In January 2009, Finnish computer scientist Martti Malmi was looking for a way to change the world. Since he was disillusioned with the world of politics, he thought trying to fix the money would be a worthwhile endeavor. So when he searched for decentralized money projects on Google, he stumbled upon the Bitcoin.org webpage. This simple search engine query has changed Martti Malmi’s life: he became the first collaborator of Satoshi Nakamoto’s, and the first person to write educational content about Bitcoin.

But his contributions didn’t stop at writing FAQs: he also coded plug-ins and worked on the Linux port of the Bitcoin software. In this interview, Martti Malmi (aka Sirius) brings back the spirit of the early days of Bitcoin. And for those of you who are trying to figure out who Satoshi Nakamoto might be, he also offers his perception of the person behind the pseudonym. Also, you can learn more about a true OG’s adventures in the land of Nostr and the Lightning Network.

This episode was recorded at Paralelni Polis in Prague, during Pizza Day 2024.

Listen to Martti Malmi talk about the early days of Bitcoin and Satoshi Nakamoto on Spotify, Apple Podcasts, YouTube, X/Twitter and more!

Special thanks to the sponsors who made this episode possible: SideShift.ai, LayerTwo Labs, Citrea, NoOnes, Bitcoin.com News, and NoOnes.com.

Full Transcript:

Vlad Costea 00:00:48 You are listening to season 16, episode 12 of the Bitcoin Takeover podcast featuring Martti Malmi, the first Bitcoin developer to join Satoshi back in 2009. This episode is sponsored by LayerTwo Labs, SideShift.ai, Bitcoin.com news, Citrea, NoOnes.com, and HODLing.ch. One thing that I have to mention is that we recorded this interview back in May of 2024, during Pizza Day at Paralelni Polis. So some of the ideas expressed might be slightly dated, but nonetheless, I’ve decided to keep this interview and publish it on a special occasion. I hope you will enjoy it, because Martti really doesn’t do a lot of interviews. He doesn’t like to talk a lot. He’s rather introverted, but I do believe that in this interview he gave some interesting answers. And much more than that, this interview will help you understand the mindset of the people who contributed to Bitcoin very early on and what kind of expectations they had and what kind of work they might be doing today.

Vlad Costea 00:02:03 So enjoy. Hello and welcome to the Bitcoin Takeover podcast. I am Vlad and I’m here today with Sirius, was the first Bitcoin developer in the world. And one of the people who spoke with Satoshi and his name, his real name is Martti Malmi. He’s from Finland. He was in university when he first discovered Bitcoin and he wouldn’t advise Satoshi, who was complaining to him, how to present the project to the Peer to Peer Foundation forum. When it was announced for the second time in 2009. And there’s quite a lot to talk about. I don’t even know where to start these days you’re working on a Nostr client, which is called Iris. Yes. And to you is new store just as exciting as Bitcoin was back in the day?

Martti Malmi 00:02:53 Yeah, yeah, it is in a way. what? Bitcoin started pretty small and when I joined, Nostr was already pretty big. I started working on well, I had worked on Iris for a fairly long time, since 2019 or something, but on a different stack.

Martti Malmi 00:03:14 Then 2022, Jack Dorsey started using Nostr, and then when that’s when it got popular and I made Iris nostro client, it was already technically very similar. So it happened quickly.

Vlad Costea 00:03:31 I was one of the first people to just Nostr because I’m friends with Ben Arc, and he added me to a Telegram chat where there was Ben Arc, there was Fiatjaf, there was what’s his name, Melvin Carvalho. Yeah. Rockstar Dev and a bunch of others were coming up with ideas. Brainstorming how they can build their idea at that time was mostly political. They wanted to build a version of Twitter that is much better than Mastodon and cannot be politically censored. So that’s how they came up with the idea. And now, if I’m not mistaken, stands for nodes and other stuff.

Martti Malmi 00:04:09 Transmitted over relays.

Vlad Costea 00:04:11 Transmitted over relays, you know?

Martti Malmi 00:04:13 Yeah, it’s like the only actually self custodial social network as far as I know where the accounts are just public keys just like your Bitcoin wallet. And you don’t need a service provider.

Martti Malmi 00:04:26 No one can take it away from you. And actually the transmitted over relays part is optional as well. You can use whatever transport you could send to send messages on floppy disks or in mail or, or Bluetooth or whatever. Peer to peer configuration.

Vlad Costea 00:04:44 Yeah, it’s really exciting. I feel sorry for losing my keys because I tested it very early on. It was a client called Branle made by Fiatjaf and I created that. I just saved the keys in my browser history. And of course, I got a new computer and I transferred the data. And then I realized, okay, lost my keys. No big deal. I made a new account like 2 or 3 years ago when it had a resurgence. But I still regret that. I mean, I still have the public key. I can identify that one, but I don’t have my public key anymore.

Martti Malmi 00:05:17 You can just backdate the post. There’s no open time stamps or anything, so you can just make a new post sends it back that dates.

Vlad Costea 00:05:25 Oh yeah. But that that sort of defeats the purpose. I just wanted to have one of these first created accounts. I think that was one of the first 100 people to use Nostr, and it’s exciting because I wasn’t one of the first people to discover a Bitcoin. And when I heard about it the first time, I thought it was a stupid idea and it took me. So I was 21 years old when I first heard about Bitcoin, and this was the year 2013? Yeah. So it was when that bull market was happening and I saw a meme on the internet. I was scrolling a lot of meme pages in university. It was called 9gag com. And I saw a joke about. So someone was trying to rob someone else saying, hey, give me all your money. And that person said, I don’t have any money, I just have Bitcoin. And then the thief basically gave him some dollars, being like, oh, I feel so sorry for you. And I saw that and I was like, what’s bitcoin? So I searched for it and I read a bit about it and I said this is not for me.

Vlad Costea 00:06:27 It was the era of the Silk Road. I guess I was thinking, so this technology is being used to send money to anyone else around the world. And I was thinking, yeah, the narrative which was dominant at the time was to to bank the unbanked. And I was thinking, I already have a bank account, so why why would I need this? What’s the point? I was super naive in my assumptions because I thought I can send money to anyone around the world, when in fact I can’t even withdraw all of my money from my account. I mean, I didn’t have enough money to reach the limits, but once you start making more and you’re thinking, do they really have my cash inside of these ATMs, or can I get everything? No you can’t. If you want to close your bank account there, they’re going to schedule a call with the bank manager. And you’re going to have to explain why you want to do this and why you want your money in cash, which is strange.

Vlad Costea 00:07:21 So it wasn’t until I actually started working at the age of 25 that I understood the value. No, I was 24, that I understood the value of Bitcoin, but I kept following it and I wrote about this in my magazine. I told you about it, and I started from this idea that I thought it was a stupid idea, and it took me a few years of just stumbling upon it once again until I gave it a chance. And I don’t want other people to get the same roadblocks, to follow the same process. Because I think we as humans should learn from each other’s mistakes if we want to actually evolve. Otherwise, we’re just going to be repeating the same cycles, which is not a good idea. But I admire you because you saw something in Bitcoin that nobody else has. In a time when it was just software published on a page and it was only for windows.

Martti Malmi 00:08:15 Ten.

Vlad Costea 00:08:16 How did you discover this?

Martti Malmi 00:08:21 so I wanted to change the world through technology rather than politics. And I figured money would be the most impactful thing to change because everything runs on money, economy runs on money.

Martti Malmi 00:08:37 And I tend to agree with the theory that even our culture and the whole society runs like downstream from economy. But money can create a lot of bad culture and Bitcoin can fix it. So I went looking for monetary alternatives. There were some centralized options like Egold and Liberty Dollar and whatever. some of them were like, trust me bro. We have gold in our vaults. then I guess Liberty Dollar was later shot down by the government. They were all centralized, but I guess I was googling for something like peer to peer currency. And then Bitcoin came up and had just been published. There was this plain and simple bitcoin.org main page. And I read the white paper, took some time to digest it, and sent the email to Satoshi to offer help.

Vlad Costea 00:09:41 Was it really that easy to go from someone who stumbles upon this idea to become an becoming a developer for the project.

Martti Malmi 00:09:48 Yeah, well, I guess it took a couple weeks. Like to, research this stuff or more. but, yeah, I mean, Satoshi gave me gave me, like, right away.

Martti Malmi 00:10:04 Gave me access to the SourceForge, Bitcoin SourceForge. Net page, which was empty at that time. or open source contributors are usually valuable. So better be a commodity, accommodate it.

Vlad Costea 00:10:22 And for people who don’t know before Bitcoin was on GitHub it was on SourceForge. Yeah, I don’t think anyone still maintains that repository on SourceForge. But it’s interesting how this all started. So it took you two weeks to go from someone who first discovered Bitcoin to coding for it, but do you remember what was your first contribution to the project?

Martti Malmi 00:10:45 Well, actually, he first asked me to do a FAQ and some texts for the website and stuff like that. Then later I set up the forums. You can read our email exchange which you can find it on my Twitter, for example. There’s a lot of exciting discussion about WordPress configurations and whatever CMS or forum software we used. So that’s what I did first. And during the summer of 2009, I also got the code compiled on my computer and started making some minor minor, UI features, mostly like minimize the tray, so like and start on system boot.

Martti Malmi 00:11:34 So more people would stay online and keep the network running. and also worked on the Linux port, although Satoshi did some of that as well.

Vlad Costea 00:11:48 That’s interesting because I’ve spoken with Brian Bishop, and he told me that he found out about Bitcoin because he was on the mailing list, and when he saw it on Windows, she was like, oh, this is a piece of crap. Why would anyone want to build a future of money on Windows? And she didn’t actually get involved until there was a proper Linux port. So I guess you’re important in this regard because you got a lot of people involved when Bitcoin came to Linux.

Martti Malmi 00:12:16 I hope so.

Vlad Costea 00:12:18 Oh you know so because it’s empirical evidence.

Martti Malmi 00:12:21 Yeah. And I needed it for my own server because I wanted to build. And later I did build an exchange service Bitcoin exchange.com where I needed this API to create Bitcoin payment addresses. So I was, It was not like an order book style page. It was basically just me buying and selling with automated pricing, but it was not very profit oriented.

Martti Malmi 00:12:53 I didn’t want to go through the hassle of accounting and paying taxes, so I didn’t want to take any profit from the business or the venture or whatever. so I just had some automated pricing script, and I ended up having 30,000 Bitcoin less when when I ended the exchange than when I started.

Vlad Costea 00:13:18 At the time. How much was 30,000? Bitcoin?

Martti Malmi 00:13:23 Not too much. Could have been like €2,000 or less like usually the orders were pretty small at bitcoin exchange.com like someone buys Weisser sells for €20. But I remember when I got the first. Someone first purchased Bitcoin for €1,000 and I was like, whoa, this is getting crazy. I think he got like 10,000. Why can I use some exponential exponential curve for the pricing algorithm? So the more you wanted to buy, the more the unit price would be.

Vlad Costea 00:14:04 At the time, there was no other third party to tell you what the price is, so you had to determine it according to your own criteria.

Martti Malmi 00:14:12 Yeah. Yeah. I guess there was no Liberty standards.

Martti Malmi 00:14:17 The exchange, the web page, the guy who who might sell the, first known Bitcoin to USD transaction where he bought 5000 Bitcoin for 5 USD from me.

Vlad Costea 00:14:32 Yeah.

Martti Malmi 00:14:33 Yeah, yeah, yeah. He maintained this website with price listings and specialty shop where he could buy SpongeBob stickers and other specialties.

Vlad Costea 00:14:45 You know what’s funny about the story? I mean, there’s also the one about you buying an apartment, which I think makes you a pioneer in buying real estate with Bitcoin.

Martti Malmi 00:14:53 Yeah, well, I bought my house. I mean, I’m excited for your first, but. Yeah.

Vlad Costea 00:15:01 But what’s funny about the story is that you’ll get a lot of new bitcoiners who will say, oh, this guy is such an idiot. You know, he had no, no conviction in this money system. No belief. He just sold it for $1 or whatever.

Martti Malmi 00:15:15 No, I don’t get a lot of that. Everyone’s like, I would have sold as well, but my purpose was not to sell everything. I.

Martti Malmi 00:15:23 I sold like a bit over half of my remaining. I had like maybe 20,000 bitcoin left at that point, and I sold a bit over half of it, but then Bitcoin exchange rate dropped to like $2. That’s year 2011. And I had to sell a lot of it at a low exchange rate. I had resigned from my job as a junior software developer, and finding a new job took longer than expected. And I went traveling to Japan and everything and burned too many bitcoins. But but I can’t. I don’t really feel like I’ve lost anything on this journey. Quite the contrary. Now that at least I got more than two bits.

Vlad Costea 00:16:18 It’s funny because we are right now at Pizza Day, which is an event that celebrates Laszlo’s purchase of two pizzas for 10,000 Bitcoin. And we had pizza, we had drinks. This is Paralelni Polis. I guess they’re going to rebrand starting next year. I don’t know about that, but it’s a lot of fun and it’s a nice way to remember what this used to be about.

Vlad Costea 00:16:38 And it’s important to build markets, you know, because people if you’re never going to sell, as some people claim these days and they’re going to hold forever, you’re not going to create the demand for the currency. You need people to actually own some coins for them to want more of it. If you just hoard them and they’re like 100 people around the world who use it, that’s not how you scale it. That’s not how you get more adoption. That’s not how you increase the price. You need more people to want it. So how do they want it? They need to hold some of it first, and then they understand what it is and they’re going to want more.

Martti Malmi 00:17:14 Yeah. Well, I could still have, saved a few a few more.

Vlad Costea 00:17:23 Oh, really? You have some regrets about the way you spent your Bitcoin?

Martti Malmi 00:17:27 no. I mean, There’s sometimes there. There’s problems in life that money would solve. But sometimes it gets you thinking like, what if? But but, It’s no use.

Martti Malmi 00:17:40 spending time dwelling on the past. Future is the thing you can change.

Vlad Costea 00:17:47 In the present, not just the future. It’s what you start doing now. Yeah, but it’s really fascinating how those days were. And I was going to ask you something else, but before that. So I have some sponsors. I can just play the audio on top of this. Hold up a minute. Did someone just pay you in stablecoins? Swap that CBDC wannabe for free market scarce and provably yours BTC with SideShift. Why do you want to swap your BTC for something else? Use side shift the direct to wallet It exchange. It’s fast. It has lots of liquidity for your needs and the fees are lower than you might expect. SiteShift is also available via integrations with Trezor Suite and BTC Pay server. Check out SideShift.io today. And yes, you can also use SideShift to dump every other coin and token to make more BTC. Keep stacking, man! SideShift.io

Vlad Costea 00:19:18 Hey Anon, when was the last time you read the news on Bitcoin.com? And if you are into researching the geopolitical impact of Bitcoin outside of the US, or you simply want to compare the performance of BTC against gold, silver or natural gas. There’s always some content for you. While other publications are more political and display a higher degree of partisanship, news that Bitcoin.com is more neutral. So give it a try.

Martti Malmi 00:19:49 Wasabi wallet is really cool. Seems like a great business model as well until you get canceled by the government. I hope we can do improved Bitcoin privacy with, with other means that cannot be canceled.

Vlad Costea 00:20:09 Now, I was going to ask you this because you were the first developer to work on Bitcoin and you did some useful work. And Hal Finney actually, he was the first developer, if we put it this way.

Martti Malmi 00:20:23 As far as I know. He did testing around the early days. He did. I think he later contributed something to Bitcoin Core code.

Vlad Costea 00:20:35 So he tweeted very famously that he’s running Bitcoin. And then a week later he said looking for ways to improve privacy on bitcoin.

Vlad Costea 00:20:44 And I was thinking, if you had similar thoughts around the time that you realized, okay, this is not really private.

Martti Malmi 00:20:50 Yeah, I didn’t think too much about it at that time because we were under the radar at the time. I was aware that, like, it’s it’s it’s a public ledger, so you need to be careful. What? But I’m just a web developer. I don’t really know.

Vlad Costea 00:21:16 Did you look into other privacy proposals over the years and think, oh, this is so cool, we can have this in Bitcoin?

Martti Malmi 00:21:26 I don’t know. Not really. Not really. I guess the important thing to me about Bitcoin has been like the challenging the of the money printer first and foremost. Privacy is important of course, as well. I guess Lightning already does its fair share. And here, here at Pizza Day I’ve learned about Cashu, which is very interesting. Like a cache. There’s good stuff going on which has been discussed here.

Vlad Costea 00:22:04 But I do believe that Bitcoin can challenge the money printer and still be completely KYC in the sense that every transaction has an identity and use custodians for most transactions.

Vlad Costea 00:22:18 And I think that sort of defeats the purpose. I don’t know. Did you believe this or do you think it’s fine?

Intro Music 00:22:24 Yeah.

Martti Malmi 00:22:25 Yeah. Well, yeah, I, I think we need privacy in money and. Yeah, it’s not sufficient just to just have a public ledger for every transaction.

Vlad Costea 00:22:41 Do you like layer two proposals for bitcoin, or is there anything that caught your attention recently?

Martti Malmi 00:22:47 Well, I’m not too deep into Bitcoin these days, mostly with Nostre. Nostre. Use of Lightning… like Lightning is more or less integrated to all Nostr clients, including mine. so, you know, it’s good for finding people’s lightning addresses. And you can also zap posts a tip for posts on nostre that’s quite powerful. I think that’s something that Twitter might not be able to easily achieve because of KYC rules. So that’s pretty cool that lightning works. I just wonder if lightning providers like Wallet of Satoshi are gonna be canceled. I think they might be canceled in the future.

Vlad Costea 00:23:41 Well, they did shut down their operations in the US.

Vlad Costea 00:23:44 Yeah. And there was Phoenix, which is non-custodial, and they also shut down in the US. And that leaves us with important questions because, okay, we said it was bound to happen for custodial wallets because you can argue that they’re money transmitters. But then you had an LSP, which actually doesn’t hold the funds and only provides you the infrastructure for opening channels. Yeah. And that one also gets shut down. And it makes you wonder if you’re gonna run your own node. Are you under the same threat?

Martti Malmi 00:24:19 Yeah, it’s. I guess it’s more difficult shutting down individual nodes. And I guess you’re not a money transmitter. Or if you only serve yourself, it might be safer. if there’s many, many people running nodes.

Vlad Costea 00:24:42 I think that was the point in the evolution of the Lightning Network. I was part of this movement. It was called Rings of Fire, and the idea was to get these Raspberry Pi nodes routed over Tor and open channels with each other in circles. And basically everyone had at least one extra connection to which they could route transactions.

Vlad Costea 00:25:04 So we all agree to open channels in circles. And then someone had the channel with Bitrefill, someone had a channel with Blockstream or whatever, and we had a route to pretty much every major hub. But at one point I think the hardware was not powerful enough. And there’s also the reliability issue and the issue of forced closing of channels. And I think, at least in my case, I was not really earning any money from routing. I was maybe making 30 base units a month. So one Satoshi per day. So there was no sustainability, as some people promised in the beginning that you can basically monetize or pay for the electricity of your lightning node through this, and it’s not even the reason why I shut down. It’s just that I discovered that my payments were becoming less reliable, and it was easier for me to switch to an LSP like Phoenix, which charges you for the initial deposit. When you do the swap from main chain to lightning, maybe it has higher fees, but at the same time it just works every time.

Martti Malmi 00:26:11 Yeah, yeah, I must admit, I’ve never run a Lightning node myself. I use Wallet of Satoshi. It works really well for events like this where you buy beer with lightning.

Vlad Costea 00:26:25 Yeah, but people will argue it’s not really lightning. It’s just an account.

Martti Malmi 00:26:30 Yeah, that’s a good point. That’s a good point.

Vlad Costea 00:26:33 There is no way to verify that you actually use the lightning channel. And you’re not just transacting numbers from one server to the other. Yeah, exactly. It’s a bit scary. I do believe that the Wallet of Satoshi guys are nice and they don’t break the rules. They don’t create inflation. But there has to be a way to verify that.

Martti Malmi 00:26:56 Yeah. I wonder if we could have lots of these cashu, cash providers like local smaller communities, like one, one server admin geek serving, like the closest to 100 people or some something, or if that’s going to be outlawed as money transmitting as well.

Vlad Costea 00:27:22 I was going to ask you, did you buy alpaca socks or stuff like that in the early days or Casascius coins?

Martti Malmi 00:27:29 No.

Martti Malmi 00:27:29 Unfortunately not. They were selling alpaca socks like for like 15 bitcoin or what was the price? Something like that. And Casascius coins are valuable these days I hear.

Vlad Costea 00:27:43 Are they are nobody expected at the time for them to become this popular? There’s some trust involved there that, you know, Mike Caldwell, the guy who created them, might store on a notebook all the private keys that he ever issued. Like, you have to trust him, that he’s never going to rob his customers. But so far, he has an immaculate record. And I was going to ask you back in the day, what was the preferred way to hold your coins? You didn’t have so many choices. You just had Bitcoin.

Martti Malmi 00:28:16 Yeah, Bitcoin Core was the only choice for a long time. I don’t even remember if I guess it got some sort of wallet encryption. Maybe at some point. I don’t even recall. But that’s that’s what I used back then. Back in the day, Mt. Gox.

Vlad Costea 00:28:41 Mt. Gox.

Vlad Costea 00:28:42 Yeah. That was a very expensive lesson for bitcoiners.

Martti Malmi 00:28:46 Yeah, but on the other hand, they they lost 80% of their customer funds, but they had diamond hands for ten years. So it’s not a bad outcome for some creditors who might have sold their bitcoins if not for Mt. Gox.

Vlad Costea 00:29:03 That’s a fair point. Assuming that they’re going to get paid in fiat and that there’s going to be someone to actually make the payment, because I’m not sure how many of them actually got their money back.

Martti Malmi 00:29:17 they they say they’re going to pay back this year. Some of the Fiat is already paid back and they’re going to pay back. they are promising to pay back the bitcoins this year. I know, because I am a creditor.

Vlad Costea 00:29:32 Oh, so you have to receive some Bitcoin from them?

Martti Malmi 00:29:36 Yeah. Yeah. I guess it’s public knowledge. that they owe me ten bitcoins, which, get some of it back.

Vlad Costea 00:29:47 I was just thinking, can you buy the same apartment that you bought for many more bitcoins today? With the ten bitcoins you are going to get from Mt, Gox?

Martti Malmi 00:29:56 No, I’m not going to get ten bitcoins.

Martti Malmi 00:29:57 It’s going to be less, but I think I might. I’m not going to be selling them anytime soon. I mean, Bitcoin has existed for 15 years. And just think how far we might be in five or 10 or 15 years.

Vlad Costea 00:30:20 Where do you see the future of Bitcoin? Of course you have this ideological perspective that it must stop the money printer. It must end worse. But how do you think it’s going to function technologically? Do you think it’s going to be the same Bitcoin core and every one builds on top of it? Or do you think we might have some major changes in the way that it functions with new discoveries in cryptography and stuff.

Martti Malmi 00:30:43 Really? I think and I hope it’s going to be fairly resistant to change. I don’t have a crystal ball, and I, I don’t work closely with bitcoin these days, so I don’t really I might not have the most informed opinion, but I tend to be optimistic about Bitcoin. About Nostr. Those are the rays of light in the darkness.

Martti Malmi 00:31:16 even though there’s all this dystopian development going on with, with CBDCs, cities and scores and whatever, and recently these Bitcoin attacks on Bitcoin developers by governments.

Vlad Costea 00:31:35 You basically triggered me to start a rant right now because there is a project, Hamilton by MIT, and that’s a CBDC pilot that they’re trying to sell to the US government. And what MIT has been doing for longer than ten years now was to get Bitcoin core developers and give them money to fund them to continue the work. But if you look at the white paper of Project Hamilton, you’re going to see that they use the UTXO model from Bitcoin. They use Schnorr signatures just like they used in Bitcoin with Taproot. They use a lot of specifications from Bitcoin and they do reference them all the time. And they even use one of the developers Corey Fields. He’s a Bitcoin core developer. He also collaborated in the white paper and the technical implementation of projects. Hamilton. And it makes you wonder, you know, like all of these actors have been nice and benevolent.

Vlad Costea 00:32:31 Benevolent. But then they’re going to take the technology and turn it into something that Bitcoin is trying to oppose and was created to oppose.

Martti Malmi 00:32:41 Yeah. That’s interesting. And why don’t they just use tether? I guess tether is already. They don’t have full control over it, but it’s a bit like an extension of the United States dollar. And it’s interesting that tether is still running in some way.

Vlad Costea 00:33:01 Well, it’s not interesting and it’s not inspirational to look into the Treasury and see that tether is the company that buys 80 something percent of its holdings in US Treasury bonds.

Martti Malmi 00:33:13 Yeah, exactly.

Vlad Costea 00:33:14 So they’re an investor in the US government. Of course, they’re not going to get shut down because they hold huge amounts of it. If you ask the tether people, they’re going to say, oh, we’re just getting infiltrated. We’re like a Trojan horse. But if you look at the way it operates, it’s no different from a CBDC. They can seize funds, they can stop redemptions. It’s them who are in the middle of everything.

Vlad Costea 00:33:37 Peg ins and peg outs. I’ve actually they’re not cold like this. Issuances and redemptions. They issue tether to a client because they want to transfer money. There are some transfers in the middle and at the end, I guess some exchange does the redeem part. But in some countries, for example, my girlfriend is from Iran, and she told me this week that they the banned Tether in Iran was like, why did you not see this coming? And she was shocked, like, how can they do this? I thought it was technology like Bitcoin. It’s not.

Martti Malmi 00:34:11 Yeah, yeah. I wonder which direction that Trojan horse is going. This is like the US government infiltrating crypto or the other way around. I guess the optimistic case is that, like the current financial elites on the big capital are gonna get invested in Bitcoin and become stakeholders and be on our side, but I don’t really know.

Vlad Costea 00:34:41 Oh, yeah. Now we have ETFs. And whenever we look at the price, we have to check the news to see what’s happening on US markets and stuff like this.

Vlad Costea 00:34:49 It became too mainstream too fast. I guess most people didn’t have the time to process how fast all of this happened. And right now we just woke up with Blackrock and Michael Saylor and whatever, just telling us what Bitcoin should be and saying, oh, medium of exchange is a distraction. Yeah I mean what’s your I’m not trying to get into the whole fork with Bitcoin Cash because ideologically they’re very different. And they say Bitcoin should be used as a medium of exchange. But back in the day, did you perceive Bitcoin as a way to save or as a way to send money to other people?

Martti Malmi 00:35:27 Both in the early days, you didn’t like the transaction capacity was not really a problem. Usually there was zero fee when you were sending bitcoins, or maybe there was some like hard coded. Oh yeah. In one of my emails with Satoshi, I was wondering, I sent 10,000 bitcoins, but it ended up sending 10,000.2. What is the point two? And it was some hard coded transaction fee for large transactions.

Martti Malmi 00:35:54 But yeah, usually you could transact for free in the early days.

Vlad Costea 00:36:00 And that was if you read Andreas Antonopoulos book Mastering Bitcoin. He was speaking at the time in the foreword, I think in a later edition. No, but how would you put it? An older edition. He was talking about free transactions, and with Bitcoin you can move money for free all around the world. And of course it was a narrative at the time. It was not sustained by technical realities or economics within the network. But I guess where I’m standing right now and I want to ask you about Sidechains if you think that there’s anything interesting about them, because I’m also sponsored by Layer Two Labs, and they do have a proposal with Drivechains, and I think they’re great for the mission. I also have my concerns about what this means for miners, because there is a lot of talk about MeV and mining centralization and how they’re going to react when they have new incentives with fees coming from outside of the Bitcoin blocks. But what do you think about this concept of sidechains which are enforced by miners?

Martti Malmi 00:37:09 I’m not really familiar with, the whole topic to give really informed, opinion.

Martti Malmi 00:37:19 I guess we’re of course, gonna have to move stuff out of the layer 1 in one way or another.

Vlad Costea 00:37:28 I agree with this. And sometimes when people see that Bitcoin is fine and they should use I mean, I don’t want to shit on Fedimints because they do some cool stuff technologically. But it’s a bank. It’s a bank that they say anyone can open, but in reality it’s going to get centralized at one point and you’re gonna have humans.

Martti Malmi 00:37:46 Because if the governments are going to censor all the big actors, but not like the small community banks. I don’t know.

Vlad Costea 00:37:57 Well, my point is that I want people to be able to hold their own keys if they want. And if it becomes too expensive, there should at least be a sidechain where they can do this as opposed to telling them, oh, it’s too late for you to afford to use your own keys. Why don’t you go on this Fedimint, and you have to trust that the community bank is not going to steal your funds.

Martti Malmi 00:38:20 Yeah. Well, maybe you can trust your community bank. The people you meet in everyday life, at least for some small amounts, and have your savings in layer one or something.

Vlad Costea 00:38:35 You come from a high trust society, I think, and you look at your neighbors and you think that they’re nice. But if you look at the third world country and there’s a lot of talk about these places of the world, and there’s a lot of virtue signaling, and they say, oh, does the global South. I think that’s the way that it’s being defined. And they say, yeah, they’re gonna want to look up to these leaders who are part of the community and so on. But honestly, I think I don’t want to speak bad stuff about anyone in particular, but I do think that some of these community leaders are going to see themselves with a lot of money and they’re going to say, oh, I can finally go and live my life in Switzerland or something and never be seen again by their peers.

Vlad Costea 00:39:22 So it’s a major concern, and there is no way to mitigate this other than falling back on law enforcement. So basically using the state as the security for this money system, which, you know, it was not supposed to be like this, I remember I’m going to ask you about this also, but I remember I had an interaction with Luke Dashjr and ask him, what do you think about Liquid, which is not really a sidechain, it’s more like a federation, and he told me it’s much better than a side chain, because if someone steals from you, at least you have a few companies to sue to get your money back. And I was like, so is this really the security model that we have right now? You don’t it’s not cypherpunk, you know, you have to go to the states and ask for justice, as opposed to having cryptography and having computer networks and stuff like this.

Martti Malmi 00:40:13 Yeah, I guess it’s not perfect, but it’s better than having USD in the bank, I guess.

Martti Malmi 00:40:20 At least you can challenge the money printing monopoly.

Vlad Costea 00:40:27 Citrea brought the first ZK roll up to Bitcoin and is now building a Bitcoin backed economy that is EVM compatible with an extended suite of financial services that use the Bitcoin main chain to store only the basic smart contract data, While everything else from lending, borrowing services to privacy protocols will get built on layer two modules. Learn more about Citrea at Citrea.xyz and try their Bitcoin testnet applications today. NoOnes is the ultimate peer to peer exchange, serving more than 236 countries and aiming to empower the Global South. It also offers a great place to buy and sell gift cards, and there is also a NoOnes Visa card for spending your coins at millions of merchants worldwide. Once it trade your coins, there’s a spot Exchange feature two and the system is designed in a way that allows everyone to get a cut. As CEO Ray Youssef says on No Ones dot com everyone gets a seat at the table and everyone eats. So do you remember in the first year of Bitcoin, the order of the people who joined? Because there were quite a few developers.

Vlad Costea 00:42:03 There was Mike Hearn, if I’m not mistaken. We joined in that first year. I think Greg Maxwell was also around and a bunch of others. Do you remember how they came along and what were? I don’t know any memories about them.

Martti Malmi 00:42:18 No, I don’t really remember them from the forum days. I met Mike Hearn in Switzerland 2014, maybe Marcel, but I don’t really remember about the forum things like, until the Wikileaks thing. the forum was pretty quiet and you could read all the up new posts on the forum every time you signed in. But after that, not so much. Wikileaks kicked the hornet’s nest as Satoshi said, and the swarm is headed towards us.

Vlad Costea 00:42:57 Yeah, and that’s when he left, right?

Martti Malmi 00:43:02 I don’t recall the exact timeline. Could be.

Vlad Costea 00:43:08 Well, what’s your impression of Satoshi? Because in some statements that you made, someone can take them out of context and say, oh, this guy must be Satoshi. But did you perceive him as being this Japanese man or American or some nerds in his mom’s basement or someone old?

Martti Malmi 00:43:25 Yeah, I guess, the name and, on some profile.

Martti Malmi 00:43:30 He said he’s from Japan. First. I thought he’s from Japan. He’s a Japanese guy. But I had my doubts because his English was so good. actually, when Dorian Nakamoto was outed, so to say, I first thought, I guess this is how I thought Satoshi to look like. Like this. And I guess it’s a good picture of Satoshi in our minds.

Vlad Costea 00:44:01 A lot of people and memes, they use that image for Satoshi still, but for Dorian, it was a nightmare.

Martti Malmi 00:44:06 Yeah. Yeah. I’m sorry for him.

Vlad Costea 00:44:10 So your mental image was that of a Japanese man, but not really Japanese because he was too good at English. Yeah, it’s funny because I think I read something similar that Gavin Andresen said that he thought it was a young man from Japan.

Martti Malmi 00:44:26 I didn’t think he was young. Maybe I thought he was older than me, like in his 40s or something.

Vlad Costea 00:44:35 Interesting. Well, it’s really wild how you just googled something peer to peer cash or whatever, and you stumbled upon Bitcoin, which means that the page was pretty well indexed by search engines.

Martti Malmi 00:44:49 Yeah. And at that time when you googled for bitcoin, there was just like one page of results. It’s pretty interesting.

Vlad Costea 00:44:57 I do recall, I think the first blog post about bitcoin, or one of the first was written by Zooko, the creator of Zcash. Was he involved in any way?

Martti Malmi 00:45:07 I don’t think he was involved in the early days as far as I know. Maybe he was on the Bitcointalk forums at some point.

Vlad Costea 00:45:17 Did you meet anyone in person from the Bitcointalk forum except for my my current?

Martti Malmi 00:45:22 No, no not really. Bitcoin was only in the online world for me for a very long time. Then in maybe I, I might have attended some small meetups in Finland later, like 2013 or whenever Bitcoin hit $1,000. There was some meet up in Finland that I went to. other than that, that I went to. Bitcoin Amsterdam 2014. It was surreal how big bitcoin had become like it had been only only on the Bitcointalk forums and IRC or wherever for me before that.

Martti Malmi 00:46:01 And then there was everyone I met, the Kraken guys there and BitPay was there and many people were there.

Vlad Costea 00:46:12 So what was the last contribution that you made? When did you stop becoming not stop becoming stuck? Stop being a Bitcoin developer?

Martti Malmi 00:46:21 I might have, made some commits to the code base, maybe in 2010. I’m not quite sure. Could have been earlier. 2009 is when I made most of my contributions, I think. then I maintained the forums for a while on bitcoin.org. Then I needed a real job and I had less time to work on anything bitcoin related. later. I just didn’t it wasn’t, interesting to me in any way to continue managing the stuff. and it was getting like political people were sending me messages like, what what what I should and what I should not put on the bitcoin.org Patreon, whatever. I’m not interested in that at all. So that.

Vlad Costea 00:47:16 Sucks. Yeah. So who took on that Theymos or…

Martti Malmi 00:47:21 they most continued with Bitcointalk forums and and I gave on the bitcoin.org domain.

Vlad Costea 00:47:29 You used to own it.

Martti Malmi 00:47:31 Oh yeah. Yeah.

Vlad Costea 00:47:33 And now is it Cobra.

Martti Malmi 00:47:35 Yeah.

Vlad Costea 00:47:37 Well, how did you do that?

Martti Malmi 00:47:39 I cannot go into details about that.

Vlad Costea 00:47:42 What? But did. Was it just like a friendly share, or did you get paid or.

Martti Malmi 00:47:49 No, I did not get paid. I’m not going into details, but I did not sell the domain.

Vlad Costea 00:47:56 It’s funny, because you basically had the keys to one of the most valuable domains in the world.

Martti Malmi 00:48:02 I don’t know, I guess it’s valuable for scams or something if you were a scammer, but I think domain names are shitcoins. They can be taken away from you. They are centralized and hierarchical and basically they’re just someone’s website. And you should you should always verify your code, your binaries that you download and be mindful of your sources.

Vlad Costea 00:48:29 Speaking of domain names being shit coins, were you into Namecoin? Were you around when that emerged?

Martti Malmi 00:48:36 Yeah, I saw it. I think Namecoin might have been one of… It might have been the first altcoin around.

Martti Malmi 00:48:45 I never used it, but I it was on my radar.

Vlad Costea 00:48:50 And I just. That’s why it wasn’t successful. So many people were into Bitcoin but not into Namecoin. And it was merge mined with Bitcoin. So if it became successful, transaction fees could go to the bitcoin miners to increase their revenue.

Martti Malmi 00:49:05 Yeah. But I think naming should be done with web of trust or with social graph. Like maybe we don’t need globally unique names. We could have like just like a dropdown. Search us on social media. You want to see. You want to say Wasabi wallet page. You just type wasabi and it fills in from your social graph. like the verified by your friends account.

Vlad Costea 00:49:36 Yeah, you mentioned Wasabi, and I just remembered that the guys I’m going to interview after this and this is backstage. Details are from HODLing. They’re from Switzerland and they offer this service. They’re also sponsors. They offered this service to help you set up your own self-custody solution. Maybe there are people with a lot of Bitcoin or companies that that wants to start adding Bitcoin to their reserves, and they don’t know how to manage this.

Vlad Costea 00:50:03 Someone who owns a lot of bitcoin doesn’t want to hold it in their own house because it’s a threat, possibly, especially if they’re public about it and the company doesn’t want to have the keys in the hands of a CEO, or only one person who can just do stuff, spend them or whatever. So they’re going to consult you into doing your multi-sig. They’re going to tell you which hardware wallets you should be using. And they’re in Switzerland. So this means they have some privacy that companies from the US don’t have, and they don’t hold any of your keys. That’s very important because there’s a company called Casa in the US, and they promise that you never lose your Bitcoin because you give them one key. You keep one and another one can be acquired through two factor authentication or something. So they don’t have access directly to it. You have to request it I don’t know it. It’s just it’s good for some people. It’s just not why I got into Bitcoin. Did you stick around to see anyway HODLing.ch.

Vlad Costea 00:51:03 Check them out. Did you stick around to see the rise of hardware wallets? Because I think that was a major shift in how people manage their bitcoin.

Martti Malmi 00:51:12 Yeah, I guess I’ve always followed on the sidelines and I did my hardware wallet pretty soon after they were available.

Vlad Costea 00:51:22 Was it the Trezor or BTC chip?

Martti Malmi 00:51:27 I have various, hardware wallets. I don’t want to go into details.

Vlad Costea 00:51:33 You probably paid, like, ten Bitcoin for the Trezor. The metallic one you did.

Martti Malmi 00:51:40 No comments.

Vlad Costea 00:51:42 Yeah. Anyway, at the time, it was the only way you could sustain or support a Bitcoin company. And I, I spoke with Stick, the co-founder of Trezor, and he told me that the bitcoin that they got from the presale because they didn’t have all the devices to ship, they sold everything in 2013 to be able to pay for the deliveries and everything. So the price went up and they did not benefit from that price pump. But I’m happy that their business is still around. What did you think about mining pools when they started emerging?

Martti Malmi 00:52:18 Yeah.

Martti Malmi 00:52:20 I don’t know. I guess I was thinking if it’s going to be a centralization risk. but I don’t think it’s going to be such, It hasn’t been a centralization risk to much. many of my friends were mining on GPUs as early as 2010. Maybe when. That’s when the GPU miners came out. Many of my normie friends were mining.

Vlad Costea 00:52:52 Gamers, right?

Martti Malmi 00:52:53 Yeah. Yes.

Vlad Costea 00:52:57 Why do you think so? Early on, there was this convergence of hardcore gamers using their GPUs to mine. And nowadays, gamers hate Bitcoin and every other cryptocurrency because they perceive this as being the factor why graphics cards became more expensive. But at the same time, gamers are the people who are technically inclined and might like Bitcoin. They’re gonna intuitively understand how it works because they probably also use BitTorrent or something else. Why do you think gamers are not really into Bitcoin these days?

Martti Malmi 00:53:33 I guess a bit. Bitcoin is a libertarian thing. of course everyone’s into bitcoin if they can, if they can mine it like back in the day on their GPUs.

Martti Malmi 00:53:49 Bitcoin doesn’t automatically convert people into libertarians as I’ve noticed. Many of my bitcoin miner friends are still social Democrat.

Vlad Costea 00:54:01 So if they mine, they agree to pay taxes on it to the state and think it’s helping society somehow. Yeah, really?

Martti Malmi 00:54:09 Yeah they do.

Vlad Costea 00:54:11 That’s insane. I mean, they’re pretty OG. I guess they got in early.

Martti Malmi 00:54:16 Yeah. Back when you could solo mine on a GPU. Weirdly, I even solo mined one block on a gap year at some point pretty late when it was still possible.

Vlad Costea 00:54:31 But it’s Finland, I guess. And I did six months of exchange in Sweden, and all they did for half, more than half the time it was just shoving down our throats the idea of the welfare state. They were saying we’re better than the Germans, were better than everyone else, were giving everything to everyone. And they took us to this immigrant neighborhood. And they had these people from Syria, if I’m not mistaken, and they were housing them, and they were sending them food and they were taking their kids to school, and they were giving them everything out of the taxpayers money, basically.

Vlad Costea 00:55:05 Yeah. And the social workers there were still concerned that these people are being marginalized and they’re not part of the center. They’re not part of the Swedish culture. Yeah. And I was thinking, how the hell do I sign up for this? Because I was paying €600 for my rent and it was much shittier than what these people had, you know. I was thinking, you know, I don’t think this scales, and obviously it did not.

Martti Malmi 00:55:29 Yeah. Scandinavian countries have been successful despite socialism. Well, if you take a look at the Economic Freedom Index, we are actually pretty high on the economic freedom despite the high taxation on whatever. And maybe I guess, like you say, the high trust society. That also helps maybe.

Vlad Costea 00:55:55 I come from Romania and we have more of a distrust in government, just like people from here and Czech Republic. Yeah, they were invaded by the USSR Army in 1968. Yeah. They brought tanks into this place.

Martti Malmi 00:56:10 Yeah. I guess in Finland and maybe other Scandinavia.

Martti Malmi 00:56:15 The corruption is on a higher level. It’s like legal corruption, legal ways of corruption.

Vlad Costea 00:56:22 Yeah. It’s different. The average person doesn’t have access to corruption, but at the high level, you don’t really hear about it much because they also control the media. That’s another aspect of Scandinavian countries that I don’t get. Most of the press, like 90 something percent is subsidized by the government, and they see that they keep the money so they don’t get paid by, you know, evil advertisers from the private sector. But this also means that they’re not going to report anything against against the powers that be. Yeah. So it’s hard to be, for example, libertarian news or whatever. Where do you get that in Finland? Do you have any TV channel that’s libertarian.

Martti Malmi 00:57:04 Social media, I guess. There’s one libertarian think tank in Finland, but that’s about it. And even that has been watered down in the recent years.

Vlad Costea 00:57:17 But there’s the Pirate Party that came out of Sweden.

Martti Malmi 00:57:21 Yeah, there was this whole pirate movement, which was inspiring even to me as a 20 year old computer science student.

Martti Malmi 00:57:29 Pirate Bay actually, I even like, modeled the the UI of Bitcoin exchange dotcom after pirate Bay. It was just like a similar, very similar look and feel.

Vlad Costea 00:57:41 That’s an interesting detail. And I think also the Pirate Party in Sweden was among the first organizations to use Bitcoin because it’s open source software. They were already into a bunch or something.

Martti Malmi 00:57:55 Yeah.

Vlad Costea 00:57:57 I went to one of their meetings when I was in Sweden, and they gave me a CD with ubuntu, and they said, give up on that windows crap, is this. I didn’t because I was an idiot. But yeah, they were very advanced from this point of view, very visionary. I hope that some people actually made some money and they can make a change now.

Martti Malmi 00:58:19 Yeah, yeah, I hope so.

Vlad Costea 00:58:21 Are you still optimistic about Bitcoin, or is it easy to get desolated by the events where ETFs and banks.

Martti Malmi 00:58:28 And I’m optimistic. I don’t know. I don’t know if I’m being realistic, but maybe it’s like a natural disposition to be optimistic.

Martti Malmi 00:58:38 What what else can we do. What’s the other alternative.

Vlad Costea 00:58:43 Well, I guess we can also be pessimistic to the point where we push people to create solutions. Yeah, because right now I think the adjective that people use is bullish and they say everything is bullish for Bitcoin. Yeah. The government captures it. It’s fine. It means they accept it as money. So we’re kind of get rich.

Martti Malmi 00:59:02 I am a little bit concerned about of course like maybe the ETF can be our Trojan horse into the financial elite. but maybe I can also see a future where all Bitcoin is KYC or outlawed and all that, or something that we might not even imagine.

Vlad Costea 00:59:26 Is there anything that you would change about Bitcoin if you could? Like if you had magic powers and you could change one parameter?

Martti Malmi 00:59:33 no. Like one wouldn’t change anything. No, no.

Vlad Costea 00:59:36 Didn’t you find it awkward that there are 21 million of them of coins?

Martti Malmi 00:59:42 No.

Vlad Costea 00:59:43 Or that there are eight zeros?

Martti Malmi 00:59:45 You just have to pick some number.

Martti Malmi 00:59:47 And Satoshi had his reasons.

Vlad Costea 00:59:51 Do you know why it’s 21?

Martti Malmi 00:59:55 I cannot give a lecture on it, but I think Satoshi explained it in some of those emails or forum posts.

Vlad Costea 01:00:04 Is it public?

Martti Malmi 01:00:06 Yeah.

Vlad Costea 01:00:07 Can you make a quick summary?

Martti Malmi 01:00:09 No, no I can’t. I’ve had two beers already.

Vlad Costea 01:00:12 Okay. I don’t know if someone discovers the forums and wants to get into the first year of Bitcoin. What do you think is a good place to start? What? What do you think is the highlight of this era?

Martti Malmi 01:00:31 what do you mean?

Vlad Costea 01:00:33 Obviously, it’s hard to go through everything, even though there isn’t that much. But what do you think is spicy or interesting or exciting to discover from that time? Well.

Martti Malmi 01:00:45 In the very early days, everyone was idealistic. That’s what why they were on the forums. It wasn’t about making money. That changed. Maybe sometime in 2010 when my normie miner friends started flowing in. there’s nothing wrong with that. It just means Bitcoin’s incentives are right to on board, not just the libertarians.

Martti Malmi 01:01:13 I found the forums nicer in some way, or more comfy or cozy in the early days, maybe because of the idealism. And just that it was a smaller community and nicer. But. But it was inevitable.

Vlad Costea 01:01:34 Do you still post on Bitcointalk?

Martti Malmi 01:01:36 No, I haven’t posted in a very long time.

Vlad Costea 01:01:40 Would you make a bridge from Noster to Bitcointalk or Bitcointalk to Nostr?

Martti Malmi 01:01:44 Haha. I don’t think it’s up to me. Well, I could make a bridge from Bitcointalk to Noster, I guess. Could be interesting.

Vlad Costea 01:01:55 It could be very interesting. Or even a bot to take some old posts and remind people what ideas were being spread around during the early days, because I guess you have a recollection of these events and someone who is new to Bitcoin doesn’t even know what to search for. They’re going to search for some sources, but they’re not going to go all the way back to see where this all started. So I think this whole movement of Bitcoin history can be very useful and at least reminding people where they started and what kind of people were involved in this, what kind of ideas they had and why it became big in the first place.

Martti Malmi 01:02:33 Yeah, it could be interesting if you could, like, make a snapshot of any point in time on the forums. And oh, would be such a nostalgic blast from the past. Say like 29 like 2009 version of.

Vlad Costea 01:02:49 I mean, for you? It’s nostalgic, but for some people it’s something entirely new that they had no idea existed.

Martti Malmi 01:02:54 Yeah, I guess it’s a bit like my emails with Satoshi. They have all always been in my mind in some way, but it was interesting to see people’s outtakes and reactions Like, to me it was always clear that Satoshi is not the CIA. When I saw him configuring WordPress with me. or maybe it was CIA playing 4D chess or something. But yeah, when you read the emails, I guess you get the. Have you read the emails? I did.

Vlad Costea 01:03:31 But my follow up question is, have you published everything or is there still something that you are keeping correlator or for destroying?

Martti Malmi 01:03:39 No, I published everything I have, but so I said in the archive, my email address changed, sometime in early 2011, and I don’t have backups of the new address.

Martti Malmi 01:03:57 So, you know, I don’t have my last emails with Satoshi.

Vlad Costea 01:04:00 Okay. In a way, it’s convenient because basically, when he left, Maybe he told you something. You don’t have it anymore. It’s lost. But it’s probably for the better.

Martti Malmi 01:04:11 Could it be?

Vlad Costea 01:04:14 Thank you very much, Marty. It’s been an honor and a pleasure. How can people keep up with your work these days? You still work on your Nostr client, Iris.

Martti Malmi 01:04:24 Yeah. You can go to Iris dot to slash Sirius iris.to/sirius. Or follow me on Twitter.

Vlad Costea 01:04:37 You still want people to follow you on Twitter even though you’re using Nostr?

Martti Malmi 01:04:43 You know, don’t follow me on Twitter.

Vlad Costea 01:04:48 Thank you very much. And it’s been an honor.

Speaker 4 01:04:50 Thank you.

Vlad Costea 01:04:55 Oh, is there anything else that you do some business you want to promote?

Speaker 5 01:05:01 No, not at the moment.

Vlad Costea 01:05:02 Okay, forgot to ask.