Crypto News

Rubin’s Reubens And The Push For CTV

Published

11 months ago

February 7, 2024

You may have noticed a new trend on bitcoin twitter lately, people changing their profile pictures to some form of a Reuben sandwich. I am going to explain what this means, why you should care and why you should consider also becoming a Reuben sandwich. First I must address something important, the Rubin’s Reubens images are not NFTs, they are not inscriptions, they are simply AI generated art that anyone can choose to use for free.

The name comes from Jeremy Rubin (@JeremyRubin), the creator of OP_CTV and BIP119, and the likeness between Rubin and Reuben. Which you may have already figured out. So by having a Reuben sandwich as your profile picture or by displaying the 🥪 emoji you are signaling your support for the CTV or more recently LNHANCE upgrade proposals. LNHANCE, which was written by Brandon Black (@reardencode) is a combination of OP_CTV, OP_CSFS and OP_INTERNALKEY. This combination provides a bit more flexibility and programmability than just OP_CTV alone, and enables extra things such as LN symmetry/eltoo.

In a previous article I explained that bitcoin has a scaling issue and that covenants, including CTV, can be a solution to help with this. However I didn’t discuss the process involved with how we actually activate these new OP codes. By design, it is not a quick or easy process to soft fork bitcoin in order to change the consensus rules. But what even is consensus? This is a tough question with a lot of nuance, and the answer will depend on who you ask. In the past there was a concept of rough consensus, where once the change is well discussed and there are no more reasonable concerns left to dispel regarding a proposal, you have reached rough consensus. Some people believe consensus is found when businesses, such as wallet providers, exchanges and miners agree on a change. Or even just the miners alone, as if you soft forked without a majority of miner hash support, you would be rejecting the blocks from the heavier chain, then it will be up to the market to decide which is the real bitcoin. This can be very messy and complicated, hence it’s much simpler if you can get the miners on board with the upgrade. The reality is that the economic majority of bitcoin users get to determine consensus, of which regular users, developers, miners, exchanges, wallets and other bitcoin holders all play a part. Measuring this is incredibly difficult, if not impossible. However you must try to judge the level of consensus for a proposal before attempting to activate it.

In April 2022 Jeremy Rubin proposed a speedy trial activation of CTV, this did not go well, and led to the fork being very contentious. Speedy trial is where the final decision whether to activate a soft fork proposal or not, is given to the miners. Just 5 months earlier taproot was activated using the same speedy trial method. However many people felt it did not go well, and they weren’t comfortable giving the miners the ability to say no to a change that may have majority consensus amongst the users. A couple weeks after Jeremy announced the speedy trial client he decided to call off the activation attempt. There was no consensus on CTV as a change in 2022. It is worth noting that Jeremy also released a tool for users to resist a CTV activation attempt (User Resisted Softfork) with the activation client. So now 2 years later the community is looking at another activation attempt, but this time there won’t be any speedy trial method.

So what are the alternative ways to activate a soft fork? There are 2 BIPs (Bitcoin Improvement Proposals) that are used for activation, BIP8 and BIP9, I recommend reading these. Taproot used BIP9 for the speedy trial, which relies on timestamps to know the signaling periods. If the signaling period ends without achieving the activation threshold, then the attempt fails and there is no soft fork. BIP8 uses block height to judge time periods and can be configured to either fail after a signal period without enough miner signaling, just like BIP9. Or it can be configured to activate after the signaling period, even without reaching the threshold. This parameter is called “lockinontimeout” or lot for short, when set to true the soft fork will activate no matter what. This forced activation is called a UASF (User Activated Soft Fork), and can only succeed long term if the majority of economic value in the bitcoin ecosystem agrees with the change and upgrades their nodes. Otherwise you won’t end up on the heaviest chain, as miners will follow the economic majority and not upgrade, but if you do have the economic majority supporting the change, miners will have to follow them due to economic incentives from the miners wishing to get the most fees possible. Ideally the miners will signal enough support before the end of the signaling period, and the drama of a UASF can be avoided. It was the threat of UASF that caused the miners in 2017 to agree to the Segwit upgrade and not increase the blocksize like the Bcashers wanted. (Yes, technically the blocksize did still increase a bit.)

We now need to briefly discuss activation parameters, these are the specifics of the activation, and includes the following: the name; the version bit number; the start block height; the signal period timeout block height; the minimum activation block height; the threshold of blocks signaling; and finally whether lockinontimeout is true or false. The name should generally just be the BIP number, in CTVs case, BIP119. The version bit can be any that isn’t being used already. The start is yet to be determined, I would hope it can be sometime in 2024, however this is a community decision ultimately. The signal period timeout should be at least 1 year after the start, some feel 2 or more years would be even better, again this is a community decision and the client developer must try and judge what the majority agree with, I would be happy with 1 to 2 years of signaling period. The minimum activation height is the earliest potential time that the soft fork could activate, this could be before the end of the signal period, at the same time as the timeout or after the timeout. I believe it should be at least 6 months after the start height. The threshold is how many blocks in a 2 week difficulty period, 2016 blocks, are required to activate through signaling. Generally this is 90 or 95% of the blocks, 1815-1915 blocks out of 2016. This means 90/95% of the network’s hash power must be signaling support for the upgrade in a 2 week period. Finally, as we already discussed, lockinontimeout should probably be set to true if you want the community to support the activation attempt.

So how do we get to a point of feeling confident we have found consensus? Engaging with the community, having conversations with bitcoin businesses and service providers, and signaling support online in various ways. Rubin’s Reubens is one example of this signaling, and it’s a fun and social way to do so. Don’t be afraid to ask questions about anything you don’t understand or agree with, remember, we verify around here not just trust. Engage with your favourite bitcoin businesses, ask them their opinion of CTV and be sure to let them know yours, after all, you are the customer. If you are a developer, you could review the code, or create a proof of concept for CTV. There is currently over 5 BTC up for grabs if you can create a positive proof of concept, or a negative that is harmful, plus any bugs found when using OP_CTV. This bounty has been around for more than a year already, with nobody finding any issues. You can find this bounty here: https://bipbounty.org/bounties/1e101655-bad8-5147-82f7-f03145d567af/.

Of course, in a decentralized system like bitcoin, we can never know for sure that the economic majority desire a change, we can only take a rough guess and hope for the best. We won’t find out until we try though. I believe we are either extremely close or have already found consensus for CTV. Make sure you head to utxos.org/signals and add your name or business to the list, you can signal yes or no. You will also find lots more information about covenants on this website.

This is a guest post by George 203. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

What’s the deal with all these sandwiches? They are a social signal in an attempt to build consensus around activating a change to Bitcoin.

Crypto News

You Should Not Wear This Bitcoin Shirt — Here’s Why

Published

13 hours ago

January 14, 2025

admin

Follow Nikolaus On &Xopf; Here For Daily Posts

Everyone has their own unique sense of style, but if you are wearing Bitcoin merch like the shirt in the X post below out in public — you should probably stop doing so.

This Bitcoin shirt is cringe as fuck.

Have fun getting 7 dollar wrench attacked. pic.twitter.com/zRlT2CFrIg

— Breadman (@BTCBreadMan) January 11, 2025

I agree with this post in that this shirt is cringe as fuck and will only bring unwanted attention.

Most people don’t understand Bitcoin and the lingo adjacent to it. If you’re wearing this out in public, the majority of people are not even going to understand it and will move on with their day, completely forgetting about it. So if you’re wearing the shirt, you’re not really flexing as hard as you think.

But some who will see you wearing it will know what it means, and this may lead to bad consequences.

Wearing a shirt that broadcasts to everyone that you own a full bitcoin (or basically $100,000, at the time of writing, in the form of a bearer asset) will likely just put a target on your back.

Don’t believe me?

This past November, the CEO of the Canadian company WonderFi was kidnapped and held for ransom. And more recently, a Pakistani crypto trader was kidnapped and forced to pay $340,000 to the kidnappers from his Binance account.

I’m not trying to scare anyone, but these things can happen, and you should at least avoid putting yourself in such a situation.

These criminals may or may not know how Bitcoin works, and it’s probably worse if they don’t. Because they might think you have it all on one exchange, or that you have your private keys located in one place that is easy to obtain, therefore thinking you are probably an easy target. And if you tell them you physically cannot give up your coins, and they don’t believe you, things could get ugly quick.

I’m not saying to never talk to anyone about Bitcoin ever or to be 100% secretive about it — I mean, I’m a public figure in this space and have thought through how to best limit the chances of something bad like this happening to me. The security of your bitcoin is important, but also is your personal security. Luckily for me, I am an American and have my second amendment rights. Protecting my Bitcoin from a potential $5 wrench attack is a lot easier with a firearm.

Upgraded my bitcoin security today by buying a Glock 19

— Nikolaus (@nikcantmine) December 26, 2020

If you are a proud owner of one full bitcoin, it’s fine to celebrate it, as that is a feat that most people on the planet will never be able to achieve.

My advice to you, though, is to celebrate it in a way that is more private, like with no one more than your family and very close friends that you trust. You can post online on X or Reddit anonymously about it if you really want to have a deeper conversation about it or to get the dopamine from all the other anons congratulating you on the accomplishment.

Don’t tell people how much bitcoin you own, and definitely don’t wear shirts that disclose it. Just stay humble and stack more bitcoin.

This article is a Take. Opinions expressed are entirely the author’s and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

You Should Not Wear This Bitcoin Shirt — Here's Why You are putting a target on your back by wearing merch like this.

Crypto News

Bitcoin DeFi Is Finding Product-market Fit With Runes

Published

14 hours ago

January 14, 2025

admin

Over the past year, the Bitcoin Renaissance has brought significant attention to BTCfi, or “Bitcoin DeFi” applications. Despite the hype, very few of these applications have delivered on their promises or managed to retain a meaningful number of “actual” users.

To put things into perspective, the leading lending platform for Bitcoin assets, Liquidium, allows users to borrow against their Runes, Ordinals, and BRC-20 assets. Where does the yield come from, you ask? Just like any other loan, borrowers pay an interest rate to lenders in exchange for their Bitcoin. Additionally, to ensure the security of the loans, they are always overcollateralized by the Bitcoin assets themselves.

How big is Bitcoin DeFi right now? It depends on your perspective.

In about 12 months, Liquidium has executed over 75,000 loans, representing more than $360 million in total loan volume, and paid over $6.3 million in native BTC interest to lenders.

For BTCfi to be considered “real,” I would argue that these numbers need to grow exponentially and become comparable to those on other chains such as Ethereum or Solana. (Although, I firmly believe that over time, comparisons will become irrelevant as all economic activity will ultimately settle on Bitcoin.)

That said, these achievements are impressive for a protocol that’s barely a year old, operating on a chain where even the slightest mention of DeFi often meets with extreme skepticism. For additional context, Liquidium is already outpacing altcoin competitors such as NFTfi, Arcade, and Sharky in volume.

Bitcoin is evolving in real time, without requiring changes to its base protocol — I’m here for it.

After a rocky start, Runes are now responsible for the majority of loans taken out on Liquidium, outpacing both Ordinals and BRC-20s. Runes is a significantly more efficient protocol that offers a lighter load on the Bitcoin blockchain and delivers a slightly improved user experience. The enhanced user experience provided by Runes not only simplifies the process for existing users, but also attracts a substantial number of new users that would be willing to interest on-chain in a more complex way. In contrast, BRC-20 struggled to acquire new users due to its complexity and less intuitive design. Having additional financial infrastructure like P2P loans is therefore marking a step forward in the usability and adoption of Runes, and potentially other Bitcoin backed assets down the line.

The volume of loans on Liquidium has consistently increased over the past year, with Runes now comprising the majority of activity on the platform.

Ok so Runes are now the dominant asset backing Bitcoin native loans, why should I care? Is this good for Bitcoin?

I would argue that, regardless of your personal opinion about Runes or the on-chain degen games happening right now, the fact that real people trust the Bitcoin blockchain to take out decentralized loans denominated in Bitcoin should make freedom lovers stand up and cheer.

We’re winning.

Bitcoiners have always asserted that no other blockchain can match Bitcoin’s security guarantees. Now, others are beginning to see this too, bringing new forms of economic activity on-chain. This is undeniably bullish.

Moreover, all transactions are natively secured on the Bitcoin blockchain—no wrapping, no bridging, just Bitcoin. We should encourage and support people who are building in this way.

This article is a Take. Opinions expressed are entirely the author’s and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

Bitcoin DeFi Is Finding Product-market Fit With Runes BTCfi is on track to compete with other ecosystems.

Crypto News

We’re Repeating The 2017 Bitcoin Bull Cycle

Published

15 hours ago

January 14, 2025

admin

The 2017 Bitcoin bull market was a wild ride, with prices soaring from under $200 to nearly $20,000. As we look at the current market, many are wondering if we might see a similar surge again. In this article, we’ll explore the data and trends that suggest we could be on the brink of another massive bull cycle.

Key Takeaways

The current Bitcoin cycle shows strong correlations with the 2017 cycle.
Historical data indicates potential for significant price increases.
Investor behavior patterns are mirroring those from previous cycles.

Understanding Bitcoin Bull Cycles

Bitcoin has had several bull cycles, each with its own unique characteristics. The most notable was in 2017, where the price skyrocketed. Now, as we analyze the current market, we see some interesting parallels.

The recent price action has been choppy, with Bitcoin hitting a new all-time high above $108,000 before retracing to below $90,000. However, it has since rebounded, and this fluctuation is not uncommon in bull markets.

Comparing Current Cycle to Previous Cycles

When we compare the current cycle to previous ones, particularly the 2017 cycle, we notice some striking similarities. The following points highlight these correlations:

Cycle Length: The 2017 cycle peaked at 168 days from its low, while the 2021 cycle peaked at 160 days. Currently, we are 779 days into this cycle, suggesting we have a significant amount of time left.
Price Action Correlation: The correlation between the current cycle and the 2017 cycle is at an impressive 0.92. This means that the price movements are closely aligned, indicating that we might be following a similar trajectory.
Investor Behavior: The MVRV (Market Value to Realized Value) ratio shows a strong correlation of 0.83 with the 2017 cycle, suggesting that investor behavior is also mirroring past trends.

The Role of Halving Events

Bitcoin halving events have historically been significant markers in the price cycle. The last halving occurred in 2024, and as we look at the current cycle, we see that it closely follows the pattern established in 2017. The halving events in both cycles occurred within a similar timeframe, which could indicate that we are on a similar path.

Future Predictions

Looking ahead, if the current cycle continues to follow the 2017 pattern, we could see a significant price increase throughout 2025. While some predictions suggest prices could reach as high as $1.5 million, it’s essential to approach such forecasts with caution. A more realistic peak might align with historical trends, potentially occurring in late 2025.

Conclusion

In summary, the current Bitcoin bull market shows strong correlations with the 2017 cycle, both in terms of price action and investor behavior. While we may not see the same explosive growth as in 2017, the data suggests that we could be in for an exciting ride in the coming months. As always, it’s crucial to stay informed and make decisions based on thorough analysis.

If you’re interested in more in-depth analysis and real-time data, consider checking out Bitcoin Magazine Pro for valuable insights into the Bitcoin market.

Disclaimer: This article is for informational purposes only and should not be considered financial advice. Always do your own research before making any investment decisions.

We're Repeating The 2017 Bitcoin Bull Cycle Explore the potential for Bitcoin to repeat the 2017 bull cycle. We analyze price action, investor behavior, and future predictions for Bitcoin’s market trajectory.