S15 E55: Jake Yocom-Piatt & Phoenix Green on Decred

Some people rage quit Bitcoin. Jake Yocom-Piatt did something stranger. In 2013 he and a small team of paid developers rewrote the entire Bitcoin full node from scratch in Go, the project that became btcd, and the reward for that work was hostility, a whisper campaign and zero income. He estimates he had spent "a couple million dollars" on it. So he pivoted, co-founded Decred, launched it in February 2016, and has been building it ever since, through bull markets, bear markets and one very persistent mining cartel.

I came to this conversation because Nicholas Gregory, the man behind Mercury Layer, told me Jake is the biggest privacy expert he knows. Jake played it down ("I don't know how much of a privacy expert people would consider me") and then spent three hours proving Nick right.

He was joined by Phoenix Green, a Decred community member who has spent the last few years explaining the project to newcomers and who brought along a lot of enthusiasm for Bison Wallet. We talked governance, mining, Lightning, block sizes, data centers, coin mixing, Zcash and Satoshi, and I closed with a live demo of the wallet. It is one of the most opinionated episodes of Season 15, and I mean that as praise.

The Man Who Rewrote Bitcoin Core

Jake's road into Bitcoin started with a failed product. His team had built Cyphertite, an encrypted offsite backup service, and when it went nowhere they looked at Bitcoin and decided to reimplement the full node from zero. Their first contact with the Bitcoin Core group was not what they expected. They offered to help with tests and to get things running on another operating system, and the response, in his words, was "instant hostility."

He is candid about what he is and what he is not. "I'm really more of a project manager than I am a developer," he told me. He steers, his people code. And what he learned while steering was that a second, independent implementation of Bitcoin was good for decentralization and bad for somebody's ego. People were told not to run their software. "I'm not the kind of person who gives up easily," he said, but at some point he had to ask where this was going.

The answer came from the BitcoinTalk forum. Two pseudonymous users, tacotime and _ingsoc, approached him with a white paper called MemCoin2 and asked him to build it. He hesitated for a few months, then agreed in early 2014 on the condition that they help him launch. It took two years.

What pushed him was a governance problem he saw up close: Bitcoin was meant to be one CPU, one vote, but once the hardware gets captured by one group, "that sort of governance mechanism, voting with your CPU, becomes compromised." Then he watched miners and developers fight for years over every change, while nobody could explain who was going to pay for the work. "Apparently venture capital money is the answer," he said, "or, as we're seeing, BlackRock."

Proof of Work, "a Dumpster Fire"

I asked Jake to describe the differences between Bitcoin and Decred in his own terms, and he gave me four. The first is consensus. Decred is a hybrid: miners produce blocks, but stakeholders lock coins into tickets that vote on blocks and on the direction of the project. "It is one CPU, one vote when you're mining, but when it comes to decisions for the project it's one coin, one vote," he explained.

The second is funding, solved with a treasury that takes 10% of the block reward. The third is privacy, which he frames as a matter of sovereignty: "Are you truly sovereign if somebody knows where all of your money is?" The fourth is the free exchange of coins, which is where Bison Wallet comes in.

His verdict on pure proof of work is harsh. Economies of scale and ASIC manufacturing mean the game ends up being about who sits closest to the silicon and the money, and for him that is mostly China. "Proof of work went from a great, fair idea to a dumpster fire," he said, adding that by 2013 or 2014 it was already one, even if he did not see the full extent then.

I played the role of the Bitcoin maximalist and asked the obvious question. If Decred fixed all of this, why is Bitcoin number one and Decred somewhere around rank 200? Jake had clearly heard this before. He said "our tech is rock solid" and nobody has ever blown up a piece of it, but price is a different game. "If you're dumb and you think that price action is the only thing that matters with cryptocurrency, well yeah, then it's irrelevant."

The Cartel That Did Not Want the Price to Go Up

Here the conversation got juicy. Decred launched with a split of 60% of the block reward to proof of work, 30% to stake and 10% to the treasury, and Jake says his biggest regret is not listening to the people who suggested the reverse. The reason is that miners "accumulated an enormous amount of Decred very quietly using ASICs and GPUs" and then, he claims, used that inventory to push the price around.

I pushed back with game theory. A cartel sitting on a mountain of coins should want the price to go up so it can sell into demand. He agreed that a rational, profit-maximizing cartel would do exactly that, which is why he described this one as "a malicious cartel as opposed to a benevolent cartel." The way they operated was not specific to Decred, which made him wonder how many other proof of work coins have the same player inside them.

He insisted this is not a vibe. When the original DCRDEX saw sustained bidding, several million DCR flowed through it, and the team started asking where those coins came from. A lot came from Binance, but large amounts came through exchanges he never expected, including one he described as a ghost town for DCR trading that suddenly moved around 800,000 coins.

Trace it back and you find clusters receiving small mining rewards, and only someone with ASICs can mine. "These claims I'm making are not just idle claims," he said. "These are claims backed up by on-chain analysis and cluster analysis." The side lesson he took from it is that some exchanges work as relays, where coins go in and come out with no real sale, which creates plausible deniability about who holds them.

Phoenix then reminded us what happened next, and this is the part I find most impressive about Decred. The stakeholders voted to change the reward split. DCP-0010 cut proof of work to 10% and gave stakers 80%. After more research showed miners were still very profitable, DCP-0012 took it down to 1% for proof of work and 89% for stake, with the treasury untouched at 10%. "That's real power to the coin holder," Phoenix said, and asked me to imagine how long the same fix would take in Bitcoin. Jake was more cautious about the result. "I hope we pivoted soon enough."

We also traded war stories about mining hardware. Jake's community members have been reporting "dusty miners" since 2012, machines that clearly ran in a warehouse before anybody shipped them. He used to run trade show booths a couple of spots away from Butterfly Labs and found the whole thing "always so sketchy."

Sovereign Money Comes With Homework

My counterpoint to proof of stake is the nation state. A government can print money, buy coins slowly and end up controlling the stake. Jake admitted there is "no good way to fully stop an adversary" from buying up any asset, but argued that it has already happened to proof of work through the people who make and run the ASICs. He also bet on human stubbornness. Stakers have a reason not to sell out, and he certainly would not. "I'm a man who will go down with the ship kind of guy. If somebody comes to try to buy everything out, I'm not for sale."

He also offered a sharp critique of how Bitcoin is governed today, which he called a "developer central planning committee," meaning "a committee that does not have skin in the game and makes decisions for everyone else." Such a system is easy to capture: pay talented people more, hype a figurehead, control the figurehead. Buying up the majority of stake is far more expensive.

What about seizing hardware from home stakers? Phoenix pointed out you can stake through Tor or from a VPS that never holds your coins. Jake went further: sovereign money is like physical gold, and someone can always show up with a gun. The answer is personal operational security, from disk encryption to decoy wallets.

He called himself "a computer security nut" and said hardware wallets are "kind of junk" for someone like him, while conceding later that for people without strong opsec, "hardware wallets are a big win, apart from the privacy angle." And he finds the trade-off acceptable. A custodian going bust and wiping out everyone at once is a worse failure mode than a thief going door to door, and in any case, "how do you know you didn't get my decoy wallet?"

Lightning as Hashcash

Before the episode, Nick Gregory had told me Decred's Lightning Network works better than what I experienced on Bitcoin. A day before we recorded, Donald Trump had made a Lightning payment for burgers at PubKey in New York through a custodial app, and it was not the instant, seamless experience everyone had been advertising. Phoenix was blunt about his own past. "My experiences with Lightning before Decred's Lightning was horrible."

What changed for him was Bison Relay, a messaging and social platform that pays for every message with tiny Lightning payments. Jake explained the idea with a nod to Adam Back's hashcash, which was designed to make spam expensive. Instead of asking for your phone number, your IMEI or, as he joked, "a stool sample," the system charges a microtransaction on both the sending and the receiving side.

"Everything you do is gated by a microtransaction," he said, and that removes the excuse for collecting metadata. It also gives DCR a real utility, because this is a use case where "this technology straight up would not work without microtransactions." His server relays several thousand messages a day, which would be impossible on-chain.

The second ingredient is SPV, lightweight clients that check block headers and use filters so they only download blocks that matter to them. Decred went a step further and made those filters part of consensus through DCP-0005, so any full node can serve them. On Bitcoin, light clients have to go looking for the minority of nodes that offer filters. Jake called committed filters "a no-brainer," the "low hanging fruit" for Bitcoin, with one catch: it needs a consensus change.

Ironically, the code running underneath much of Bitcoin's Lightning economy comes from his old team. LND is built on btcsuite, "work that I did back between 2013 and 2016 with the developers that I work with." He has warm words for Laolu, the CTO of Lightning Labs, whom he called "one of the fastest English language speakers I have ever met." And he told me about stumbling on a zero knowledge proof repository whose readme thanked btcsuite for being so clear and well commented, which made him think of his colleague Dave Collins.

His diagnosis for Bitcoin's custodial drift is that nobody planned it. Merchants want dollars, wallet makers want one-click onboarding, and that combination naturally produces custodial services. He cited estimates that around 90% of Lightning's consumer side is custodial. His advice is to focus on use cases where people send and receive bitcoin natively, because "the big idea with cryptocurrency is we're gonna move beyond fiat currency."

Big Blocks and the Man in the Data Center

Jake left Bitcoin before the block size war turned into a divorce, so I asked where he stood. Back then he leaned toward larger blocks, mostly because Core never really sold the case for Lightning; it was presented as take it or leave it. Over time he changed his mind, and his reason was not one I had heard before. Bigger blocks push nodes into data centers, and in his opinion big data centers are crawling with government people.

He told me about renting colocation space in Chicago, on a floor with thousands of empty racks, where every single time he showed up, someone appeared to work on a rack right next to his. His conclusion: "Anybody who thinks that running stuff in data centers is a path forward for a cryptocurrency network doesn't know the first thing about opsec."

I confessed that I am something of a 2017-style big blocker today, fine with very large blocks if they let people get in and out of layer twos without custodians. I told them about my own disappointment running a routing node, giving up and moving to Phoenix, Blixt and Breeze. Phoenix frowned at my 32 GB blocks ("like, whoa") and said his goal is that as many people as possible can run a full node, with SPV as the next best option. Jake framed it as trade-offs all the way down, and even admitted his own worst one: arguing with tacotime about the proof of work and proof of stake split. "I will live to regret that one."

Bison Wallet: An Exchange Without a Landlord

Phoenix found Decred about five years ago and was drawn in by the first atomic swap the team performed on air with Charlie Lee, which he remembers as "fiddly as hell" but successful. Then Jake published a post about turning swaps into an exchange. The logic was simple. If Bitcoin lets two people pay each other with no one in the middle, "why should exchange be any different?"

The backstory is pure 2017. Jake recalled Binance as a ghost town at the time, asking Decred to buy around $250,000 in exchange tokens to get listed. "We're not going to buy $250,000 of your ghost town tokens so that we can be a member of the ghost town." Every major venue had its own version: blistering listing fees, then a market maker who needs a comically large loan of your coins. "I feel like it's incredibly corrupt," he said. In May 2018 he wrote the proposal for a decentralized exchange that would not extract rent and would also get rid of front running.

That became DCRDEX, and Bison Wallet is its user-facing side. Phoenix said it has cost roughly a million dollars to get where it is. Trades are plain on-chain atomic swaps, so your bitcoin goes from one Bitcoin wallet to another and your DCR from one Decred wallet to another, with no exchange token in between. The only place Decred inserts itself is a small fidelity bond, around a dollar, which you get back if you behave. "It almost sounds too good to be true," Phoenix admitted, and that is apparently the main marketing problem.

During the demo I scrolled through the supported assets: DCR, BTC, LTC, DOGE, DASH, DGB, ETH, ZEC, Firo, BCH, Polygon and a handful of stablecoins and wrapped tokens on Ethereum and Polygon. Anyone can run a server and list what they want, which matches the project's "no gatekeepers" philosophy. You can set up market making bots, and a Bitcoin wallet created in one click is an SPV wallet that synced in minutes on my livestream.

Jake pointed out that swapping BTC for USDT without KYC is useful for any bitcoiner, but warned that "tether and these stablecoins are not permissionless." He admitted he lives on the command line and was seeing much of the interface for the first time, crediting Brian Stafford as the lead on Bison Wallet and DCRDEX.

Why no Monero? Because the swap protocol assumes both chains support Bitcoin-style script, and Monero does not, so adding it is "very much a non-trivial addition." Zcash works only by connecting to a full node, since there is no ready-made light wallet to plug in.

CoinShuffle++ and the Fear of Stealth Inflation

Phoenix showed the privacy toggle in the Decred wallet. Turn it on and your balance gets mixed, which costs "a fraction of a penny." He even suggested a route for bitcoiners: swap into DCR, mix, swap back out. The mixing comes from staking. With around 10 million of the roughly 16 million DCR locked in tickets, the constant flow of coins in and out of the ticket pool feeds large anonymity sets.

Jake explained that the system is based on CoinShuffle++, a non-custodial coinjoin design where none of the participants can tell whose output is whose. Decred made two notable changes. "We made it post-quantum secure," he said, by generating session keys with post-quantum public key cryptography in an extra phase. And they removed the coordinator. "Now it's all peer-to-peer." Even when there was a coordinator, he stressed, it only relayed messages and never handled anyone's extended public keys. On dcrdata I looked at a recent block and he walked me through a ticket split mix, with its fixed denominations and floating ticket denomination, which he compared to old-school Monero.

The most interesting idea in this section, for me, was his ranking of priorities. Privacy matters to him, but avoiding hidden inflation matters more. With shielded systems "you basically can't transparently audit the supply," and in a proof of stake chain, "if stealth inflation occurred with Decred, it would literally destroy the project," because whoever inflates could take over staking. He is also wary of complexity. Auditing generic zero knowledge proof code, he said, requires at least master's level mathematics. He thinks Zcash "would have taken off in a different way" with privacy on by default, and recalled Ian Miers telling him in 2016 that the transparent side existed for compliance and exchange listings.

I showed him the Wasabi coordinator run by Kruw, which had mixed over 3,700 BTC with no fees, as an example of one brave individual carrying a torch. Jake supports that, but thinks Bitcoin Core should have built mixing at the project level a decade ago. Now, he said, it is very hard "to put the crap back in the horse," because exchanges have normalized asking where every coin came from.

On Samourai, he was blunt: "It's a non-custodial service. Doesn't matter." Two of its developers later pleaded guilty and were sentenced in late 2025, and I covered the wider damage in On the Limitations of Bitcoin Privacy. His darkly funny silver lining for Decred is "one of the luxuries of not having a lot of NGU": nobody is sending law enforcement after your developers.

Holdings, Provocateurs and Open Source Pride

A viewer in the chat said it is incomplete to discuss a governance coin without asking the creator about his holdings. Jake clarified he is one of three founders, not the founder, and that the terms of Decred's small premine were public at launch. Beyond that, he said demanding a founder's balance sheet in order to judge a technology is "clownish at best," like asking someone how much is in their bank account, and no answer would ever satisfy the people asking. He also described a handful of persistent provocateurs who tried to worm their way into the project and turned hostile once he opposed them.

I asked why Decred is still here when most of the 2017 ICO class is dead. His answer was open source. He has run open source software for decades, from OpenBSD to his own servers, and he came for sovereign money after seeing what happens "when people turn off your bank account." He does not like the Silicon Valley and Wall Street habit of hyping "toxic sludge" and dumping it on retail. "Most people in the space, the first open source software they ever worked with was cryptocurrency," he said, "and they're here to pump and dump on you."

He also explained, with real empathy, why Core developers were hostile to him back then. They were volunteers working for pride, and he showed up with money and a paid team. "I get it." The proof that his work mattered, for me, is that btcd is still maintained and used long after he moved on.

Does he feel ahead of his time? Absolutely. He paraphrased the saying that if you are a few years ahead of the curve people think you are a genius, but if you are ten years ahead they think you are insane. To him the hybrid consensus is like an alloy. "This is like the steel of the blockchain space," he said. I told him Zooko once confided a similar frustration to me privately, about being early to zero knowledge proofs and not seeing Zcash grow the way he hoped.

Fairer Games

Toward the end we talked about the future. Jake can see Bitcoin reaching around a million dollars against today's dollar, with more institutional ownership, fewer coins moving and less sovereign use. When I said I was not very bullish on the $100,000 target the ETFs were supposed to deliver, neither of us guessed it would get there about two and a half months later, in December 2024. He expects capital to eventually look past Bitcoin and into other chains, and he wants Decred alive for "20, 30, 40, 50 or 100 years."

We also talked about voting, which Bitcoin's high priests love to hate even though, as Jake put it, "proof of work is just voting with a CPU." I brought up Satoshi's email asking Laszlo Hanyecz to stop mining with GPUs, and Jake loved it. To him the whole industry is about "creating fairer games," and the eternal opponent is "somebody out there who's a jerk who wants to turn that fair game into some rigged garbage."

Satoshi, it turns out, had his own problem with miners too. His last thought before his kids came home was that the white paper, the full node and the GUI were very different skill sets, and he does not think "there's any way" they were all the work of one person.

Whether you agree with his hybrid model or not, Decred has done something rare: it caught a structural problem in its own design and used its own governance to fix it, while Bitcoin argues about the same issues year after year. As Jake signed off: "The revolution will not be centralized." You can find him as @behindtext, the project at @decredproject, and the community at chat.decred.org. If you like this kind of history, my Bitcoin Forks, Described by Dorks piece is a good next stop.

Listen to Jake Yocom-Piatt & Phoenix Green on Spotify, Apple Podcasts, YouTube, and More

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Time stamps:

00:00:11 – Introducing Jake & Phoenix
00:01:23 – Jake's Background
00:02:48 – Creation of Decred
00:04:41 – Challenges Faced in Bitcoin Development
00:06:11 – Initial Steps Towards Decred
00:07:20 – Governance Issues in Bitcoin
00:09:01 – Phoenix's Introduction
00:10:03 – Overview of Bison Wallet
00:10:52 – Phoenix's Journey with Decred
00:11:55 – Atomic Swaps and Bison Wallet
00:12:57 – Bison Wallet Development Costs
00:17:48 – Philosophy Behind Bison Wallet
00:18:18 – Corruption in Traditional Exchanges
00:20:58 – Bison Wallet Features Explained
00:21:52 – Differences Between Bitcoin and Decred
00:23:05 – Consensus Algorithm and Its Issues
00:24:02 – Governance Problems in Bitcoin
00:24:54 – Funding Challenges in Bitcoin
00:25:48 – Importance of Privacy
00:26:46 – Decred's Unique Approach
00:28:01 – Market Perception of Decred
00:28:33 – Challenges with Proof of Work
00:29:49 – Market Manipulation by Miners
00:33:22 – Malicious vs. Benevolent Cartels
00:36:21 – Historical Mining Equipment Issues
00:38:58 – Consensus Upgrade for Control
00:40:16 – On-chain Analysis of Market Behavior
00:43:02 – The Decred Project's Flexibility
00:43:54 – Challenges of Mining Rewards
00:44:53 – Evolution of Mining Dynamics
00:45:35 – Geographical Arbitrage in Mining
00:46:07 – Fairness in Mining
00:47:11 – Participation in Mining
00:48:31 – Inflation and Interest in Decred
00:49:53 – The Role of ASICs in Mining
00:50:37 – Nation-State Threats to Cryptocurrency
00:53:05 – Manipulation of Bitcoin Prices
00:54:20 – ETFs and Institutional Control
00:56:19 – Proof of Stake vs. Proof of Work
00:59:49 – Compromise of Bitcoin's Integrity
01:02:03 – Sovereign Money and Personal Responsibility
01:02:30 – Security in Digital Assets
01:04:26 – Optimistic Views on Bitcoin's Future
01:05:16 – StarkWare and ZK Rollups
01:05:16 – LayerTwo Labs and Drivechains
01:06:25 – Decred's Lightning Network Implementation
01:07:24 – Bison Relay and Privacy
01:10:08 – Challenges with Bitcoin's Lightning Network
01:12:49 – SPV and Lightning Network Integration
01:16:09 – Microtransactions as Anti-Denial of Service
01:18:24 – Decred's Unique Use of Lightning
01:20:34 – Recommendations for Bitcoin's Lightning Network
01:23:43 – Bloom Filters and Their Issues
01:24:01 – Frustration and Adaptation
01:25:37 – Consensus Changes and SPV Clients
01:26:27 – Challenges of Vendor Preferences
01:28:07 – Moving Beyond Fiat
01:29:00 – Block Size Debate Reflections
01:30:00 – Observations on Data Centers
01:32:00 – Evolution of Opinions on Block size
01:36:30 – The Need for Efficient Blockchains
01:39:17 – Trade-offs in Scaling
01:40:54 – Governance Challenges in Bitcoin
01:42:14 – Disclosure in Governance Coins
01:43:31 – Discussion on Coin Holdings and Privacy
01:45:20 – Challenges with Provocateurs in Crypto Projects
01:46:56 – Introduction to Bison Wallet Demo
01:48:16 – Overview of Hodling.ch
01:49:25 – Bison Wallet Interface Walkthrough
01:52:54 – Functionality of Bison Wallet
01:56:06 – CoinShuffle++ Explanation
01:59:24 – Creating a Bitcoin Wallet in Bison
02:02:27 – Network Level Privacy in Bison Wallet
02:03:36 – Conclusion and Farewell to Phoenix
02:05:35 – Wallet Functionality and Filters
02:06:32 – Monero's Atomic Swap Challenges
02:08:40 – Zcash Wallet Limitations
02:09:55 – Tether and Ethereum Wallets
02:11:03 – Bison Wallet Features
02:12:22 – Ethereum Account Generation
02:13:58 – Backing Up Wallets
02:15:36 – Concerns with Hardware Wallets
02:16:06 – Experience with Decred and Bitcoin
02:19:47 – Decred's Longevity and Community
02:20:14 – Principles Behind Decred's Development
02:23:49 – Legacy of Open Source Contributions
02:25:48 – Consensus Algorithms and Innovation
02:27:03 – Frustrations with Recognition
02:27:59 – Community Dynamics in Cryptocurrencies
02:29:07 – Zcash's Default Privacy Issues
02:30:08 – Challenges of High-Level Teams
02:33:21 – Privacy vs. Stealth Inflation
02:35:01 – CoinShuffle++ Explained
02:36:37 – Cost to Attack Analysis
02:38:39 – Mixing Techniques in Decred
02:40:10 – Wasabi Wallet and Decentralization
02:43:14 – Bitcoin's Privacy Future
02:45:02 – Implications of Recent Arrests
02:46:49 – Bitcoin's Future
02:49:22 – Decred's Longevity
02:50:43 – Challenges in Bitcoin Governance
02:52:11 – Voting in Bitcoin
02:56:16 – Satoshi's Vision
02:58:39 – Learning About Decred