship-resistant system, which means no one can stop it. No, no one can block people from making transactions or, or use the system. So, uh, and in order to achieve this, we need to go through all these weird technologies that we use. So all the hoops and loops we go through is because of censorship resistance. That's the only way we know of to achieve censorship resistance. And so I'm gonna say the word censorship resistance a lot, a lot now. But the killer feature of Bitcoin is censorship resistance. It's not, it's not global transactions or it's not finite supply or anything like that. It's to, as if you ask me, it's the censorship resistance that's, that's it. That is the killer. And I want the reader to, to to have that as a main takeaway from the book. And every chapter, almost every chapter in the book, uh, solves a problem with censorship, actually. So every chapter tries to fix a censorship problem that we have with some technology to make it more censorship resistant. And after chapter 8, we have made a censorship resistant system. So that's, that's the main takeaway, I would say.

Yeah. And I, I agree that censorship resistance is the killer app of Bitcoin. That's the, that's the crux that makes it into Bitcoin, makes it relevant. Because otherwise you would just have some kind of another e-cash that can be shut down and, and that won't be very, very much useful to anybody. Right? Exactly. And, and this is unfortunately something that in so-called altcoins or shitcoin projects, like try to emulate and they take these buzzwords and those ideas, uh, to separate them from Bitcoin, which is a whole, you can't really, it's a game theoretical, you know, there's a lot of things, um, that come together in human psychology and incentive models, but without censorship resistance, it doesn't really do anything. Like it does not provide the service that it's, it's supposed to provide, which is to eliminate the trust in third parties. So we can begin to trust each other, you know? Yeah. Like, like with a free, free, you know, uh, limited in quantity but unlimited in utility, this kind of money. So it's fantastic. And yeah, I hope this is, well, it, it's after you read the book, it is quite obvious that, you know, this is the theme that keeps coming up and it's, it's not just your book, it's basically every, every, uh, in my opinion, valid book about Bitcoin. recognizes the censorship resistance. And I think Eric Worzkuhl writes, writes it well also in his Crypto Economics. It starts with the outlining the axiom of resistance, like, which is a prerequisite for understanding or even being interested in Bitcoin, in my opinion. Well, if you don't, I mean, some people are interested in just making fiat gains, so they buy Bitcoin and they flip it for fiat. That's, that's another separate thing. But to be able to understand Bitcoin, you have to kind of believe in the axiom of resistance that there can be systems that cannot be corrupted by, by a third party or cannot be controlled by somebody, and they are resistant. It can't be proven that it's, it's absolute, that it cannot be censored, but it is resisting censorship. And you have to kind of believe that based on the axiom that we have, we can derive from mathematics and, and probabilities. Yeah. Do you have a favorite part to share about the book?

Um, yes, I think I do. Uh, I think it's chapter 10 and 11. Chapter 10 is, uh, is about SegWit. Uh, it explains some problems that SegWit solves and then how SegWit solves those problems. SegWit was an update, update to Bitcoin that came in 2017 that solves, among other things, something called transaction malleability, which is a— I won't go into details of that, but, but, but I, I'm really, I'm really happy with how that chapter turned out. It's very, very, It's, it's of course very deep, but, but it's, I like the, I re— I, I really like the, um, the path of that chapter. Um, and the also the diagrams of that chapter. It's very nice. And I also like, you know, chapter 11. Um, chapter 11 kind of puts everything together into Uh, and talks about how to upgrade Bitcoin, hard forks, soft forks, and why soft forks are preferable to hard forks, uh, or according to some, the only actual option. Uh, uh, and it also comes to the conclusion of the, of the user-activated soft forks and how the users are Or the one who controls the rules of the system. I can read one little segment from the book. Please. It's from chapter 11 then. It's on page, in the English book, it's page 399, I think. There it is. So it's, it's about, it's about, you know, it talks about miners and users and there's, uh, there's this notion that miners somehow controls the system. Uh, but that's, that's not, that's not the case. So I say, I, I write, we pay miners to perform correct, honest transaction confirmations. We don't pay them to decide the rules. We pay them to follow the rules. The rules are decided collectively by everyone, you and me, by running our Bitcoin software of choice. And I think that, that kind of encapsulates the whole book. So that's, yeah. So those are the 2 chapters that I, I am most Uh, pleased with, I think.

Yeah. And for good reason. And, uh, just for the viewers and listeners, you know, uh, the transaction malleability. Malleability means like, for example, if you have a lump of metal that you, you can then, uh, melt and form into different shape, it's the kind of like the same content, atomic content, but it's in a different shape now, to give you kind of an idea what we're talking about.

Yeah. You, you can, you can, uh, change a transaction in subtle ways. without actually making it invalid.

Right, right. And that's a problem with the SegWit upgrade. I mean, the problem that SegWit upgrade fixes for us.

Yes, absolutely.

And yeah, the, the block size war that happened in, in 2017. And by the way, we are also translating that book. Have you read it by any chance?

No, I haven't. I haven't.

Me neither. I, I need to read it, but I hear it's a, it's a great account of of the history of how, how the, you know, block size were and what, what went down there. And basically the idea, just like you outlined there correctly, that we don't, you know, miners don't run the show, right? And, and this has been, I think still to this day, some people believe that miners somehow control the consensus rules when in fact it's, it's the case that Bitcoin, I'm, I'm not so sure if the users pay the miners, but maybe Bitcoin pays all of these players playing correctly according to the consensus rules that are then enforced by every single user, end users using their own implementation of the Bitcoin software on their own hardware nodes. And then of course the miners are also a player who, who will then have to make a choice. Do they follow the consensus of the rest of the nodes or do they try to hurt the system and then in that way undermine their own wealth generation system. So this becomes kind of like a, a Nash equilibrium where it is not beneficial to change the strategy or try to overtake the system. And with Knut, actually, I have to mention it because it was, it was so brilliant. Knut said it's like a, you know, universe Mexican standoff. Like imagine a Mexican standoff in a, in a universe where time runs backwards. I think that was interesting. That's pretty funny. Yeah. Um, is there anything else you want to, want to definitely add and talk about the book and, you know, make sure that people understand why is it a good book?

Um, not really. I'm, I'm just, uh, super happy the way it turned out with, uh, with the open source version. Uh, we have now the, the German version and the Finnish version. both open source based on my open source, uh, original. And I think that's a beautiful way to see people collaborating, uh, around a work like this, uh, without, without contracts, without, uh, uh, actually without payment mostly. And, uh, Just out of pure passion. And I think that's really beautiful.

Yeah, but I would say that, uh, you know, it's nothing is ever without payment. That's why we do those trades, you know, like also what, what Knut outlines in his books. And it's, uh, you know, that misses the rough part as well. You know, everything is a trade, right? Like every, every interaction is a trade. We have a positive outlook, uh, for the trade, so we don't just do it out of altruism necessarily. You know, personally, I'm accumulating information capital, this kind of like status capital in, in among Bitcoiners by doing these things that benefit the ecosystem. At least that is the intention. So, you know, I intend to, you know, that is kind of like my payment and I intend to leverage that payment going forward in this, in this scene and do other great things. So I wouldn't say that it's necessarily, maybe without the immediate payment in terms of money or monetary compensation. Sure, it's not extremely lucrative business to translate French language technical books. However, that is not that, you know, like Bitcoiners have the lowest of low of time preference. So I don't necessarily even think that this is going to pay off during my lifetime. I think I'm thinking already like a couple generations ahead, you know, what we are building there and And for that, information saturation is key. We have to have this information available to as many people as possible. And of course, we can't force it down their throat, but it has to be there. And that's why I find it so great that you chose to go the open source way. And I really encourage all the authors to think, you know, the long game, what we are doing here, because it does not undermine the possible or the prospect of Also short-term sales. In fact, it might make it even better because now people have a chance to, you know, get familiar with your work, with your book, you know, have a trial and then decide, okay, do I want to own this, put it in my shelf? And, and yeah, I think, I think it's a win-win situation, so please consider it.

Yeah, I totally agree on the, on the value part here. Uh, what's the value for me to translate the book? Uh, and It's obviously not always immediate monetary compensation, but other values that I value. Yeah, absolutely.

Yeah. And, and you know, the monetary compensation, I think it's just a matter of time, right? I mean, if we look at the, how popular this information is in total, like if you go to any mainstream media outlet and, and see what they write about Bitcoin, you start to realize how early we are and, and how it's, it's, it's not a surprise that it's still like a, You know, Bitcoiners are really fringe, like a, almost like a hobbyist group of people who are not being taken seriously globally. Not as, as of now. It might take still like 5, 10 years. We'll see how it goes. But once it does have, and it will happen, I think, you know, that will drive the, the demand for this information. That has been the thesis of Consensus Network from the beginning. You know, we're, we're looking at the 10 years minimum, you know, timeframe for this. And we are only 2, 3 years in, so we are only getting started and warmed up. And it has been encouraging how, how well received these services have been. You know, we already have like, uh, about 20 different titles across dozens of languages, uh, that we grew from one fringe language and, and one fringe, uh, topic. This is from 2019. So yeah, I'm feeling really bullish about the information distribution. I'm not going to stop anytime soon. I hope you're working on a, on another book.

You started out, you started out with the, the Bitcoin Standard, didn't you?

Yeah, that's correct. Yeah. Yeah. And the second one was Knut's Sovereignty Through Mathematics. And then I, I think the third one was probably already your book. And ironically, it's the one that is still not out yet because We've had a lot of trouble with that.

No, no, no. This, uh, that, that must have been the, the German version. Or did you start

actually? Well, actually we started with the Finnish version before the German version. That's, that's right.

Okay. I didn't know this,

but, but, but, but we got lucky with the, because Volker was doing the excellent job with the, with the translator and, and he did so much work on the figures and I, I just You know, uh, mostly the, the biggest hurdle for me was the typesetting, which is still, uh, you know, that, that part is already existing because of the, thanks to the German version. But now with the Finnish version, we also have to do all the figures ourselves. And it's, uh, it's just turned out to be a much, much bigger task than, than we anticipated. But I, I sincerely hope that we get it out by the end of the year, but I, I, I, I'm hesitant to promise anything.

Yeah. Yeah. You're doing a fantastic job. So thank you very much for all your work.

Thanks. And thanks for, for trusting me, Alex. Uh, it's an honor to be able to do this. So if you, if you don't have anything else you want to share about the book, or maybe, um, can I ask if, if you're writing another one? Um, are you, are you planning to write another book?

I'm not, and I'm not planning to write another book. Um, I was thinking about writing complementary chapters to Rocking Bitcoin for Taproot.

Okay.

I haven't, I haven't started that work yet, and I'm not sure if I, uh, will start. Uh, we'll see actually. Right now I'm doing my consultancy work. Um, so that takes up most of my time right now. And, um, I, so I, I honestly don't know. Well, that's all I can say.

Well, I guess we'll just see how it goes. Yeah. Yeah. Well, thank you for writing this book and I, I think it's, uh, it's going to be one of the classics in, in Bitcoin scene for sure. It's, it's like it fills the gap between maybe those super, um, very technical, um, programming books about Bitcoin and, uh, more broad historical philosophical books. Uh, for maybe at the moment a niche audience, but I think, uh, it's an increasing one.

Yeah. And that's the, that's my original goal as well, to fill that particular gaps. Yeah.

Cool. Very cool. All right. Um, do you want to tell our viewers, our listeners, if they want to get in touch with you, read maybe some of your, your tweets? Uh, you're on Twitter, right?

Yep. I'm on Twitter. You can reach me at, uh, Kalle Rothenbaum. In one word, or I'm I am Kalle at Mast and on Mastodon I'm Kalle at BitcoinHackers.org.

All right.

Please feel free. My DMs are open.

Excellent. Thank you, Kalle, for your time, and and thank you for viewers. Thank you for listeners. And if you're looking in the YouTube, remember to subscribe to us. Hit the bell button as well. Uh, because we're gonna keep making these, uh, authorcasts at least as, as long as we have authors left. Uh, so definitely hit the bell button and be, be notified when the next one is out. And yeah, this also, let it, let me know if you like this kind of, uh, format. I, I've been enjoying doing this. I would like some feedback as well if, if you enjoy watching them. So just let me know. And as always, you can find me. Uh, with OmniFin, both in, in Twitter and in Telegram. And my DMs are also there. And if you have an author or you have a book to recommend that we should, uh, distribute or, or get it translated in several languages, that's always something that I'm looking, looking forward to. So thank you for everybody. Thank you, Kalle, one more time. And I'll see you in the next one.