recap/history/1773185576199-YThlOTAyMWYtOTU4.json

{"id":"1773185576199-YThlOTAyMWYtOTU4","videoId":"a8e9021f-9587-4197-a1ab-820823d1e559","url":"https://serve.podhome.fm/episode/8029725b-0319-44b9-4793-08dc404e83a4/639086745068447337a8e9021f-9587-4197-a1ab-820823d1e559.mp3","title":"CD194: SIDESWAP - LIQUID PREDICTION MARKETS","type":"podcast","topicCount":13,"segmentCount":166,"createdAt":"2026-03-10T23:32:56.199Z","uploadDate":"20260309","chunks":[{"title":"Introduction & Citadel Dispatch Updates","summary":"The host introduces the episode, shares current Bitcoin metrics, thanks supporters, and introduces Scott from Sideswap.","entries":[{"text":"Host: Happy Bitcoin Monday freaks. It's your host Odell here for another Citadel Dispatch, the show focused on actionable Bitcoin and freedom tech discussion. The current block height is 840,011. That brings us into Fiat time. Fiat time, it's Monday March 11th, um they just did the timezone change on me, at 17:00 UTC, no, 16:00 UTC.","offset":0,"duration":46},{"text":"Um, you guys will probably be listening to this in a couple of hours. I don't like sitting on it, I like to get it to you ASAP. Current sats per dollar is 1,452. Current price in dollars is 68,863. And the current price in gold is one Bitcoin, you can get one Bitcoin for 12.84 ounces. Um, Bitcoin's down on gold on the day, the month, and the year, but we're slightly up on the week. Something to keep an eye on.","offset":46,"duration":52},{"text":"As always, Dispatch is supported by viewers like you. We have no ads or sponsors, so thank you to everyone who continues to send Bitcoin donations to support the show. The two largest supporters, I'm going to say from uh the last two weeks since, or the last two episodes since they were back to back, was we have Mav21, he sent two separate 10,000 sat zaps, both saying \"great rip\". Thank you Mav21, true ride or die.","offset":98,"duration":35},{"text":"And we have Captain Cook with 7,654 sats. He had no comment, but thank you for your support. As always, sharing with friends and family also goes a long way. Dispatch is available in all of your favorite podcast apps by searching Citadel Dispatch. All relevant links are at Citadeldispatch.com. And recently I've been playing around, I also launched Citadelwire.com where you can listen to the most recent Citadel Dispatch, the most recent Rabbit Hole Recap, um and get on demand news um from my soulless robot slave who I've been training and curating to try and provide the most relevant news using live market data.","offset":133,"duration":47},{"text":"Um, I got Poly Market plugged into him and Bitcoin prices and a bunch of other data sources, so that's a bit of a work in progress, but check it out at Citadelwire.com. Anyway, we have a great show lined up today. I have Scott here, he is the co-founder of Sideswap. Sideswap is, has just been grinding along building great product in the Liquid ecosystem. Something we haven't talked about for a while on the show. Um, how's it going Scott?","offset":180,"duration":32}],"startTime":0},{"title":"Introduction to Sideswap & Non-Custodial Swaps","summary":"Scott explains the foundational premise of Sideswap as a non-custodial wallet and swap market for Liquid assets. They discuss how the app facilitates easy swapping between regular Bitcoin, Liquid Bitcoin, and Liquid Tether.","entries":[{"text":"Scott: Hey Matt, uh thanks for inviting me. Yeah, uh everything's been going very well. Sideswap's been growing very nicely these past few years. Uh started out quite slow but we're growing organically and cash flow positive and um very happy with where we are. We focus much on the tech and building out what we hope is a great product liked by users. We don't focus much on marketing, which is why you may not have heard of us much.","offset":212,"duration":33},{"text":"Host: Yeah, so I mean, I was not really familiar with you guys. I like kind of a little bit a couple years back. Um, and then I started playing with Samson's Aqua Wallet, which more people might be familiar with, which is tries to do lightning um and Bitcoin with with Liquid as the base at rest. So it sits in Liquid and then it does swaps for receiving and sending. Um which we've seen a couple wallets do that.","offset":245,"duration":36},{"text":"Bolt Wallet has been doing it recently. Breeze has their own SDK that uses it as well. Breeze has like two rival SDKs in-house, one does Liquid and one does Spark. Um but I was playing around with Aqua Wallet and then I saw on the backend they were using you as the provider, which was cool. And then I was like, \"Okay well let me see what they're doing directly.\" And that's that's kind of how I was reintroduced to you guys and we had a mutual friend put us in touch and I it's just it's impressive what you guys have been quietly building with like you said, very little fanfare.","offset":281,"duration":39},{"text":"So I mean, to the freaks um to our audience here, what is Sideswap, how should they think about Sideswap?","offset":320,"duration":7},{"text":"Scott: Mm, well well Sideswap at its base is really a non-custodial wallet and it's based on the Bitcoin premise that your keys, your coins. So when we built the swap market, since Bitcoin doesn't have other assets other than Bitcoin on chain, we started looking at the layer twos. And since Tether was issued on Liquid, we figured we could build swap markets where we effectively have atomic swaps between two parties.","offset":327,"duration":32},{"text":"So you can create a bulletin board type of system and you trade a swap between the two parties so that settlement happens atomically and instantaneously real-time between the two counterparts to the trade. So we're never custodial of anything really, and that's a model that we're very much looking for. And the model we think everyone should really aim for and not go for the custodial model.","offset":359,"duration":34},{"text":"Host: So the correct- yeah, go on.","offset":393,"duration":2},{"text":"Scott: No no, you continue please, sorry.","offset":395,"duration":3},{"text":"Host: I mean, so the way I look at it is for the average person, at least on the surface, Sideswap is an app that you can download on your phone that lets you easily go from regular Bitcoin to Liquid Bitcoin and vice versa. And then if you want access to Tether, you can then easily swap between Liquid Bitcoin and Liquid Tether, correct?","offset":398,"duration":35}],"startTime":212},{"title":"Sideswap Mechanics: Order Books and D-Pix Adoption","summary":"Scott details Sideswap's peg-in and peg-out services, emphasizing their transparent order book system. They also discuss the surprising transaction volume growth from the Brazilian stablecoin D-Pix compared to Tether.","entries":[{"text":"Scott: Correct. So what one of the first big hurdles that we encountered was obviously getting people to move between the main chain and the Liquid sidechain. We effectively built one of these peg-in, peg-out services since very few people can be uh they they don't want to sit there and sync a full node on both the Bitcoin side and the Liquid side in order to be able to uh create the claim scripts and issue coins on Liquid.","offset":433,"duration":31},{"text":"And many of the services at the time had a very high fee, so we cut that down to 0.1% and had effectively a bridging service which anyone can use, which Aqua also uses. So um it's a 50-50 revenue split on anyone who's a partner and just uses our infrastructure, so they don't need to build it up themselves. And um with that done, uh we started focusing on the swaps on Liquid so that two participants can trade between themselves without having any intermediary.","offset":464,"duration":40},{"text":"So we effectively just offer a bulletin board system so that users can find each other and we and we help make sure that the swap has integrity, so that one party can't cheat the other one by effectively saving half-signed UTXOs which they could theoretically broadcast at a later date. And so the way we've built it, we also offer instant swaps but the way it's built we actually offer order books where anyone can come in and uh improve prices within the order book.","offset":504,"duration":34},{"text":"And any instant swap is effectively a market order into the order book. So dealers compete on pricing, um so hopefully we get spreads which become a lot tighter. Right now I think the spreads are about 0.2, 0.3% away from uh let's say the midpoint price many times. And um yeah, so there's lots of trading opportunities and lots of liquidity. The areas that we've really seen grow, initially it was a lot around um USDT but lately it's been D-Pix. It's really really grown in the Brazilian market.","offset":538,"duration":46},{"text":"Host: What is D-Pix? I saw it in the wallet.","offset":584,"duration":4},{"text":"Scott: Uh D-Pix is a Brazilian stablecoin uh issued by a company I believe called Ulem. So they have been behind much of the uh increase in adoption within Liquid lately.","offset":588,"duration":25},{"text":"Host: Fascinating.","offset":613,"duration":1},{"text":"Scott: Yeah, so if we look in our swap market just in terms of trades and transactions, I'd say D-Pix is probably the biggest market right now. Not in terms of volume, but in terms of transaction count.","offset":614,"duration":16},{"text":"Host: In transaction count D-Pix is the biggest, but in terms of total amount, Tether's still bigger?","offset":630,"duration":8},{"text":"Scott: Much bigger.","offset":638,"duration":1},{"text":"Host: Yeah.","offset":639,"duration":1},{"text":"Scott: People are a lot more comfortable holding Tether obviously.","offset":640,"duration":4},{"text":"Host: Yeah, they've been around for I mean, Tether's bread and butter is the high net worths, right? They've been around for a decade plus.","offset":644,"duration":9},{"text":"Scott: Uh exactly, whereas um I think D-Pix is many local payments within the Brazilian ecosystem, but it brings in a lot of users even if their transaction volumes aren't that large.","offset":653,"duration":16},{"text":"Host: How do I spell D-Pix?","offset":669,"duration":3},{"text":"Scott: D-E-P-I-X.","offset":672,"duration":3},{"text":"Host: D-Pix stablecoin. Interesting. So so okay, there's a couple things here. First of all, the order book thing is fascinating. It's like in general, a lot of these quote-unquote instant swap services you see are first of all custodial and second of all, they're kind of like a black box in terms of pricing. So it's cool that you actually have like a proper order book that basically anyone can participate in and become market makers. And as a result, it's more transparent pricing and theoretically, I guess, it should be better pricing.","offset":675,"duration":48},{"text":"Um I think it's pretty cool that you can actually participate in the order book on mobile, which makes accessibility good. But I assume it's quite obvious if you look at the order book for a little bit, like there's at least there's like one or two like real market makers there that are putting up more size than others. Are they using- they're not using like a mobile wallet, right? Like they is there like a CLI or something that they're accessing the order book with?","offset":723,"duration":36},{"text":"Scott: Uh we we've built quite a suite of tools. So in our GitHub repo, anyone can download the dealing software and if anyone needs help setting things up, um everything's available and you can yeah, run your own frontrunning code. So um I think we had a bit of an issue with that at one point since people were flooding the system with lots of quotes. But um yeah, growing pains like are good pains.","offset":759,"duration":35}],"startTime":433},{"title":"Liquid's Privacy, Confidential Transactions, and Tether","summary":"The conversation shifts to Liquid's slow adoption and how its confidential transactions offer superior financial privacy compared to Tron or Solana. They discuss why Tether adoption on Liquid remains relatively low despite its unconfiscatable nature and payjoin capabilities.","entries":[{"text":"Host: Yeah, I agree with that. Um okay, fascinating. I mean, before we continue on, I mean, I think the big question that we've been asking on this show for years now um and I think Bitcoiners have been asking for a while is ironically the lack of liquidity on Liquid and the lack of users using Liquid. It seems like cautiously optimistic in terms of adoption increasing lately, and I would say partially it's probably these wallets that are using Liquid at rest for Lightning payments, specifically Bull and Aqua Wallet.","offset":794,"duration":44},{"text":"I mean, the fact that Liquid has confidential assets which incorporates confidential transactions, so each transaction you can't see the amount or the asset that's being sent, whether that's Bitcoin or Tether or whatever, um means that people that, you know, maybe are in the developing world that are sending um 20 cents worth of Bitcoin, you can't tell if that's $2,000 worth of Bitcoin or 20 cents worth of Bitcoin. So it actually compounds kind of beautifully in terms of adding, I guess, anonymity set to to Liquid.","offset":838,"duration":50},{"text":"Anyway, this is kind of a long-winded question, but where do you see Liquid adoption? Have you been frustrated with the lack of adoption? Do you- are you still opti- I mean, I assume you're still optimistic on adoption and how can that be accelerated? Because it kind of feels like Liquid has always been like the ugly stepchild of Bitcoin that just hasn't really found its wings.","offset":888,"duration":27},{"text":"Scott: No no, correct. I think much has to do really with Bitcoin being a one asset chain, it didn't really have any scripting abilities or or ability to issue other assets so that you could trade things like atomically. So so there was no real layer two which could really scale Bitcoin. So I think when all of these other chains came around and they offered all the smart contracts etc., very easy for anyone to get involved. I think that took out took off a lot.","offset":915,"duration":37},{"text":"And many of the exchanges I think focused on offering products and development within that area since there's a lot of money flowing in and promise. But I think as time goes on, I think Bitcoin which is like the settlement layer, developed properly and financial markets, it may have taken a bit more time. But I think Liquid is a step in the right direction in terms of how you build secondary layers. There's lots of questions around the making the two-way peg trustless and how you can go about that and the federation model and- but if we skip that side of the discussion, it's very nice to have an asset layer which is like Bitcoin-based, UTXO-based, that can hold multiple assets so that you can have these financial transactions, the swaps and everything else around it.","offset":952,"duration":55},{"text":"So I just think that side has taken a lot of time to get going, especially since it requires you to manage your own keys. I think none of the big wallet custodians like Fireblocks or anyone else has integrated Liquid so it hasn't been very easy for any exchange to offer it. So it basically onboarding one by one people are comfortable to holding their own keys. But going forward, I think now that Simplicity is live on Liquid, uh I think there's a lot of things that can be done and will offer a lot of fantastic features to users such as being able to create prediction markets in a Bitcoin-native type of ecosystem.","offset":1007,"duration":52},{"text":"Host: Yeah, I mean I want to jump in there specifically on the prediction market stuff, but before we do, just real quick I mean like my fascination with Liquid has always been on the privacy side, specifically confidential transactions. Um you know, a lot of the probability analysis that Bitcoin chain surveillance firms do is based on amount correlation. And once you remove those amounts from being visible, it makes their job of detecting when ownership has changed hands much more difficult.","offset":1059,"duration":52},{"text":"On the asset side um let's be frank, I think most tokens that have been launched in crypto are just straight up scams and the ones that aren't are also just probably horrible investments except for the undeniable US tokens, specifically Tether, right? And we've seen a massive market for Tether on Tron specifically, to a lesser extent on Solana and Ethereum. Um and it's fascinating to me because if you use those ecosystems, it's even worse than Bitcoin privacy. It's like you have a fixed address that is literally your entire transaction history.","offset":1111,"duration":69},{"text":"And so where I'm going with this is right now it seems like I'm cautiously optimistic that financial privacy in quote-a-quote broader crypto space seems to be having a moment. First we saw it kind of with the Zcash pump and dump and then recently Ray Dalio and Chamath both mentioned financial privacy as a concern. And I think part of it is because of of not even Bitcoin like Bitcoin could have better privacy but it's still relatively accessible. But the privacy situation on a Tron or a Solana is absolutely abysmal. It's horrible.","offset":1180,"duration":51},{"text":"Um so I'm surprised that there hasn't been more uptick on just the Tether use case. Like if you want to use Tether, which obviously has a trusted third party and I've never advocated for people to use Tether but there's plenty of demand for people that want Tether and want access to US dollars where they can't get it otherwise. The most private way to access Tether is through Liquid and specifically through Sideswap because you make peg-ins so easy um and peg-outs so easy and you make the ecosystem much easier, much more accessible.","offset":1231,"duration":48},{"text":"Why do you think we haven't really seen like like let's nail down specifically on Tether like why haven't we seen specifically massive Tether adoption on Liquid? It's like it's pretty much negligible compared to the other chains.","offset":1279,"duration":19},{"text":"Scott: It- it's absolutely nothing. I think there was about $35 million of Tether circulating on Liquid up until a few months ago when it when it was increased to 90-something million. So if you compare that to the other chains it's a drop in the bucket. Well- I think also much of the liquidity on the other chains uh is not really held in private wallets, it's held with custodians in one shape or form. Um with Liquid, since there are no custodians, um effectively people who are comfortable holding their own keys and assets, Bitfinex effectively custodying the balances for you.","offset":1298,"duration":52},{"text":"But something that's very interesting, which few people might have considered, is that USDT on Liquid, it's the only- due to the confidential transaction nature of it, the issuer cannot confiscate the balance. They- they don't know which UTXOs are USDT.","offset":1350,"duration":20},{"text":"Host: Yeah they'd have to confiscate it basically they'd have to like basically shut down Tether on Liquid is what they could do. But they can't do their like pick and choose \"I'm blocking this Tron address\" or whatever.","offset":1370,"duration":17},{"text":"Scott: Not like they can do on the other chains.","offset":1387,"duration":2},{"text":"Host: Yeah, that's why it's wild to me that just the Tether use case alone has- and so okay, they have a website USDT.network that tracks all of their usage across the different chains. Just just for reference for the freaks. I mean Scott said, what'd you say, you said 95 million Tether on Liquid?","offset":1389,"duration":22},{"text":"Scott: Yeah, I believe it's about- in that ballpark area.","offset":1411,"duration":5},{"text":"Host: Okay, well anyway it's completely negligible. The- there's $92 billion worth of Tether on Ethereum, $85 billion on Tron, just to with a B, just just to show the discrepancy. On the privacy side, I think it's also pretty cool that basically in practice, am I correct in saying that anyone who's doing a swap between Tether and Bitcoin, Lightning Bit- Liquid Bitcoin and Liquid Tether, is basically a payjoin transaction. And payjoin works even better on Liquid because of confidential transactions than it does on Bitcoin in terms of breaking probability analysis.","offset":1416,"duration":78},{"text":"Scott: I think there's a few different aspects to that. Um payjoin is something that we offer for people who have wallets where they don't have Liquid Bitcoin and need to pay the network fee. So- so we do lots of payjoin transactions every day. I think there's about 2 or 3 cent fee which covers- includes the network fee. So- so it's very cheap to do these payjoin transactions.","offset":1494,"duration":40},{"text":"And um when we have swap markets where you have two assets traded against each other, um where you don't have Liquid Bitcoin as one of the assets, we actually pay the network fee on behalf of the user in a payjoin with the swap. And since the swap there's two different assets being exchanged, it's very very little- the heuristics become very very difficult to- yeah, it's pretty wild, and particularly at a small user base, which is obviously the single biggest thing holding back Liquid as a as a more robust privacy tool. But it's impressive that it breaks it already breaks even at a smaller usage, it still's breaking a lot of heuristics. It makes it quite difficult.","offset":1534,"duration":66},{"text":"Yeah, and especially with the peg-in, peg-out process when you peg in and then you peg out, the federation also selects the UTXOs that you get when you peg out so there's no correlation between the two.","offset":1600,"duration":16},{"text":"Host: Right. They just know it came from the Liquid network. Like if you pegged out and then sent to Strike, they would know that those are Liquid-affiliated transactions but there wouldn't be a direct connection between peg-in and peg-out.","offset":1616,"duration":18},{"text":"Scott: But mind you, this was like two, three years ago, we we ran the UTXO set of Liquid through one of the chain analysis tools, and the UTXO set is effectively pristine since Bitfinex is responsible for um a decent chunk of it.","offset":1634,"duration":22}],"startTime":794},{"title":"Building Bitcoin-Native Prediction Markets","summary":"The host highlights the flaws in centralized prediction markets like Poly Market, advocating for a self-custodial, Liquid-based alternative. Scott explains how they are adapting their order books and using Simplicity to fund binary contracts, while acknowledging the unresolved oracle problem.","entries":[{"text":"Host: Fascinating. Oh yeah, I mean yeah let's talk about I mean you mentioned it, let's talk about prediction markets. I mean to me one of the big shames is that we I mean Bitcoiners have been talking about prediction markets for over 10 years now and they finally hit critical mass and the biggest one is on Polygon and uses USDC as its primary base asset, um that being Poly Market.","offset":1656,"duration":42},{"text":"Obviously like the functionality specifically with something like prediction markets, you need it to be self-custody, you need to not have liquidity concerns. These things make it very difficult to run any kind of prediction market on Lightning. We've seen a competitor pop up called Predics that is basically just a custodial wallet, you know, with managed payouts, which I think is just not sustainable or scalable, um and has massive, you know, regulatory exposure.","offset":1698,"duration":37},{"text":"Liquid seems like it could be ideal for a Bitcoin-native prediction market because it has simplicity, because you can do self-custody type smart contracts, because you have privacy. I mean we're seeing on the Poly Market side people's wallets are being tracked. They're like, \"This person was successful on these six different military markets, like they must be an insider with the Israelis or an insider with the US\" or whatever. Like it's getting arguably as it's made it more obvious why financial privacy is important on blockchains than actual financial transactions themselves because a lot of these markets are quite sensitive. So how are you thinking about prediction markets, Liquid, what kind of opportunities are there?","offset":1735,"duration":89},{"text":"Scott: Um well I think there's many aspects to your question. The first point you raised now with the insider trading ahead of the Iran, where someone seemingly made quite a bit of money betting on the 28th I believe. Um in terms of prediction markets being built on Liquid, I think it's still a bit out. We've done so much work in the background because there's so many building blocks that need to come into place before you actually build it.","offset":1824,"duration":33},{"text":"So what we've been building in the background is effectively a Liquid Connect type of function so that anyone can plug their wallet into a web page or that the web page can connect with a wallet so that you can send these transactions to the wallet directly because these swap transactions, especially with Simplicity contracts, can become shall we say fairly messy, non-standard, not super easy to do. So it requires a bit of work in that regard, a bit of like Metamask type of features but for Liquid.","offset":1857,"duration":51},{"text":"So we we've done much of that work, hopefully should be I mean we have it ready and in production but it should be a lot more useful I think next week. And we should release um a public API so that anyone can integrate. But um so that was the first step and then the second step is how do you build these prediction markets? So with Simplicity you can build these binary contracts and we've started playing around with it.","offset":1908,"duration":38},{"text":"I'm still not entirely sure all of the limitations, you can create these binary contracts um between two people and you have an oracle that determines the outcome um of the contract. So as long as the two parties trust the oracle, you can effectively bet on anything. But- but then the question becomes also how do you get people to fund the contract at the same time?","offset":1946,"duration":30},{"text":"Because if you create markets where someone needs to fund the contract initially and then someone funds the contract at a later date, you need to create some form of market structure that allows for that. What- what we've done is we've applied our order book and our swap market to it. So we're looking at creating markets where you have a instead of an order book that goes from with a Bitcoin price say from wherever it is now um $70,000. So you have an order book that goes from 0 to 100 effectively.","offset":1976,"duration":47},{"text":"And so the bid will be the yes outcome and the offer will be the no outcome. And wherever you bid within that order book is the prediction rate. So- so whoever's on shall we say the yes side, it bids 30 um they fund the contract with 30 cents and the offer will need to fund it with 70 cents. So that there's one full dollar in the contract and once the contract um once the prediction either comes true or false, when the oracle has a definite outcome, it's a winner-take-all type of situation where everything goes to one of the two parties.","offset":2023,"duration":50},{"text":"And that's effectively how you price it. So with our order book structure, we can create that so that two parties enter into a swap at the same time and that the contract is funded with the swap at once. So that you don't have the issues of who goes first etc. funding a contract and creating an order book with resting orders and people having locked up funds waiting for other users to come in etc. etc. To be honest, I'm not sure how Poly Market's done it. I know their order book's quite efficient but the question is how does it actually work under the hood?","offset":2073,"duration":43},{"text":"Host: I'm pretty sure they're basically trading yes and no tokens on each market has their own token. I mean the user doesn't see it.","offset":2116,"duration":10},{"text":"Scott: Mm, that's one option of going about it but the other option is creating the contract directly and you have the two users fund the contract.","offset":2126,"duration":12},{"text":"Host: Yeah, there's a couple different things right? Because it's like okay with prediction markets for prediction markets to work at scale you need a couple things. You need uh you need the ability for people to participate anonymously because the whole idea is trading prediction markets benefits insiders, tracking and watching prediction markets benefits outsiders because you're giving insiders an incentive, a financial incentive to effectively tip their hand and and trade a market which then exposes um which exposes their belief on how that market will what the outcome will be.","offset":2138,"duration":51},{"text":"So they need to be able to do it anonymously because if they work for Intel or if they work for a government or something they're not going to do it unless they can do it anonymously. So with that understanding, then it needs to be at least relatively decentralized and self-custodial because if there's a single company that is controlling funds and controlling payouts, then they're ultimately going to be pressured by a government to dox all users. So you're never going to have permissionless participation unless it's relatively decentralized.","offset":2189,"duration":44},{"text":"And then the last piece is the oracle problem, which is how do you how do you determine in a um robust and objective way what actually happened to settle the contracts afterwards. And so Poly Market like kind of made it there on all of those pieces but they kind of hand-waved a bunch of stuff away. Like Polygon itself, you know, I think could be argued that it's still pretty centralized. Ethereum very centralized. USDC obviously is completely centralized and can be frozen at will.","offset":2233,"duration":52},{"text":"Um the oracle problem they haven't actually solved, they just offload it. It's like they don't make the decision, they have like for each market there's a designated quote-a-quote on-contract oracles so there's it's still crypto-native if you will but it's still ultimately, you know, centralized entities saying ESPN reported that the game um was, you know, the Clippers won the basketball game or whatever.","offset":2285,"duration":32},{"text":"Uh so they didn't solve the oracle problem and they're like quote-a-quote decentralized enough to not have to do KYC and block people's access to markets. Um and I think this is just something interesting by the way for Bitcoiners and Liquid where the shitcoiners have done a really good job of kind of being pragmatic about tradeoff balance when it comes to censorship resistance and decentralization that Bitcoiners have not been.","offset":2317,"duration":22},{"text":"I mean I we haven't really touched on it but there's a lot of controversy for instance around the Liquid Federation model and whether or not it is technically self-custody or not. But if you which is something that's I think unique to the Bitcoin community because if you look at something like Tron, it's pretty much the same trust model as Liquid but Tron has gotten a pass from regulators, they consider it decentralized enough. And Tron, like I said earlier, has $85 billion of Tether volume alone on it, which is a wild stat.","offset":2339,"duration":35},{"text":"So to me Liquid could be this middle ground for Bitcoiners. And we could actually I mean there could actually be a trust model set up on a Liquid-style prediction market that is significantly better than Poly Market, which is right now operating at scale with very sensitive markets at a $10 billion-plus valuation with many many users. And it seems like too good of an opportunity to to miss out. So I mean on that point, that was very long-winded, but you more than anyone, you know you've been quietly bootstrapping and building a business on Liquid, how do you think about that trust model in terms of the federated model? Because I mean it could kill your business if if it wasn't um sufficient enough, let me put it that way.","offset":2374,"duration":45},{"text":"Scott: Of course, and that's also one of the growing pains that we'll need to encounter at some point. But right now while we're so small, I I think no one's looked um deeply enough at all of these questions in terms of Liquid, the Federation, how it's structured set up, is it decentralized enough etc. etc. Uh right now we're very much just focused on getting the market model correctly, getting everything easy for users to access, make it easy to trade.","offset":2419,"duration":29},{"text":"Since everything's non-custodial, you hold your own wallet, you hold your own keys, the contracts are on chain, you swap into it can be verified uh within the wallet by the users prior to executing the swap. But then there's all the ques- so the question is is that decentralized enough? It's very difficult to say, like different regulators may take a different view given the Liquid governance model very unclear.","offset":2448,"duration":29},{"text":"Um then there's I think all the questions around how the oracle is constructed etc. We're not trying to solve all of these like shall we say philosophical or mathematical questions right now, we're just focusing trying to get the market structure correct. And once we have that in place, we can start tinkering around the edges with everything else. I think the oracle problem's not super easy to solve. Blockstream's working on it, they they have a model that they've proposed. Um is that good enough? Not sure.","offset":2477,"duration":34},{"text":"Host: I mean, like I said, it's not like Poly Market has solved it. It just needs to be robust enough. It's never going to be- we're not going to- I'm convinced that the oracle problem is is unsolvable. You can mitigate it, you can create a relatively usable and decent and robust solution but actually quote-a-quote solving the oracle problem, solving something happening in the real world and then being able to cryptographically prove it on chain is going to require some trusted third parties that are cryptographically proving it on chain.","offset":2511,"duration":45},{"text":"Those trusted third parties, you can reduce their influence or risk by combining multiple of them, by adding reputation systems. I think DLCs are interesting where they're providing oracles but they don't know which market they're providing oracles for. There's different ways you can do that. But at the end of the day, for someone on chain to know what the weather was in Chicago yesterday, like there's going to be trusted third parties. There's I- I don't think it's solvable in that regard.","offset":2556,"duration":15},{"text":"Scott: There's no way around it I think.","offset":2571,"duration":2}],"startTime":1656},{"title":"Evaluating Trust Models: Liquid vs. Tron","summary":"The host and Scott debate the tradeoffs of Liquid's federated trust model against other scaling layers and networks like Tron and Spark. They emphasize that while pure self-custody is ideal, secondary layers inherently involve complex decentralization tradeoffs.","entries":[{"text":"Host: Yeah, exactly. And on the on the point of Liquid, I mean would you agree with me like if Tron is self-custody, if you consider Tron self-custody, I think you have to consider Liquid self-custody. I mean Justin Sun is basically the arguably the model for Tron is worse than Liquid in terms of censorship resistance and trusted third parties.","offset":2573,"duration":17},{"text":"Scott: I- I would say so, obviously I'm biased, um my hope as well is in that direction so take it from what it is.","offset":2590,"duration":9},{"text":"Host: I will say that I think um where we're seeing, I mean the big one that everyone is I mean anyone who's actually building in the space has been paying attention to is Spark. Um and there's a lot out of Lightspark, which is David Marcus's A16Z-funded company after he was formidably working for Facebook for Meta. And I'm already seeing like the Bitcoin culture fights over whether or not that is considered self-custody. Um and it's a similar idea of a pragmatic approach that is maybe more similar to what we see in shitcoin land but I think could be very useful for Bitcoiners.","offset":2599,"duration":37},{"text":"Yeah, and I wonder if that will bring more attention to Liquid because I mean if you mono-a-mono it out, I think the Liquid model is more robust than the Spark model. Um and then you have other things, I love the Phoenix team with Async. Um like the trust model for that is not as clear cut as you hold your keys, you have self-custody. On-chain is very clean. On-chain Bitcoin's very clean, it's either self-custody or it isn't. Once you start playing with the tradeoff balances across the stack, things get a little bit more definitionally messy. And I think the Bitcoin community specifically has been wrestling with that for many years now.","offset":2636,"duration":41},{"text":"Scott: Well- I mean if you look at how the financial system is built, you effectively have a central bank they they operate one ledger. Uh then you have all the commercial banks below, they each operate their own ledger. So if you want to move cash from one one bank to another, it's actually the bank's accounts at the central bank that need to be updated before the banks themselves update their own accounts. So the whole financial system is built on lots of different ledgers and all these clearinghouses are effectively the ones managing the risks between the different ledgers and um shall we say the net deferred settlement between ledgers.","offset":2677,"duration":37},{"text":"So for Bitcoin to scale given that it is a one-asset chain, you need these secondary layers somehow. Since there's no solution yet exactly of how to create these exact or trustless two-way pegs between the Bitcoin main chain and a sidechain, that there is always going to be these different tradeoffs and discussion around how decentralized it is, at what point do the regulators consider it being decentralized or not. So there's always these questions.","offset":2714,"duration":34},{"text":"Host: Yeah of course. It's just an interesting it's an interesting um interesting thoughts to go down. Um I'm sure we're going to get comments about it too which is why it's incredibly important to talk about it. Um pretty much they come up anytime Liquid is brought up. And I think rightfully so. I think it's good that the community is at least a subset of the community, which percentage-wise is getting smaller by the day but absolute numbers-wise has never been higher, cares so much about these hard questions and sovereignty and and using these things in freedom-oriented ways while like like I said, like shitcoiners kind of just throw it out the window and think of it as an afterthought. You guys recently launched a new product. Are you at liberty to talk about it right now or?","offset":2748,"duration":53}],"startTime":2573},{"title":"Introducing Swaption and Liquid Connect","summary":"Scott unveils Swaption.io, a proof-of-concept platform featuring binary outcome contracts for Bitcoin's price. He also introduces Liquid Connect, a tool that allows users to link their Liquid wallets directly to web applications.","entries":[{"text":"Scott: Yeah, sure. Um so this is like our first dipping our toes into the Simplicity uh shall we say pool if we're in the Liquid space. But- but what we've effectively what- we have this website or sister website called Swaption, uh where we've plugged this Liquid Connect which is a bit of a privacy dox since if you do connect you share the watch-only wallet with Liquid Connect because otherwise it wouldn't be able to help you create the transactions and everything within your wallet and send the transaction for signing to your wallet. So there is that aspect to consider.","offset":2801,"duration":39},{"text":"Host: Would you- similar to the tradeoff with using like an Electrum server right? On-chain Bitcoin.","offset":2840,"duration":5},{"text":"Scott: Uh yeah. No no, exactly.","offset":2845,"duration":3},{"text":"Host: Right, okay, continue.","offset":2848,"duration":2},{"text":"Scott: There is that tradeoff. Um I mean, we never data mine our users or anything else. Uh so- but I mean, there's no way for users to verify that. But- but in terms of Swaption, so with the Liquid Connect function that we've developed with the wallet, if you visit the Swaption webpage, what we've built is the first binary outcome contracts, which is the first step in the direction towards prediction markets effectively.","offset":2850,"duration":29},{"text":"So we have two different products. One is \"Will the Bitcoin price be higher or lower in shall we say two, five or ten minutes than it is now?\" Um and then the other product is \"Will the Bitcoin price of Bitcoin go up or down like 1, 2, 3, 4 or 10% first?\" So it's a binary outcome, does it go up or down 10%. So people can make a bet in terms of direction etc., hedge positions um with leverage.","offset":2879,"duration":27},{"text":"So the idea was also here to open up so that anyone can trade in the order book and provide liquidity and improve prices etc. So right now there's not fantastic payouts but we're working very hard in that direction to create these order book type of markets so that anyone can come in and provide liquidity.","offset":2906,"duration":19},{"text":"Host: So I mean, your main website is sideswap.io?","offset":2925,"duration":4},{"text":"Scott: Correct, that's- that's where you download the app and the webpage is being reworked as well, so soon you'll be able to use the Liquid Connect and trade via the webpage as well.","offset":2929,"duration":10},{"text":"Host: And then Swaption is- is it swaption.com?","offset":2939,"duration":3},{"text":"Scott: .io.","offset":2942,"duration":1},{"text":"Host: swaption.io. And then that's S-W-A-P-T-I-O-N. Um I'll put all these links in the show notes. And then Liquid Wallet Connect is basically I have the Sideswap app on my phone or another compatible Liquid wallet, which I don't think there are any right now?","offset":2943,"duration":15},{"text":"Scott: Yeah, none.","offset":2958,"duration":1},{"text":"Host: Yeah. And then I'm like scanning a QR code on the website to sign in basically, right?","offset":2959,"duration":4},{"text":"Scott: Correct, or if you have a desktop wallet, it will detect the desktop wallet with the browser.","offset":2963,"duration":6},{"text":"Host: Do you have a desk- Sideswap has a desktop wallet too?","offset":2969,"duration":3},{"text":"Scott: Yeah. Well we've built everything in Flutter, so it's very easy to go cross-platform.","offset":2972,"duration":6},{"text":"Host: And then so you're saying this is kind of in a lot of ways it's kind of a proof of concept because it's a relatively simple type of market that you could have compared to a prediction market.","offset":2978,"duration":9},{"text":"Scott: Exactly. So we're dipping our toes, this is like the first MVP that we push out. There's only one dealer we don't allow yet, but that's coming, that anyone can compete and improve prices. Um and then the next steps are obviously developing these open order books so that anyone can come in. Maybe add functions such as auto-signing etc. in the Liquid Connect so that users don't need to sign every transaction so it becomes a bit more Poly Market-if you will.","offset":2987,"duration":31},{"text":"Uh so there's lots of these thoughts in terms of different directions we can go. We'd love for Aqua and other wallets obviously to integrate so that it becomes ubiquitous within the Liquid ecosystem. Liquid Wallet Connect.","offset":3018,"duration":11},{"text":"Scott: Yeah.","offset":3029,"duration":1},{"text":"Host: No that makes sense to me.","offset":3030,"duration":1},{"text":"Scott: But it's developed by us so- so it's called Liquid Connect but let's see if others pick it up or if it's actually Sideswap Connect.","offset":3031,"duration":8}],"startTime":2801},{"title":"Permissionless Asset Listing and Network Effects","summary":"Discussing the importance of open standards, Scott explains how other wallets have integrated Sideswap's infrastructure through a revenue-share model. They highlight the Cypherpunk nature of Liquid, where assets like D-Pix can list permissionlessly without exorbitant fees.","entries":[{"text":"Host: Fair enough. Um I mean we kind of have a similar situation in the Nostr ecosystem where we have an open standard called NsecBunker that uses you either paste a code or or use a QR code scan, I think QR code scan makes a lot of sense if like the user has a mobile phone, they're like scanning it with a QR code. But the reason I bring it up is because we integrated it into Primal, so it works with any Nostr website that has this standard set up but we are seeing people like add like some people frame it as \"Sign in with Primal\" even though it's an open standard technically anyone else can have NsecBunker support, which is important I think.","offset":3039,"duration":32},{"text":"I mean, you know, I think part of the challenge you guys have had is it seems like you've been building quality product but you need other people to also be building around you. You need more wallets. You need more hardware wallets, it's just Jade right now right? You need more use cases.","offset":3071,"duration":17},{"text":"Scott: There's quite a few others who have integrated like different types of service providers, different wallets. Um mainly actually in the Brazilian ecosystem around D-Pix. And anyone who integrates with us we offer a 50-50 split on any volumes they drive our way. Uh so it's a very easy way for them to build wallets not have to develop all the swap market infrastructure etc. They just plug our stack and then we split the whatever trading fees 50-50. So it makes a lot of sense for them as well and it helps us build network effects around our markets so that we get deep liquidity.","offset":3088,"duration":44},{"text":"Host: Yeah, I mean liquidity begets liquidity. It's like the hardest network effect to to tackle but once you get it-","offset":3132,"duration":6},{"text":"Scott: Yeah.","offset":3138,"duration":1},{"text":"Host: What- like where'd the D-Pix guys come from? Was that a why'd they choose Liquid? That's pretty-","offset":3139,"duration":6},{"text":"Scott: That's a very good question. Um I'm not quite sure. I actually think one of the aspects was that one of the premises of the Sideswap swap market is that any asset you hold in your wallet you can post on the bulletin board and create markets for. And we have all this dealing software that we offer for free so that anyone can create liquidity in whatever asset they have.","offset":3145,"duration":18},{"text":"Host: So did they start using you without even talking to you or was there a conversation?","offset":3163,"duration":4},{"text":"Scott: There was no conversation until they arrived, which is-","offset":3167,"duration":2},{"text":"Host: That's kind of awesome. That's super Cypherpunk.","offset":3169,"duration":2},{"text":"Scott: And um but moreover, since we don't charge any listing fees or anything else, so if they went like on in the Tron ecosystem if they want to get listed with Binance what would that cost to list their coin and millions of dollars?","offset":3171,"duration":-48},{"text":"Host: Millions of dollars.","offset":3123,"duration":62},{"text":"Scott: It- it wouldn't- it wouldn't work. So the barriers to entry I think in Liquid are so low because anyone can issue assets and if you trade through Sideswap there's absolutely no gatekeepers at all. Anyone can create order books for whatever product they have.","offset":3185,"duration":13}],"startTime":3039},{"title":"Understanding Simplicity Smart Contracts","summary":"Scott provides a high-level overview of Simplicity, a mathematically provable smart contract language native to Liquid. He contrasts its robust, conservative design with Ethereum's smart contracts, noting its potential for secure financial derivatives.","entries":[{"text":"Host: That's pretty cool. Um I mean you mentioned Simplicity and Simplicity is a smart contract language that Blockstream championed for Liquid with the the hope I think that one day it could be used on Bitcoin on-chain as well. Ironically, given the name, it's actually not that simple to get your head around. Do you have a high-level explanation of why Bitcoiners should care about Simplicity?","offset":3198,"duration":31},{"text":"Scott: Well I think high-level abilities for Bitcoin to have different types of scripting options were like limited to like timelocked contracts, hashlock, etc. There wasn't much functionality around building financial markets. So with Simplicity you have something where you have contracts which can be mathematically proven ahead of time, so you actually know what you're signing when you get yourself into it.","offset":3229,"duration":26},{"text":"But moreover, you can also create these binary outcome type of situations such as prediction markets. You can create these financial derivatives, there's a lot more scripting opportunities since you can have these external oracles that determine outcome etc. etc. So with that, you have a lot more opportunity to build financial products which are Bitcoin-native.","offset":3255,"duration":24},{"text":"Um so I think it's very early days. It went live on Liquid, it's not live on Bitcoin as you said. I think there's a lot to play around with to test and um it becomes possible to create these like HodlHodl type of structures etc. You can create options futures binary outcome contracts etc. etc. So I think it's super super valuable, but we're so early days. I think Swaption is the first one to go live with anything with Simplicity. We have maybe ten trades a day um most of the trades are shall we say very low value at this stage. Um people are just dipping their toes to try and understand the product I think. So um yeah if anyone's out there wants to play around with it, feel free to go uh ahead. There's no KYC or AML to get involved.","offset":3279,"duration":50},{"text":"Host: Yeah I mean and the key there is you can set up these types of P2P exchanges and whatnot without giving up custody using something like Simplicity, right?","offset":3329,"duration":12},{"text":"Scott: Correct.","offset":3341,"duration":1},{"text":"Host: Um and I guess it's kind of been pitched to me as like a competitor to how Ethereum does things that is more conservative and safety oriented, more robust kind of coming out from a Bitcoiner mindset rather than a shitcoiner mindset. But offering a lot of the same potential I guess if used appropriately.","offset":3342,"duration":20},{"text":"Scott: Exactly. The contract is mathematically verifiable ahead of time, whereas I think on Ethereum many times when a developer creates these smart contracts or vaults, there's a lot of how skilled is the developer behind it? Um and very easy to verify.","offset":3362,"duration":17}],"startTime":3198},{"title":"Call to Action: Testing Liquid Wallets","summary":"Scott and the host encourage listeners to download wallets like Sideswap, Bolt, or Aqua to experiment with Liquid's low fees and privacy features. The host praises the seamless experience of moving funds between wallets on the Liquid network compared to Lightning.","entries":[{"text":"Host: Fair enough. Um fascinating. Uh yeah, so I'll put links to all this stuff in the show notes. I mean to the the audience like what do you how can they be helpful? What are you what are you looking for? I mean obviously yeah, what is- do you have a call to action for them or how are you thinking about it?","offset":3379,"duration":26},{"text":"Scott: I mean, I'd love for people to just download the app and send a small- total amount of Bitcoin into Liquid and just play around with swaps. Just see what's possible, what's out there, how far it's come. Just do a few swaps back and forth. Um trying the order books. Go to Swaption just try these Simplicity contracts and just see where things are heading. Um and I think things will clear up for a lot of people because it's one thing for us to discuss back and forth, but once you get your hands on something and actually start playing around with it, trying it out, it just resonates so much more with you if that's what you believe where things should be heading. Um and hopefully more eyeballs will start looking at this and start developing these Simplicity products and building a lot more financial products around Liquid.","offset":3405,"duration":53},{"text":"Host: Yeah, what I would say is um just on um in terms of low-level playing around with Liquid, I mean if you install Bolt Wallet by Bull Bitcoin, so that's not their exchange service, I think people get confused by it but this is their self-custody wallet that offers on-chain, Liquid and Lightning. Aqua Wallet, which is Samson's wallet which offers um on-chain Lightning Liquid and then also Tether support. And then the Sideswap app, um you can peg in a very small amount for a very small fee from regular Bitcoin into Liquid Bitcoin on Sideswap. Then you can easily send it between the three wallets.","offset":3458,"duration":42},{"text":"Um and then if you go to liquid.network, which is mempool mempool.space's Liquid instance, it shows all the transactions that are happening on liquid.network. And do a little blockchain analysis on yourself. Look at the transactions as they're happening. Um you can check mempool.space for your peg-in transaction, you can look at liquid.network for your transactions in between wallets. Look at what the on-chain footprint looks like.","offset":3500,"duration":26},{"text":"I think it's if you care about Bitcoin privacy, it's pretty impressive. If you do a couple small swaps with Tether or whatnot you can also see what the privacy situation is in that regard and I think that's pretty fascinating. I think if you even if you're not interested in- I I remain convinced that the Tether use case is absolutely massive. Maybe not for this audience, I think a lot of us don't have a need for Tether, I mean I have the traditional US banking system, I keep the majority of my family's savings in on-chain Bitcoin in self-custody, but there's a huge demand for Tether out there.","offset":3526,"duration":-561},{"text":"But even if even if you're not interested in that aspect, the settling between Lightning-focused wallets. Like if you have a large amount of funds in Bolt Wallet and you want to move them over to Aqua, it's way easier to send a native Liquid transaction. You don't have to deal with liquidity, you have pretty good privacy uh guarantees. Um you have very low fees. It's way easier to send using Liquid than sending through Lightning.","offset":2965,"duration":35},{"text":"And I have noticed as someone who's been using Bolt Wallet more often, um it's a bit of a breath of fresh air versus having funds, you know, stuck in Phoenix Wallet for instance and knowing that every time you make a transaction you're going to get charged a 1% fee and you have liquidity constraints and channel management and all that to deal with. Um so I think that's an interesting way to get your feet wet. I think the Sideswap app in general is you should be very proud of it. It feels like a very robust app that is um performant, you know, like I I don't feel like it's like lagging when I'm clicking buttons and whatnot. I like I have confidence in it, which is no easy feat as someone who's been heavily involved in building out multiple apps now at this point.","offset":3000,"duration":41}],"startTime":3379},{"title":"The Potential for AI Agents Using Liquid","summary":"The host suggests that AI agents could benefit from Liquid's USD token support and node-less Bitcoin transactions. Scott acknowledges the massive opportunity but notes his small team remains laser-focused on developing Simplicity products.","entries":[{"text":"So you deserve a lot of credit that there. But, you know, people should just- I- it'd be great if people play around with it. And then the last thing I would say is I don't know, have you been playing around with like any of this AI stuff?","offset":3041,"duration":16},{"text":"Scott: I mean, in certain aspects we played around quite a bit but if you mean in terms of developing things within the Liquid ecosystem or Sideswap we've done very little. Helping write press releases etc. but yes but in terms of code um very little.","offset":3057,"duration":16},{"text":"Host: I mean everyone the newest thing to hit the block was this OpenCal idea which is you know I think directionally fascinating and probably still pretty early. But this idea of like having a self-hosted robot that has its own memory and can access any apps, ideally CLI apps it works better with, but it can actually like navigate a GUI which is crazy, it can navigate like a graphical user interface or like a website and stuff if there's no API or no CLI.","offset":3073,"duration":28},{"text":"And you basically just have like this robot butler and there's I think as a result of it there's been a a renewed focus on the concept of agentic payments. Like how would the agents pay each other? I think what a lot of people miss there is also the agents also have to be able to receive and send payments from humans too. So when you say agentic payments it's actually not just agent to agent, it's human to agent and agent to human and agent to agent.","offset":3101,"duration":24},{"text":"And Liquid could be interesting there. There's there's obviously demand for people to have USD token support on these things. USDC has become very common, at least in the Silicon Valley world of AI stuff. Um but the combination of Liquid Tether support and Liquid Bitcoin support on the same chain in a way that is as simple as just holding keys. They can just generate a wallet, they don't have to deal with having the node have uptime, dealing with channel management, dealing with all these other stuff. There there is an interesting opportunity there in terms of Liquid being used by by the robots. And that of course is just leaving out the vibe-coded apps or whatever building on top of Liquid which is presumably much easier than on Lightning as well. So that's what I was thinking.","offset":3125,"duration":46},{"text":"Scott: No no, there's so many opportunities in all these areas. We're a super small team, I mean we're trying to just be laser focused in a small area and many times it's probably bit like a horse walking around with the blinders. Miss- miss so many things happening around you all the time when you're too laser focused in one area. So right now we're just focused on building these Simplicity products, getting more acquainted with all limitation of um these binary products. Like how do you have many parties trade? Can you like hand over your position in one binary market to someone else if you need to hold to maturity? Can you have netting etc.","offset":3171,"duration":39},{"text":"There's sorry many things to figure out.","offset":3210,"duration":3}],"startTime":3041},{"title":"Roadmap: Satoshi Dice, Prediction Markets, and Oracles","summary":"Looking ahead six months, Scott outlines plans to release a Satoshi Dice-style game as a stepping stone toward a full prediction market MVP. The host suggests temporarily piggybacking on external oracles, like Polygon's UMA, while Liquid-native solutions are developed.","entries":[{"text":"Host: Well, I really want to see- the freaks know, I just want to see native Bitcoin prediction markets with decent privacy guarantees. I think Liquid could be the holy grail for it. We'll see. Cautiously optimistic. I've been wrong about Liquid adoption multiple times, both on the bear side and the bull side. I think um I was probably too bullish at one point, then I was a little bit too bearish. We've recently seen more of an uptick in usage. Maybe the reality is somewhere in the middle, but I applaud you guys for continuing to build it out and see what works and see what doesn't and try and build out that key infrastructure to to help everything else grow. I would love if we can we do like an update show in like six months or something to see where we stand on all this stuff?","offset":3213,"duration":47},{"text":"Scott: I'd love that, I'd love that.","offset":3260,"duration":3},{"text":"Host: Awesome, okay. Scott-","offset":3263,"duration":2},{"text":"Scott: Yeah, go on.","offset":3265,"duration":1},{"text":"Host: Let's do something funner. So if we have this update in six months, prediction-wise where are we? Um you're going to in six months you're going to have a full-fledged Poly Market competitor for me.","offset":3266,"duration":15},{"text":"Scott: Let's make it an MVP of it anyway.","offset":3281,"duration":2},{"text":"Host: I mean where do you think- I'm obviously half joking, it's a big undertaking- what do where do you think Liquid and Sideswap will be in six months?","offset":3283,"duration":9},{"text":"Scott: I think we'll have the POC for it.","offset":3292,"duration":3},{"text":"Host: That's awesome, that's exciting.","offset":3295,"duration":2},{"text":"Scott: We're not very far- we're actually doing in the background a Satoshi Dice-type of structure. So we're building out a few like more betting type style of markets just to figure out what all the edge cases around Simplicity and just get the market mechanics correct. So we're heading in that direction towards the prediction market model but right now we're just doing the binary outcome type of contracts. So we need to get the order book correct where the order book is 0 to 100 instead of whatever the price of Bitcoin is.","offset":3297,"duration":30},{"text":"Right.","offset":3327,"duration":1},{"text":"Scott: And then we need to- so we have Liquid Connect built, but there's still a bit more work in that area. And then we need to figure out the whole oracle aspect to make that have integrity in some shape, form, regard which we don't have any clarity over just yet. Right now we just have a super simple oracle that's basically just signing the Bitcoin price. So that the contract can determine outcomes.","offset":3328,"duration":23},{"text":"Host: There might be something there- first of all that makes sense to me. I mean, you know, you do the little things to get comfortable and um improve your understanding and your execution before you actually go for the the big one. You know, Poly Market is using something called UMA, I don't know, it's like so hard to keep track of all this shitcoin stuff. They're using something called UMA's optimistic oracle where there's like a whole process on chain of an oracle determining the result of markets. Um and that's all on chain on some Polygon or different shit chain.","offset":3351,"duration":46},{"text":"But because it's all on chain, you might actually be able to just piggyback their oracles in the beginning because that's a hard thing- it's hard to get people to step up and be the oracles is like just a people problem um in the beginning. Um so you might actually be able to just hijack their oracles and just use the same resolution mechanism that they're using in terms of source of truth. If they're already signing cryptographic attestations on some chain out there of ton of markets, right? Like from weather to missile strikes to basketball games, then you could potentially just piggyback them until you have a um Liquid native alternative out there on the oracle side.","offset":3397,"duration":43},{"text":"Scott: We'll look into it. I know Blockstream's putting a lot of work now into the oracle because they're obviously big team now laser focused on Simplicity. So so they're also doing a lot of work around integrating everything. I think they're looking at some Wallet Connect feature.","offset":3440,"duration":15}],"startTime":3213},{"title":"Episode Wrap-Up and Outro","summary":"Scott thanks the listeners for their interest in Liquid and Sideswap. The host provides final links, promotes next week's guest, and signs off.","entries":[{"text":"Host: Interesting. Fascinating. Scott, this has been great. Do you have any final thoughts for the freaks before we wrap here?","offset":3455,"duration":7},{"text":"Scott: Not much, just super happy if anyone's made it this far listening to us go on about Liquid and Simplicity and my favorite project Sideswap.","offset":3462,"duration":11},{"text":"Host: Love it. Um freaks, I'll have links to everything we discussed in the show notes. Like I said, you'll probably be listening to this in a couple hours. Um best way to support the show is sharing with friends and family. All relevant links at Citadeldispatch.com. Reminder to check out Citadelwire.com. I have uh already next week I have lined up on the calendar a conversation with Leia who is a co-founder of Vexel. They do P2P Bitcoin exchanges without KYC. So that'll be a great conversation keep an eye out for that. And uh play around with Liquid. Scott is looking for feedback, he's looking for more users, more people playing around with these things. I think all of it can be helpful. While we are in these bear market, it's always great to just dive into the tech and uh get your feet wet. Um there's no better time than today. Thank you Scott.","offset":3473,"duration":52},{"text":"Scott: Thanks Matt.","offset":3525,"duration":2},{"text":"Host: Thank you freaks. Stay humble, stack sats. Peace.","offset":3527,"duration":15}],"startTime":3455}],"entries":[{"text":"Host: Happy Bitcoin Monday freaks. It's your host Odell here for another Citadel Dispatch, the show focused on actionable Bitcoin and freedom tech discussion. The current block height is 840,011. That brings us into Fiat time. Fiat time, it's Monday March 11th, um they just did the timezone change on me, at 17:00 UTC, no, 16:00 UTC.","offset":0,"duration":46},{"text":"Um, you guys will probably be listening to this in a couple of hours. I don't like sitting on it, I like to get it to you ASAP. Current sats per dollar is 1,452. Current price in dollars is 68,863. And the current price in gold is one Bitcoin, you can get one Bitcoin for 12.84 ounces. Um, Bitcoin's down on gold on the day, the month, and the year, but we're slightly up on the week. Something to keep an eye on.","offset":46,"duration":52},{"text":"As always, Dispatch is supported by viewers like you. We have no ads or sponsors, so thank you to everyone who continues to send Bitcoin donations to support the show. The two largest supporters, I'm going to say from uh the last two weeks since, or the last two episodes since they were back to back, was we have Mav21, he sent two separate 10,000 sat zaps, both saying \"great rip\". Thank you Mav21, true ride or die.","offset":98,"duration":35},{"text":"And we have Captain Cook with 7,654 sats. He had no comment, but thank you for your support. As always, sharing with friends and family also goes a long way. Dispatch is available in all of your favorite podcast apps by searching Citadel Dispatch. All relevant links are at Citadeldispatch.com. And recently I've been playing around, I also launched Citadelwire.com where you can listen to the most recent Citadel Dispatch, the most recent Rabbit Hole Recap, um and get on demand news um from my soulless robot slave who I've been training and curating to try and provide the most relevant news using live market data.","offset":133,"duration":47},{"text":"Um, I got Poly Market plugged into him and Bitcoin prices and a bunch of other data sources, so that's a bit of a work in progress, but check it out at Citadelwire.com. Anyway, we have a great show lined up today. I have Scott here, he is the co-founder of Sideswap. Sideswap is, has just been grinding along building great product in the Liquid ecosystem. Something we haven't talked about for a while on the show. Um, how's it going Scott?","offset":180,"duration":32},{"text":"Scott: Hey Matt, uh thanks for inviting me. Yeah, uh everything's been going very well. Sideswap's been growing very nicely these past few years. Uh started out quite slow but we're growing organically and cash flow positive and um very happy with where we are. We focus much on the tech and building out what we hope is a great product liked by users. We don't focus much on marketing, which is why you may not have heard of us much.","offset":212,"duration":33},{"text":"Host: Yeah, so I mean, I was not really familiar with you guys. I like kind of a little bit a couple years back. Um, and then I started playing with Samson's Aqua Wallet, which more people might be familiar with, which is tries to do lightning um and Bitcoin with with Liquid as the base at rest. So it sits in Liquid and then it does swaps for receiving and sending. Um which we've seen a couple wallets do that.","offset":245,"duration":36},{"text":"Bolt Wallet has been doing it recently. Breeze has their own SDK that uses it as well. Breeze has like two rival SDKs in-house, one does Liquid and one does Spark. Um but I was playing around with Aqua Wallet and then I saw on the backend they were using you as the provider, which was cool. And then I was like, \"Okay well let me see what they're doing directly.\" And that's that's kind of how I was reintroduced to you guys and we had a mutual friend put us in touch and I it's just it's impressive what you guys have been quietly building with like you said, very little fanfare.","offset":281,"duration":39},{"text":"So I mean, to the freaks um to our audience here, what is Sideswap, how should they think about Sideswap?","offset":320,"duration":7},{"text":"Scott: Mm, well well Sideswap at its base is really a non-custodial wallet and it's based on the Bitcoin premise that your keys, your coins. So when we built the swap market, since Bitcoin doesn't have other assets other than Bitcoin on chain, we started looking at the layer twos. And since Tether was issued on Liquid, we figured we could build swap markets where we effectively have atomic swaps between two parties.","offset":327,"duration":32},{"text":"So you can create a bulletin board type of system and you trade a swap between the two parties so that settlement happens atomically and instantaneously real-time between the two counterparts to the trade. So we're never custodial of anything really, and that's a model that we're very much looking for. And the model we think everyone should really aim for and not go for the custodial model.","offset":359,"duration":34},{"text":"Host: So the correct- yeah, go on.","offset":393,"duration":2},{"text":"Scott: No no, you continue please, sorry.","offset":395,"duration":3},{"text":"Host: I mean, so the way I look at it is for the average person, at least on the surface, Sideswap is an app that you can download on your phone that lets you easily go from regular Bitcoin to Liquid Bitcoin and vice versa. And then if you want access to Tether, you can then easily swap between Liquid Bitcoin and Liquid Tether, correct?","offset":398,"duration":35},{"text":"Scott: Correct. So what one of the first big hurdles that we encountered was obviously getting people to move between the main chain and the Liquid sidechain. We effectively built one of these peg-in, peg-out services since very few people can be uh they they don't want to sit there and sync a full node on both the Bitcoin side and the Liquid side in order to be able to uh create the claim scripts and issue coins on Liquid.","offset":433,"duration":31},{"text":"And many of the services at the time had a very high fee, so we cut that down to 0.1% and had effectively a bridging service which anyone can use, which Aqua also uses. So um it's a 50-50 revenue split on anyone who's a partner and just uses our infrastructure, so they don't need to build it up themselves. And um with that done, uh we started focusing on the swaps on Liquid so that two participants can trade between themselves without having any intermediary.","offset":464,"duration":40},{"text":"So we effectively just offer a bulletin board system so that users can find each other and we and we help make sure that the swap has integrity, so that one party can't cheat the other one by effectively saving half-signed UTXOs which they could theoretically broadcast at a later date. And so the way we've built it, we also offer instant swaps but the way it's built we actually offer order books where anyone can come in and uh improve prices within the order book.","offset":504,"duration":34},{"text":"And any instant swap is effectively a market order into the order book. So dealers compete on pricing, um so hopefully we get spreads which become a lot tighter. Right now I think the spreads are about 0.2, 0.3% away from uh let's say the midpoint price many times. And um yeah, so there's lots of trading opportunities and lots of liquidity. The areas that we've really seen grow, initially it was a lot around um USDT but lately it's been D-Pix. It's really really grown in the Brazilian market.","offset":538,"duration":46},{"text":"Host: What is D-Pix? I saw it in the wallet.","offset":584,"duration":4},{"text":"Scott: Uh D-Pix is a Brazilian stablecoin uh issued by a company I believe called Ulem. So they have been behind much of the uh increase in adoption within Liquid lately.","offset":588,"duration":25},{"text":"Host: Fascinating.","offset":613,"duration":1},{"text":"Scott: Yeah, so if we look in our swap market just in terms of trades and transactions, I'd say D-Pix is probably the biggest market right now. Not in terms of volume, but in terms of transaction count.","offset":614,"duration":16},{"text":"Host: In transaction count D-Pix is the biggest, but in terms of total amount, Tether's still bigger?","offset":630,"duration":8},{"text":"Scott: Much bigger.","offset":638,"duration":1},{"text":"Host: Yeah.","offset":639,"duration":1},{"text":"Scott: People are a lot more comfortable holding Tether obviously.","offset":640,"duration":4},{"text":"Host: Yeah, they've been around for I mean, Tether's bread and butter is the high net worths, right? They've been around for a decade plus.","offset":644,"duration":9},{"text":"Scott: Uh exactly, whereas um I think D-Pix is many local payments within the Brazilian ecosystem, but it brings in a lot of users even if their transaction volumes aren't that large.","offset":653,"duration":16},{"text":"Host: How do I spell D-Pix?","offset":669,"duration":3},{"text":"Scott: D-E-P-I-X.","offset":672,"duration":3},{"text":"Host: D-Pix stablecoin. Interesting. So so okay, there's a couple things here. First of all, the order book thing is fascinating. It's like in general, a lot of these quote-unquote instant swap services you see are first of all custodial and second of all, they're kind of like a black box in terms of pricing. So it's cool that you actually have like a proper order book that basically anyone can participate in and become market makers. And as a result, it's more transparent pricing and theoretically, I guess, it should be better pricing.","offset":675,"duration":48},{"text":"Um I think it's pretty cool that you can actually participate in the order book on mobile, which makes accessibility good. But I assume it's quite obvious if you look at the order book for a little bit, like there's at least there's like one or two like real market makers there that are putting up more size than others. Are they using- they're not using like a mobile wallet, right? Like they is there like a CLI or something that they're accessing the order book with?","offset":723,"duration":36},{"text":"Scott: Uh we we've built quite a suite of tools. So in our GitHub repo, anyone can download the dealing software and if anyone needs help setting things up, um everything's available and you can yeah, run your own frontrunning code. So um I think we had a bit of an issue with that at one point since people were flooding the system with lots of quotes. But um yeah, growing pains like are good pains.","offset":759,"duration":35},{"text":"Host: Yeah, I agree with that. Um okay, fascinating. I mean, before we continue on, I mean, I think the big question that we've been asking on this show for years now um and I think Bitcoiners have been asking for a while is ironically the lack of liquidity on Liquid and the lack of users using Liquid. It seems like cautiously optimistic in terms of adoption increasing lately, and I would say partially it's probably these wallets that are using Liquid at rest for Lightning payments, specifically Bull and Aqua Wallet.","offset":794,"duration":44},{"text":"I mean, the fact that Liquid has confidential assets which incorporates confidential transactions, so each transaction you can't see the amount or the asset that's being sent, whether that's Bitcoin or Tether or whatever, um means that people that, you know, maybe are in the developing world that are sending um 20 cents worth of Bitcoin, you can't tell if that's $2,000 worth of Bitcoin or 20 cents worth of Bitcoin. So it actually compounds kind of beautifully in terms of adding, I guess, anonymity set to to Liquid.","offset":838,"duration":50},{"text":"Anyway, this is kind of a long-winded question, but where do you see Liquid adoption? Have you been frustrated with the lack of adoption? Do you- are you still opti- I mean, I assume you're still optimistic on adoption and how can that be accelerated? Because it kind of feels like Liquid has always been like the ugly stepchild of Bitcoin that just hasn't really found its wings.","offset":888,"duration":27},{"text":"Scott: No no, correct. I think much has to do really with Bitcoin being a one asset chain, it didn't really have any scripting abilities or or ability to issue other assets so that you could trade things like atomically. So so there was no real layer two which could really scale Bitcoin. So I think when all of these other chains came around and they offered all the smart contracts etc., very easy for anyone to get involved. I think that took out took off a lot.","offset":915,"duration":37},{"text":"And many of the exchanges I think focused on offering products and development within that area since there's a lot of money flowing in and promise. But I think as time goes on, I think Bitcoin which is like the settlement layer, developed properly and financial markets, it may have taken a bit more time. But I think Liquid is a step in the right direction in terms of how you build secondary layers. There's lots of questions around the making the two-way peg trustless and how you can go about that and the federation model and- but if we skip that side of the discussion, it's very nice to have an asset layer which is like Bitcoin-based, UTXO-based, that can hold multiple assets so that you can have these financial transactions, the swaps and everything else around it.","offset":952,"duration":55},{"text":"So I just think that side has taken a lot of time to get going, especially since it requires you to manage your own keys. I think none of the big wallet custodians like Fireblocks or anyone else has integrated Liquid so it hasn't been very easy for any exchange to offer it. So it basically onboarding one by one people are comfortable to holding their own keys. But going forward, I think now that Simplicity is live on Liquid, uh I think there's a lot of things that can be done and will offer a lot of fantastic features to users such as being able to create prediction markets in a Bitcoin-native type of ecosystem.","offset":1007,"duration":52},{"text":"Host: Yeah, I mean I want to jump in there specifically on the prediction market stuff, but before we do, just real quick I mean like my fascination with Liquid has always been on the privacy side, specifically confidential transactions. Um you know, a lot of the probability analysis that Bitcoin chain surveillance firms do is based on amount correlation. And once you remove those amounts from being visible, it makes their job of detecting when ownership has changed hands much more difficult.","offset":1059,"duration":52},{"text":"On the asset side um let's be frank, I think most tokens that have been launched in crypto are just straight up scams and the ones that aren't are also just probably horrible investments except for the undeniable US tokens, specifically Tether, right? And we've seen a massive market for Tether on Tron specifically, to a lesser extent on Solana and Ethereum. Um and it's fascinating to me because if you use those ecosystems, it's even worse than Bitcoin privacy. It's like you have a fixed address that is literally your entire transaction history.","offset":1111,"duration":69},{"text":"And so where I'm going with this is right now it seems like I'm cautiously optimistic that financial privacy in quote-a-quote broader crypto space seems to be having a moment. First we saw it kind of with the Zcash pump and dump and then recently Ray Dalio and Chamath both mentioned financial privacy as a concern. And I think part of it is because of of not even Bitcoin like Bitcoin could have better privacy but it's still relatively accessible. But the privacy situation on a Tron or a Solana is absolutely abysmal. It's horrible.","offset":1180,"duration":51},{"text":"Um so I'm surprised that there hasn't been more uptick on just the Tether use case. Like if you want to use Tether, which obviously has a trusted third party and I've never advocated for people to use Tether but there's plenty of demand for people that want Tether and want access to US dollars where they can't get it otherwise. The most private way to access Tether is through Liquid and specifically through Sideswap because you make peg-ins so easy um and peg-outs so easy and you make the ecosystem much easier, much more accessible.","offset":1231,"duration":48},{"text":"Why do you think we haven't really seen like like let's nail down specifically on Tether like why haven't we seen specifically massive Tether adoption on Liquid? It's like it's pretty much negligible compared to the other chains.","offset":1279,"duration":19},{"text":"Scott: It- it's absolutely nothing. I think there was about $35 million of Tether circulating on Liquid up until a few months ago when it when it was increased to 90-something million. So if you compare that to the other chains it's a drop in the bucket. Well- I think also much of the liquidity on the other chains uh is not really held in private wallets, it's held with custodians in one shape or form. Um with Liquid, since there are no custodians, um effectively people who are comfortable holding their own keys and assets, Bitfinex effectively custodying the balances for you.","offset":1298,"duration":52},{"text":"But something that's very interesting, which few people might have considered, is that USDT on Liquid, it's the only- due to the confidential transaction nature of it, the issuer cannot confiscate the balance. They- they don't know which UTXOs are USDT.","offset":1350,"duration":20},{"text":"Host: Yeah they'd have to confiscate it basically they'd have to like basically shut down Tether on Liquid is what they could do. But they can't do their like pick and choose \"I'm blocking this Tron address\" or whatever.","offset":1370,"duration":17},{"text":"Scott: Not like they can do on the other chains.","offset":1387,"duration":2},{"text":"Host: Yeah, that's why it's wild to me that just the Tether use case alone has- and so okay, they have a website USDT.network that tracks all of their usage across the different chains. Just just for reference for the freaks. I mean Scott said, what'd you say, you said 95 million Tether on Liquid?","offset":1389,"duration":22},{"text":"Scott: Yeah, I believe it's about- in that ballpark area.","offset":1411,"duration":5},{"text":"Host: Okay, well anyway it's completely negligible. The- there's $92 billion worth of Tether on Ethereum, $85 billion on Tron, just to with a B, just just to show the discrepancy. On the privacy side, I think it's also pretty cool that basically in practice, am I correct in saying that anyone who's doing a swap between Tether and Bitcoin, Lightning Bit- Liquid Bitcoin and Liquid Tether, is basically a payjoin transaction. And payjoin works even better on Liquid because of confidential transactions than it does on Bitcoin in terms of breaking probability analysis.","offset":1416,"duration":78},{"text":"Scott: I think there's a few different aspects to that. Um payjoin is something that we offer for people who have wallets where they don't have Liquid Bitcoin and need to pay the network fee. So- so we do lots of payjoin transactions every day. I think there's about 2 or 3 cent fee which covers- includes the network fee. So- so it's very cheap to do these payjoin transactions.","offset":1494,"duration":40},{"text":"And um when we have swap markets where you have two assets traded against each other, um where you don't have Liquid Bitcoin as one of the assets, we actually pay the network fee on behalf of the user in a payjoin with the swap. And since the swap there's two different assets being exchanged, it's very very little- the heuristics become very very difficult to- yeah, it's pretty wild, and particularly at a small user base, which is obviously the single biggest thing holding back Liquid as a as a more robust privacy tool. But it's impressive that it breaks it already breaks even at a smaller usage, it still's breaking a lot of heuristics. It makes it quite difficult.","offset":1534,"duration":66},{"text":"Yeah, and especially with the peg-in, peg-out process when you peg in and then you peg out, the federation also selects the UTXOs that you get when you peg out so there's no correlation between the two.","offset":1600,"duration":16},{"text":"Host: Right. They just know it came from the Liquid network. Like if you pegged out and then sent to Strike, they would know that those are Liquid-affiliated transactions but there wouldn't be a direct connection between peg-in and peg-out.","offset":1616,"duration":18},{"text":"Scott: But mind you, this was like two, three years ago, we we ran the UTXO set of Liquid through one of the chain analysis tools, and the UTXO set is effectively pristine since Bitfinex is responsible for um a decent chunk of it.","offset":1634,"duration":22},{"text":"Host: Fascinating. Oh yeah, I mean yeah let's talk about I mean you mentioned it, let's talk about prediction markets. I mean to me one of the big shames is that we I mean Bitcoiners have been talking about prediction markets for over 10 years now and they finally hit critical mass and the biggest one is on Polygon and uses USDC as its primary base asset, um that being Poly Market.","offset":1656,"duration":42},{"text":"Obviously like the functionality specifically with something like prediction markets, you need it to be self-custody, you need to not have liquidity concerns. These things make it very difficult to run any kind of prediction market on Lightning. We've seen a competitor pop up called Predics that is basically just a custodial wallet, you know, with managed payouts, which I think is just not sustainable or scalable, um and has massive, you know, regulatory exposure.","offset":1698,"duration":37},{"text":"Liquid seems like it could be ideal for a Bitcoin-native prediction market because it has simplicity, because you can do self-custody type smart contracts, because you have privacy. I mean we're seeing on the Poly Market side people's wallets are being tracked. They're like, \"This person was successful on these six different military markets, like they must be an insider with the Israelis or an insider with the US\" or whatever. Like it's getting arguably as it's made it more obvious why financial privacy is important on blockchains than actual financial transactions themselves because a lot of these markets are quite sensitive. So how are you thinking about prediction markets, Liquid, what kind of opportunities are there?","offset":1735,"duration":89},{"text":"Scott: Um well I think there's many aspects to your question. The first point you raised now with the insider trading ahead of the Iran, where someone seemingly made quite a bit of money betting on the 28th I believe. Um in terms of prediction markets being built on Liquid, I think it's still a bit out. We've done so much work in the background because there's so many building blocks that need to come into place before you actually build it.","offset":1824,"duration":33},{"text":"So what we've been building in the background is effectively a Liquid Connect type of function so that anyone can plug their wallet into a web page or that the web page can connect with a wallet so that you can send these transactions to the wallet directly because these swap transactions, especially with Simplicity contracts, can become shall we say fairly messy, non-standard, not super easy to do. So it requires a bit of work in that regard, a bit of like Metamask type of features but for Liquid.","offset":1857,"duration":51},{"text":"So we we've done much of that work, hopefully should be I mean we have it ready and in production but it should be a lot more useful I think next week. And we should release um a public API so that anyone can integrate. But um so that was the first step and then the second step is how do you build these prediction markets? So with Simplicity you can build these binary contracts and we've started playing around with it.","offset":1908,"duration":38},{"text":"I'm still not entirely sure all of the limitations, you can create these binary contracts um between two people and you have an oracle that determines the outcome um of the contract. So as long as the two parties trust the oracle, you can effectively bet on anything. But- but then the question becomes also how do you get people to fund the contract at the same time?","offset":1946,"duration":30},{"text":"Because if you create markets where someone needs to fund the contract initially and then someone funds the contract at a later date, you need to create some form of market structure that allows for that. What- what we've done is we've applied our order book and our swap market to it. So we're looking at creating markets where you have a instead of an order book that goes from with a Bitcoin price say from wherever it is now um $70,000. So you have an order book that goes from 0 to 100 effectively.","offset":1976,"duration":47},{"text":"And so the bid will be the yes outcome and the offer will be the no outcome. And wherever you bid within that order book is the prediction rate. So- so whoever's on shall we say the yes side, it bids 30 um they fund the contract with 30 cents and the offer will need to fund it with 70 cents. So that there's one full dollar in the contract and once the contract um once the prediction either comes true or false, when the oracle has a definite outcome, it's a winner-take-all type of situation where everything goes to one of the two parties.","offset":2023,"duration":50},{"text":"And that's effectively how you price it. So with our order book structure, we can create that so that two parties enter into a swap at the same time and that the contract is funded with the swap at once. So that you don't have the issues of who goes first etc. funding a contract and creating an order book with resting orders and people having locked up funds waiting for other users to come in etc. etc. To be honest, I'm not sure how Poly Market's done it. I know their order book's quite efficient but the question is how does it actually work under the hood?","offset":2073,"duration":43},{"text":"Host: I'm pretty sure they're basically trading yes and no tokens on each market has their own token. I mean the user doesn't see it.","offset":2116,"duration":10},{"text":"Scott: Mm, that's one option of going about it but the other option is creating the contract directly and you have the two users fund the contract.","offset":2126,"duration":12},{"text":"Host: Yeah, there's a couple different things right? Because it's like okay with prediction markets for prediction markets to work at scale you need a couple things. You need uh you need the ability for people to participate anonymously because the whole idea is trading prediction markets benefits insiders, tracking and watching prediction markets benefits outsiders because you're giving insiders an incentive, a financial incentive to effectively tip their hand and and trade a market which then exposes um which exposes their belief on how that market will what the outcome will be.","offset":2138,"duration":51},{"text":"So they need to be able to do it anonymously because if they work for Intel or if they work for a government or something they're not going to do it unless they can do it anonymously. So with that understanding, then it needs to be at least relatively decentralized and self-custodial because if there's a single company that is controlling funds and controlling payouts, then they're ultimately going to be pressured by a government to dox all users. So you're never going to have permissionless participation unless it's relatively decentralized.","offset":2189,"duration":44},{"text":"And then the last piece is the oracle problem, which is how do you how do you determine in a um robust and objective way what actually happened to settle the contracts afterwards. And so Poly Market like kind of made it there on all of those pieces but they kind of hand-waved a bunch of stuff away. Like Polygon itself, you know, I think could be argued that it's still pretty centralized. Ethereum very centralized. USDC obviously is completely centralized and can be frozen at will.","offset":2233,"duration":52},{"text":"Um the oracle problem they haven't actually solved, they just offload it. It's like they don't make the decision, they have like for each market there's a designated quote-a-quote on-contract oracles so there's it's still crypto-native if you will but it's still ultimately, you know, centralized entities saying ESPN reported that the game um was, you know, the Clippers won the basketball game or whatever.","offset":2285,"duration":32},{"text":"Uh so they didn't solve the oracle problem and they're like quote-a-quote decentralized enough to not have to do KYC and block people's access to markets. Um and I think this is just something interesting by the way for Bitcoiners and Liquid where the shitcoiners have done a really good job of kind of being pragmatic about tradeoff balance when it comes to censorship resistance and decentralization that Bitcoiners have not been.","offset":2317,"duration":22},{"text":"I mean I we haven't really touched on it but there's a lot of controversy for instance around the Liquid Federation model and whether or not it is technically self-custody or not. But if you which is something that's I think unique to the Bitcoin community because if you look at something like Tron, it's pretty much the same trust model as Liquid but Tron has gotten a pass from regulators, they consider it decentralized enough. And Tron, like I said earlier, has $85 billion of Tether volume alone on it, which is a wild stat.","offset":2339,"duration":35},{"text":"So to me Liquid could be this middle ground for Bitcoiners. And we could actually I mean there could actually be a trust model set up on a Liquid-style prediction market that is significantly better than Poly Market, which is right now operating at scale with very sensitive markets at a $10 billion-plus valuation with many many users. And it seems like too good of an opportunity to to miss out. So I mean on that point, that was very long-winded, but you more than anyone, you know you've been quietly bootstrapping and building a business on Liquid, how do you think about that trust model in terms of the federated model? Because I mean it could kill your business if if it wasn't um sufficient enough, let me put it that way.","offset":2374,"duration":45},{"text":"Scott: Of course, and that's also one of the growing pains that we'll need to encounter at some point. But right now while we're so small, I I think no one's looked um deeply enough at all of these questions in terms of Liquid, the Federation, how it's structured set up, is it decentralized enough etc. etc. Uh right now we're very much just focused on getting the market model correctly, getting everything easy for users to access, make it easy to trade.","offset":2419,"duration":29},{"text":"Since everything's non-custodial, you hold your own wallet, you hold your own keys, the contracts are on chain, you swap into it can be verified uh within the wallet by the users prior to executing the swap. But then there's all the ques- so the question is is that decentralized enough? It's very difficult to say, like different regulators may take a different view given the Liquid governance model very unclear.","offset":2448,"duration":29},{"text":"Um then there's I think all the questions around how the oracle is constructed etc. We're not trying to solve all of these like shall we say philosophical or mathematical questions right now, we're just focusing trying to get the market structure correct. And once we have that in place, we can start tinkering around the edges with everything else. I think the oracle problem's not super easy to solve. Blockstream's working on it, they they have a model that they've proposed. Um is that good enough? Not sure.","offset":2477,"duration":34},{"text":"Host: I mean, like I said, it's not like Poly Market has solved it. It just needs to be robust enough. It's never going to be- we're not going to- I'm convinced that the oracle problem is is unsolvable. You can mitigate it, you can create a relatively usable and decent and robust solution but actually quote-a-quote solving the oracle problem, solving something happening in the real world and then being able to cryptographically prove it on chain is going to require some trusted third parties that are cryptographically proving it on chain.","offset":2511,"duration":45},{"text":"Those trusted third parties, you can reduce their influence or risk by combining multiple of them, by adding reputation systems. I think DLCs are interesting where they're providing oracles but they don't know which market they're providing oracles for. There's different ways you can do that. But at the end of the day, for someone on chain to know what the weather was in Chicago yesterday, like there's going to be trusted third parties. There's I- I don't think it's solvable in that regard.","offset":2556,"duration":15},{"text":"Scott: There's no way around it I think.","offset":2571,"duration":2},{"text":"Host: Yeah, exactly. And on the on the point of Liquid, I mean would you agree with me like if Tron is self-custody, if you consider Tron self-custody, I think you have to consider Liquid self-custody. I mean Justin Sun is basically the arguably the model for Tron is worse than Liquid in terms of censorship resistance and trusted third parties.","offset":2573,"duration":17},{"text":"Scott: I- I would say so, obviously I'm biased, um my hope as well is in that direction so take it from what it is.","offset":2590,"duration":9},{"text":"Host: I will say that I think um where we're seeing, I mean the big one that everyone is I mean anyone who's actually building in the space has been paying attention to is Spark. Um and there's a lot out of Lightspark, which is David Marcus's A16Z-funded company after he was formidably working for Facebook for Meta. And I'm already seeing like the Bitcoin culture fights over whether or not that is considered self-custody. Um and it's a similar idea of a pragmatic approach that is maybe more similar to what we see in shitcoin land but I think could be very useful for Bitcoiners.","offset":2599,"duration":37},{"text":"Yeah, and I wonder if that will bring more attention to Liquid because I mean if you mono-a-mono it out, I think the Liquid model is more robust than the Spark model. Um and then you have other things, I love the Phoenix team with Async. Um like the trust model for that is not as clear cut as you hold your keys, you have self-custody. On-chain is very clean. On-chain Bitcoin's very clean, it's either self-custody or it isn't. Once you start playing with the tradeoff balances across the stack, things get a little bit more definitionally messy. And I think the Bitcoin community specifically has been wrestling with that for many years now.","offset":2636,"duration":41},{"text":"Scott: Well- I mean if you look at how the financial system is built, you effectively have a central bank they they operate one ledger. Uh then you have all the commercial banks below, they each operate their own ledger. So if you want to move cash from one one bank to another, it's actually the bank's accounts at the central bank that need to be updated before the banks themselves update their own accounts. So the whole financial system is built on lots of different ledgers and all these clearinghouses are effectively the ones managing the risks between the different ledgers and um shall we say the net deferred settlement between ledgers.","offset":2677,"duration":37},{"text":"So for Bitcoin to scale given that it is a one-asset chain, you need these secondary layers somehow. Since there's no solution yet exactly of how to create these exact or trustless two-way pegs between the Bitcoin main chain and a sidechain, that there is always going to be these different tradeoffs and discussion around how decentralized it is, at what point do the regulators consider it being decentralized or not. So there's always these questions.","offset":2714,"duration":34},{"text":"Host: Yeah of course. It's just an interesting it's an interesting um interesting thoughts to go down. Um I'm sure we're going to get comments about it too which is why it's incredibly important to talk about it. Um pretty much they come up anytime Liquid is brought up. And I think rightfully so. I think it's good that the community is at least a subset of the community, which percentage-wise is getting smaller by the day but absolute numbers-wise has never been higher, cares so much about these hard questions and sovereignty and and using these things in freedom-oriented ways while like like I said, like shitcoiners kind of just throw it out the window and think of it as an afterthought. You guys recently launched a new product. Are you at liberty to talk about it right now or?","offset":2748,"duration":53},{"text":"Scott: Yeah, sure. Um so this is like our first dipping our toes into the Simplicity uh shall we say pool if we're in the Liquid space. But- but what we've effectively what- we have this website or sister website called Swaption, uh where we've plugged this Liquid Connect which is a bit of a privacy dox since if you do connect you share the watch-only wallet with Liquid Connect because otherwise it wouldn't be able to help you create the transactions and everything within your wallet and send the transaction for signing to your wallet. So there is that aspect to consider.","offset":2801,"duration":39},{"text":"Host: Would you- similar to the tradeoff with using like an Electrum server right? On-chain Bitcoin.","offset":2840,"duration":5},{"text":"Scott: Uh yeah. No no, exactly.","offset":2845,"duration":3},{"text":"Host: Right, okay, continue.","offset":2848,"duration":2},{"text":"Scott: There is that tradeoff. Um I mean, we never data mine our users or anything else. Uh so- but I mean, there's no way for users to verify that. But- but in terms of Swaption, so with the Liquid Connect function that we've developed with the wallet, if you visit the Swaption webpage, what we've built is the first binary outcome contracts, which is the first step in the direction towards prediction markets effectively.","offset":2850,"duration":29},{"text":"So we have two different products. One is \"Will the Bitcoin price be higher or lower in shall we say two, five or ten minutes than it is now?\" Um and then the other product is \"Will the Bitcoin price of Bitcoin go up or down like 1, 2, 3, 4 or 10% first?\" So it's a binary outcome, does it go up or down 10%. So people can make a bet in terms of direction etc., hedge positions um with leverage.","offset":2879,"duration":27},{"text":"So the idea was also here to open up so that anyone can trade in the order book and provide liquidity and improve prices etc. So right now there's not fantastic payouts but we're working very hard in that direction to create these order book type of markets so that anyone can come in and provide liquidity.","offset":2906,"duration":19},{"text":"Host: So I mean, your main website is sideswap.io?","offset":2925,"duration":4},{"text":"Scott: Correct, that's- that's where you download the app and the webpage is being reworked as well, so soon you'll be able to use the Liquid Connect and trade via the webpage as well.","offset":2929,"duration":10},{"text":"Host: And then Swaption is- is it swaption.com?","offset":2939,"duration":3},{"text":"Scott: .io.","offset":2942,"duration":1},{"text":"Host: swaption.io. And then that's S-W-A-P-T-I-O-N. Um I'll put all these links in the show notes. And then Liquid Wallet Connect is basically I have the Sideswap app on my phone or another compatible Liquid wallet, which I don't think there are any right now?","offset":2943,"duration":15},{"text":"Scott: Yeah, none.","offset":2958,"duration":1},{"text":"Host: Yeah. And then I'm like scanning a QR code on the website to sign in basically, right?","offset":2959,"duration":4},{"text":"Scott: Correct, or if you have a desktop wallet, it will detect the desktop wallet with the browser.","offset":2963,"duration":6},{"text":"Host: Do you have a desk- Sideswap has a desktop wallet too?","offset":2969,"duration":3},{"text":"Scott: Yeah. Well we've built everything in Flutter, so it's very easy to go cross-platform.","offset":2972,"duration":6},{"text":"Host: And then so you're saying this is kind of in a lot of ways it's kind of a proof of concept because it's a relatively simple type of market that you could have compared to a prediction market.","offset":2978,"duration":9},{"text":"Scott: Exactly. So we're dipping our toes, this is like the first MVP that we push out. There's only one dealer we don't allow yet, but that's coming, that anyone can compete and improve prices. Um and then the next steps are obviously developing these open order books so that anyone can come in. Maybe add functions such as auto-signing etc. in the Liquid Connect so that users don't need to sign every transaction so it becomes a bit more Poly Market-if you will.","offset":2987,"duration":31},{"text":"Uh so there's lots of these thoughts in terms of different directions we can go. We'd love for Aqua and other wallets obviously to integrate so that it becomes ubiquitous within the Liquid ecosystem. Liquid Wallet Connect.","offset":3018,"duration":11},{"text":"Scott: Yeah.","offset":3029,"duration":1},{"text":"Host: No that makes sense to me.","offset":3030,"duration":1},{"text":"Scott: But it's developed by us so- so it's called Liquid Connect but let's see if others pick it up or if it's actually Sideswap Connect.","offset":3031,"duration":8},{"text":"Host: Fair enough. Um I mean we kind of have a similar situation in the Nostr ecosystem where we have an open standard called NsecBunker that uses you either paste a code or or use a QR code scan, I think QR code scan makes a lot of sense if like the user has a mobile phone, they're like scanning it with a QR code. But the reason I bring it up is because we integrated it into Primal, so it works with any Nostr website that has this standard set up but we are seeing people like add like some people frame it as \"Sign in with Primal\" even though it's an open standard technically anyone else can have NsecBunker support, which is important I think.","offset":3039,"duration":32},{"text":"I mean, you know, I think part of the challenge you guys have had is it seems like you've been building quality product but you need other people to also be building around you. You need more wallets. You need more hardware wallets, it's just Jade right now right? You need more use cases.","offset":3071,"duration":17},{"text":"Scott: There's quite a few others who have integrated like different types of service providers, different wallets. Um mainly actually in the Brazilian ecosystem around D-Pix. And anyone who integrates with us we offer a 50-50 split on any volumes they drive our way. Uh so it's a very easy way for them to build wallets not have to develop all the swap market infrastructure etc. They just plug our stack and then we split the whatever trading fees 50-50. So it makes a lot of sense for them as well and it helps us build network effects around our markets so that we get deep liquidity.","offset":3088,"duration":44},{"text":"Host: Yeah, I mean liquidity begets liquidity. It's like the hardest network effect to to tackle but once you get it-","offset":3132,"duration":6},{"text":"Scott: Yeah.","offset":3138,"duration":1},{"text":"Host: What- like where'd the D-Pix guys come from? Was that a why'd they choose Liquid? That's pretty-","offset":3139,"duration":6},{"text":"Scott: That's a very good question. Um I'm not quite sure. I actually think one of the aspects was that one of the premises of the Sideswap swap market is that any asset you hold in your wallet you can post on the bulletin board and create markets for. And we have all this dealing software that we offer for free so that anyone can create liquidity in whatever asset they have.","offset":3145,"duration":18},{"text":"Host: So did they start using you without even talking to you or was there a conversation?","offset":3163,"duration":4},{"text":"Scott: There was no conversation until they arrived, which is-","offset":3167,"duration":2},{"text":"Host: That's kind of awesome. That's super Cypherpunk.","offset":3169,"duration":2},{"text":"Scott: And um but moreover, since we don't charge any listing fees or anything else, so if they went like on in the Tron ecosystem if they want to get listed with Binance what would that cost to list their coin and millions of dollars?","offset":3171,"duration":-48},{"text":"Host: Millions of dollars.","offset":3123,"duration":62},{"text":"Scott: It- it wouldn't- it wouldn't work. So the barriers to entry I think in Liquid are so low because anyone can issue assets and if you trade through Sideswap there's absolutely no gatekeepers at all. Anyone can create order books for whatever product they have.","offset":3185,"duration":13},{"text":"Host: That's pretty cool. Um I mean you mentioned Simplicity and Simplicity is a smart contract language that Blockstream championed for Liquid with the the hope I think that one day it could be used on Bitcoin on-chain as well. Ironically, given the name, it's actually not that simple to get your head around. Do you have a high-level explanation of why Bitcoiners should care about Simplicity?","offset":3198,"duration":31},{"text":"Scott: Well I think high-level abilities for Bitcoin to have different types of scripting options were like limited to like timelocked contracts, hashlock, etc. There wasn't much functionality around building financial markets. So with Simplicity you have something where you have contracts which can be mathematically proven ahead of time, so you actually know what you're signing when you get yourself into it.","offset":3229,"duration":26},{"text":"But moreover, you can also create these binary outcome type of situations such as prediction markets. You can create these financial derivatives, there's a lot more scripting opportunities since you can have these external oracles that determine outcome etc. etc. So with that, you have a lot more opportunity to build financial products which are Bitcoin-native.","offset":3255,"duration":24},{"text":"Um so I think it's very early days. It went live on Liquid, it's not live on Bitcoin as you said. I think there's a lot to play around with to test and um it becomes possible to create these like HodlHodl type of structures etc. You can create options futures binary outcome contracts etc. etc. So I think it's super super valuable, but we're so early days. I think Swaption is the first one to go live with anything with Simplicity. We have maybe ten trades a day um most of the trades are shall we say very low value at this stage. Um people are just dipping their toes to try and understand the product I think. So um yeah if anyone's out there wants to play around with it, feel free to go uh ahead. There's no KYC or AML to get involved.","offset":3279,"duration":50},{"text":"Host: Yeah I mean and the key there is you can set up these types of P2P exchanges and whatnot without giving up custody using something like Simplicity, right?","offset":3329,"duration":12},{"text":"Scott: Correct.","offset":3341,"duration":1},{"text":"Host: Um and I guess it's kind of been pitched to me as like a competitor to how Ethereum does things that is more conservative and safety oriented, more robust kind of coming out from a Bitcoiner mindset rather than a shitcoiner mindset. But offering a lot of the same potential I guess if used appropriately.","offset":3342,"duration":20},{"text":"Scott: Exactly. The contract is mathematically verifiable ahead of time, whereas I think on Ethereum many times when a developer creates these smart contracts or vaults, there's a lot of how skilled is the developer behind it? Um and very easy to verify.","offset":3362,"duration":17},{"text":"Host: Fair enough. Um fascinating. Uh yeah, so I'll put links to all this stuff in the show notes. I mean to the the audience like what do you how can they be helpful? What are you what are you looking for? I mean obviously yeah, what is- do you have a call to action for them or how are you thinking about it?","offset":3379,"duration":26},{"text":"Scott: I mean, I'd love for people to just download the app and send a small- total amount of Bitcoin into Liquid and just play around with swaps. Just see what's possible, what's out there, how far it's come. Just do a few swaps back and forth. Um trying the order books. Go to Swaption just try these Simplicity contracts and just see where things are heading. Um and I think things will clear up for a lot of people because it's one thing for us to discuss back and forth, but once you get your hands on something and actually start playing around with it, trying it out, it just resonates so much more with you if that's what you believe where things should be heading. Um and hopefully more eyeballs will start looking at this and start developing these Simplicity products and building a lot more financial products around Liquid.","offset":3405,"duration":53},{"text":"Host: Yeah, what I would say is um just on um in terms of low-level playing around with Liquid, I mean if you install Bolt Wallet by Bull Bitcoin, so that's not their exchange service, I think people get confused by it but this is their self-custody wallet that offers on-chain, Liquid and Lightning. Aqua Wallet, which is Samson's wallet which offers um on-chain Lightning Liquid and then also Tether support. And then the Sideswap app, um you can peg in a very small amount for a very small fee from regular Bitcoin into Liquid Bitcoin on Sideswap. Then you can easily send it between the three wallets.","offset":3458,"duration":42},{"text":"Um and then if you go to liquid.network, which is mempool mempool.space's Liquid instance, it shows all the transactions that are happening on liquid.network. And do a little blockchain analysis on yourself. Look at the transactions as they're happening. Um you can check mempool.space for your peg-in transaction, you can look at liquid.network for your transactions in between wallets. Look at what the on-chain footprint looks like.","offset":3500,"duration":26},{"text":"I think it's if you care about Bitcoin privacy, it's pretty impressive. If you do a couple small swaps with Tether or whatnot you can also see what the privacy situation is in that regard and I think that's pretty fascinating. I think if you even if you're not interested in- I I remain convinced that the Tether use case is absolutely massive. Maybe not for this audience, I think a lot of us don't have a need for Tether, I mean I have the traditional US banking system, I keep the majority of my family's savings in on-chain Bitcoin in self-custody, but there's a huge demand for Tether out there.","offset":3526,"duration":-561},{"text":"But even if even if you're not interested in that aspect, the settling between Lightning-focused wallets. Like if you have a large amount of funds in Bolt Wallet and you want to move them over to Aqua, it's way easier to send a native Liquid transaction. You don't have to deal with liquidity, you have pretty good privacy uh guarantees. Um you have very low fees. It's way easier to send using Liquid than sending through Lightning.","offset":2965,"duration":35},{"text":"And I have noticed as someone who's been using Bolt Wallet more often, um it's a bit of a breath of fresh air versus having funds, you know, stuck in Phoenix Wallet for instance and knowing that every time you make a transaction you're going to get charged a 1% fee and you have liquidity constraints and channel management and all that to deal with. Um so I think that's an interesting way to get your feet wet. I think the Sideswap app in general is you should be very proud of it. It feels like a very robust app that is um performant, you know, like I I don't feel like it's like lagging when I'm clicking buttons and whatnot. I like I have confidence in it, which is no easy feat as someone who's been heavily involved in building out multiple apps now at this point.","offset":3000,"duration":41},{"text":"So you deserve a lot of credit that there. But, you know, people should just- I- it'd be great if people play around with it. And then the last thing I would say is I don't know, have you been playing around with like any of this AI stuff?","offset":3041,"duration":16},{"text":"Scott: I mean, in certain aspects we played around quite a bit but if you mean in terms of developing things within the Liquid ecosystem or Sideswap we've done very little. Helping write press releases etc. but yes but in terms of code um very little.","offset":3057,"duration":16},{"text":"Host: I mean everyone the newest thing to hit the block was this OpenCal idea which is you know I think directionally fascinating and probably still pretty early. But this idea of like having a self-hosted robot that has its own memory and can access any apps, ideally CLI apps it works better with, but it can actually like navigate a GUI which is crazy, it can navigate like a graphical user interface or like a website and stuff if there's no API or no CLI.","offset":3073,"duration":28},{"text":"And you basically just have like this robot butler and there's I think as a result of it there's been a a renewed focus on the concept of agentic payments. Like how would the agents pay each other? I think what a lot of people miss there is also the agents also have to be able to receive and send payments from humans too. So when you say agentic payments it's actually not just agent to agent, it's human to agent and agent to human and agent to agent.","offset":3101,"duration":24},{"text":"And Liquid could be interesting there. There's there's obviously demand for people to have USD token support on these things. USDC has become very common, at least in the Silicon Valley world of AI stuff. Um but the combination of Liquid Tether support and Liquid Bitcoin support on the same chain in a way that is as simple as just holding keys. They can just generate a wallet, they don't have to deal with having the node have uptime, dealing with channel management, dealing with all these other stuff. There there is an interesting opportunity there in terms of Liquid being used by by the robots. And that of course is just leaving out the vibe-coded apps or whatever building on top of Liquid which is presumably much easier than on Lightning as well. So that's what I was thinking.","offset":3125,"duration":46},{"text":"Scott: No no, there's so many opportunities in all these areas. We're a super small team, I mean we're trying to just be laser focused in a small area and many times it's probably bit like a horse walking around with the blinders. Miss- miss so many things happening around you all the time when you're too laser focused in one area. So right now we're just focused on building these Simplicity products, getting more acquainted with all limitation of um these binary products. Like how do you have many parties trade? Can you like hand over your position in one binary market to someone else if you need to hold to maturity? Can you have netting etc.","offset":3171,"duration":39},{"text":"There's sorry many things to figure out.","offset":3210,"duration":3},{"text":"Host: Well, I really want to see- the freaks know, I just want to see native Bitcoin prediction markets with decent privacy guarantees. I think Liquid could be the holy grail for it. We'll see. Cautiously optimistic. I've been wrong about Liquid adoption multiple times, both on the bear side and the bull side. I think um I was probably too bullish at one point, then I was a little bit too bearish. We've recently seen more of an uptick in usage. Maybe the reality is somewhere in the middle, but I applaud you guys for continuing to build it out and see what works and see what doesn't and try and build out that key infrastructure to to help everything else grow. I would love if we can we do like an update show in like six months or something to see where we stand on all this stuff?","offset":3213,"duration":47},{"text":"Scott: I'd love that, I'd love that.","offset":3260,"duration":3},{"text":"Host: Awesome, okay. Scott-","offset":3263,"duration":2},{"text":"Scott: Yeah, go on.","offset":3265,"duration":1},{"text":"Host: Let's do something funner. So if we have this update in six months, prediction-wise where are we? Um you're going to in six months you're going to have a full-fledged Poly Market competitor for me.","offset":3266,"duration":15},{"text":"Scott: Let's make it an MVP of it anyway.","offset":3281,"duration":2},{"text":"Host: I mean where do you think- I'm obviously half joking, it's a big undertaking- what do where do you think Liquid and Sideswap will be in six months?","offset":3283,"duration":9},{"text":"Scott: I think we'll have the POC for it.","offset":3292,"duration":3},{"text":"Host: That's awesome, that's exciting.","offset":3295,"duration":2},{"text":"Scott: We're not very far- we're actually doing in the background a Satoshi Dice-type of structure. So we're building out a few like more betting type style of markets just to figure out what all the edge cases around Simplicity and just get the market mechanics correct. So we're heading in that direction towards the prediction market model but right now we're just doing the binary outcome type of contracts. So we need to get the order book correct where the order book is 0 to 100 instead of whatever the price of Bitcoin is.","offset":3297,"duration":30},{"text":"Right.","offset":3327,"duration":1},{"text":"Scott: And then we need to- so we have Liquid Connect built, but there's still a bit more work in that area. And then we need to figure out the whole oracle aspect to make that have integrity in some shape, form, regard which we don't have any clarity over just yet. Right now we just have a super simple oracle that's basically just signing the Bitcoin price. So that the contract can determine outcomes.","offset":3328,"duration":23},{"text":"Host: There might be something there- first of all that makes sense to me. I mean, you know, you do the little things to get comfortable and um improve your understanding and your execution before you actually go for the the big one. You know, Poly Market is using something called UMA, I don't know, it's like so hard to keep track of all this shitcoin stuff. They're using something called UMA's optimistic oracle where there's like a whole process on chain of an oracle determining the result of markets. Um and that's all on chain on some Polygon or different shit chain.","offset":3351,"duration":46},{"text":"But because it's all on chain, you might actually be able to just piggyback their oracles in the beginning because that's a hard thing- it's hard to get people to step up and be the oracles is like just a people problem um in the beginning. Um so you might actually be able to just hijack their oracles and just use the same resolution mechanism that they're using in terms of source of truth. If they're already signing cryptographic attestations on some chain out there of ton of markets, right? Like from weather to missile strikes to basketball games, then you could potentially just piggyback them until you have a um Liquid native alternative out there on the oracle side.","offset":3397,"duration":43},{"text":"Scott: We'll look into it. I know Blockstream's putting a lot of work now into the oracle because they're obviously big team now laser focused on Simplicity. So so they're also doing a lot of work around integrating everything. I think they're looking at some Wallet Connect feature.","offset":3440,"duration":15},{"text":"Host: Interesting. Fascinating. Scott, this has been great. Do you have any final thoughts for the freaks before we wrap here?","offset":3455,"duration":7},{"text":"Scott: Not much, just super happy if anyone's made it this far listening to us go on about Liquid and Simplicity and my favorite project Sideswap.","offset":3462,"duration":11},{"text":"Host: Love it. Um freaks, I'll have links to everything we discussed in the show notes. Like I said, you'll probably be listening to this in a couple hours. Um best way to support the show is sharing with friends and family. All relevant links at Citadeldispatch.com. Reminder to check out Citadelwire.com. I have uh already next week I have lined up on the calendar a conversation with Leia who is a co-founder of Vexel. They do P2P Bitcoin exchanges without KYC. So that'll be a great conversation keep an eye out for that. And uh play around with Liquid. Scott is looking for feedback, he's looking for more users, more people playing around with these things. I think all of it can be helpful. While we are in these bear market, it's always great to just dive into the tech and uh get your feet wet. Um there's no better time than today. Thank you Scott.","offset":3473,"duration":52},{"text":"Scott: Thanks Matt.","offset":3525,"duration":2},{"text":"Host: Thank you freaks. Stay humble, stack sats. Peace.","offset":3527,"duration":15}],"logs":[{"elapsed":"0.0","message":"Downloading podcast episode...","detail":null},{"elapsed":"5.8","message":"Episode downloaded (53.9 MB) in 5.8s","detail":"File size: 53.9 MB"},{"elapsed":"5.8","message":"Episode: CD194: SIDESWAP - LIQUID PREDICTION MARKETS","detail":null},{"elapsed":"5.8","message":"Uploading audio to Gemini File API...","detail":null},{"elapsed":"17.3","message":"Audio uploaded in 11.5s","detail":"File ref: files/rzlbwfg6thmg"},{"elapsed":"17.3","message":"Audio processed in 0.0s. 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