S14 E6: Mike in Space on STAMPs and Attacking Bitcoin

Mike in Space’s journey into the world of Bitcoin began with his popular show Bitcoin Car Talk, back in 2016. His latest venture, STAMPs, is a unique take on NFTs – the acronym stands for “Secure Tradable Artifacts Maintained Permanently.” The digital art is stored on the blockchain, a concept that sparked a lively debate across the community. While some folks really like the idea of permanent storage across all validating nodes, others consider that STAMPs are a full-fledged attack on Bitcoin – especially due to the way in which these transactions bloat the UTXO set and overload the RAM of nodes.

The STAMPs Debate: Storing Images on the Bitcoin Blockchain?

The question of whether storing images on the blockchain is necessary is rather philosophical and mostly concerns the degree to which Bitcoin is permissionless. Mike in Space believes that Bitcoin should have multiple use cases, even if they’re non-monetary in nature. Among these use cases, he sees value in the persistent storage of art on the blockchain. To many, this feels wrong and against the purpose of the Bitcoin network. But who decides what is the right way to use Bitcoin, as long as the users pay the fair fees to the miners?

The Philosophical Debate: Maximizing Bitcoin’s Use Cases

Some argue that adding arbitrary data to the blockchain is not transactional and serves more of a collector’s or archival purpose. Mike in Space, however, believes in maximizing the use cases for Bitcoin. He sees paying fees to store art on the blockchain as a valid transaction, a perspective that was shaped by the success of Ordinals, another project that enables data storage in Bitcoin transactions.

The Trade-Off: Immutability vs. Art

The conversation took a turn towards the trade-off between immutability and the importance of art in the context of NFTs on the Bitcoin blockchain. Artists and collectors need to decide how important immutability and permanence are to them. Some people may not care about the art or the persistence of data. Maybe that they’re only interested in flipping NFTs for profit. However, for artists who value their work and want it to be preserved for future generations, alternative solutions like STAMPs might be worth considering.

The Argument: NFTs on Bitcoin Affect Remittances

The argument that NFTs on Bitcoin hinder cheap remittances and fees in countries like El Salvador and the Central African Republic was brought up. Mike countered this by mentioning that a few years ago, the ideal fee market was considered to be $100 per transaction. He argued that fee pressure is necessary as the block subsidy decreases over time, and Bitcoin needs use cases like art to drive fees up.

The Criticism: NFTs on Bitcoin vs. Other Use Cases

Some people criticize NFTs on Bitcoin while ignoring other use cases like Microstrategy putting their entire payroll on the blockchain. Mike questioned whether similar criticisms can be applied to Wasabi Wallet, emphasizing that all valid Bitcoin transactions are important for supporting the network.

The Value of Bitcoin Transactions

Mike addressed the criticism he receives from Bitcoin maximalists, stating that those who don’t understand the fee market and the system are not true maximalists. He considers himself a Bitcoin maximalist and finds it amusing when people proclaim the death of Bitcoin or certain use cases every time there is a price drop.

Introducing Bitcoin STAMPs

Mike in Space introduced Bitcoin Stamps, a protocol he created. Stamp Chain is one of several explorers for Bitcoin Stamps, which come in different types such as fungible tokens (SRC-20), non-fungible tokens (SRC-721), and art. The use of Bitcoin Stamps has attracted users from other networks like Ethereum, which requires them to acquire Bitcoin – thus benefiting the Bitcoin ecosystem.

The Purpose of Tokens

When asked about the purpose of these tokens, Mike mentioned that they can be used in smart contracts, liquidity pools, and decentralized finance (DeFi) applications.

The Concern: Inappropriate Content on the Blockchain

Naturally, given the nature of the average Twitter debate, I raised concerns about the potential for inappropriate content, such as child pornography, being stored on the blockchain. Mike acknowledged this concern but pointed out that the nature of STAMPs, which mostly includes pixel art and heavily compressed files, makes it unlikely for high fidelity images or videos to be stored. He also mentioned that directories can decide to censor such content at the web level, although it would still remain on the blockchain.

The Importance of Decoding Methods

Understanding the proper decoding methods to interpret the encoded data is crucial. Mike explained that different methods have different trade-offs, and the current method is the most resilient they have come across.

The Conspiracy: Miners Increasing Fees

I raised concerns about miners conspiring to increase fees during a less profitable time. Mike dismissed this as a conspiracy and suggested that if someone doesn’t like the fees, they can outcompete the miners by paying higher fees.

The Inclusion of Copyrighted Characters in STAMPs

We discussed the inclusion of copyrighted characters in stamps and the ethical implications of using Bitcoin in a way that makes it harder and more expensive for others to use. Mike argued that Bitcoin’s fee market and the exclusion of some users are inevitable and part of the system’s design.

The Popularity of On-Chain Art

We discussed the popularity of on-chain art and the limitations of layer 2 networks like Liquid. Mike in Space believes that the market decides what it wants, and it’s clear that on-chain art, as proven by projects like Ordinals and STAMPs, is what the market prefers.

The Appeal of NFTs?

We talked about the appeal of NFTs that relate to Bitcoin culture and capture moments in history. I mentioned a pixel art of Greg Maxwell and discussed the trend of Bitcoiners trying to dictate usage, which I see as a form of scaling and preventing potential issues with the network.

The Infrastructure Concerns

I raised concerns about the infrastructure if too many STAMPs are broadcasted simultaneously. Mike in Space explained that transactions are held in the mempool until they are included in a block, and if necessary, users can outcompete others by offering higher fees.

The Shill: Bitcoin Heads

I reminded Mike that he is part of the Bitcoin Heads collection on Counterparty and Ordinals. The cards featuring his head can be purchased from a dispenser for 12,000 baby bitcoins a piece (approximately $3). I believe the collection is underrated and encouraged viewers to support the show by collecting them.

The Future of STAMPs

Mike in Space expressed his confidence in the collection’s value, at least for the moment. We discussed the possibility of the Ordinal inscriptions being affected if Luke Dashjr decides to “nuke” them, referring to discussions happening on Bitcoin forums. However, Mike acknowledged that he can only go by the information available and doesn’t have a definitive answer.

In conclusion, my discussion with Mike in Space, the creator of STAMPs, was a deep dive into the world of NFTs on the Bitcoin blockchain. It was a fascinating exploration of the philosophical debates, technical aspects, and future possibilities of this use case for Bitcoin.

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Time stamps:

Introduction of Mike in Space and STAMPs [00:01:11] Vlad introduces Mike in Space, the creator of STAMPs, and discusses the concept of permanent Bitcoin NFTs and their unique name.

Discussion on Storing Data on the Blockchain [00:04:04] Mike in Space explains how STAMPs are stored on the blockchain and the advantages of their persistence compared to other data storage methods.

The immutability and permanence of NFTs [00:12:12] Discussion on the trade-off between immutability and permanence of NFTs, and how artists and collectors should consider their importance.

The importance of fee market and criticism of STAMPs [00:14:25] Mike in Space defends the fee market and addresses criticism of STAMPs, highlighting the role of miners and the need for fee pressure.

STAMPs and Ordinals Use Cases [00:22:45] Discussion on the validity of different use cases for STAMPs and Ordinals on the Bitcoin network.

Market Slowdown for STAMPs [00:23:56] Observation of the decrease in market enthusiasm and fees for inscribing art and messages on the blockchain.

Different Use Cases for STAMPs [00:27:08] Explanation of the various use cases for Bitcoin STAMPs, including fungible and non-fungible tokens, as well as art.

Child porn concerns [00:34:07] Discussion about concerns regarding the presence of child pornography on the blockchain and the limitations of file size and content in STAMPs.

Data encoding and multisig outputs [00:35:48] Explanation of how STAMPs data is encoded and split into multisig Bitcoin outputs, as well as the need for proper decryption to view the data.

Value and use cases of STAMPs [00:43:33] Discussion on the value of STAMPs as collectible art, the community’s enjoyment of trading and sending memes, and the impact on the blockchain’s data size.

Bitcoin as a Free Market [00:45:13] Discussion about how Bitcoin operates as a free market and the idea that Bitcoin is for anyone, but not necessarily for everyone.

Ethical Issues of Bitcoin Usage [00:46:38] Debate about the ethical implications of making it harder and more expensive for others to use Bitcoin.

The End Game of Bitcoin Fees [00:47:25] Exploration of the end game of Bitcoin fees, including the inevitability of some people being left out of the economy due to fees.

The persistence of on-chain art [00:55:38] Discussion about the market preference for on-chain art and the failure of off-chain protocols like Liquid.

STAMPs and Stamp Punks [00:56:58] Explanation of the STAMP project and the minting of Stamp Punks on the platform.

Using hot wallets for NFTs [00:59:26] Discussion about the practice of using hot wallets for NFTs and the desire to showcase NFT collections on a single reusable Bitcoin address.

The dispenser for Bitcoin collectibles [01:06:31] Vlad mentions a Counterparty dispenser where viewers can purchase Bitcoin Heads for ~$3 a piece.

Discussion about the future of Bitcoin collectibles [01:07:15] Mike in Space mentions that Ordinal inscriptions will be good until Luke “nukes” them, speculating a potential change in the future.

Selling Bitcoin genesis block on a floppy disk [01:08:21] Mike in Space talks about selling the Bitcoin genesis block encoded on a floppy disk, highlighting the physical nature of the item.

Vlad Costea

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