Bitcoiners Must Remove Single Points of Failure | Dhruv Bansal SLP771

Stephan Livera (0:00)

Hi, everyone, welcome back to Stephan Livera Podcast. Rejoining me on the show today is Dhruv Bansal from Unchained. He is a co-founder and CSO. Many of you will already know Unchained as a provider of Bitcoin financial services, but done using Bitcoin native keys and Bitcoin native approach, where maybe you might hold two keys and they hold one, and they can help you provide a vault or do a loan, this kind of thing. So, certainly an interesting time right now, as I'm sure everyone, anyone who's watching this show, is probably familiar with the myriad attacks that the Bitcoin ecosystem and industry has undergone recently. I mean, so let's see, the cold card thing, Boltz.exchange, BTC Pay, Core Lightning, and the liquid thing just recently, like all just in the last month and a bit.

And so obviously, you guys over at Unchained have been obviously a big promoter of the idea of Multisig. That's been a big core part of your business model.

So I guess let's just start there with the cold card theme because obviously that was, you know, as I recall, like 27th, 28th of July, around that basically end of July is when we kind of knew about this cold card thing.

Dhruv Bansal (1:24)

Two years ago at this point in my life. But I think it was actually about a month, a month and a half ago, exactly.

Stephan Livera (1:30)

Yeah. So talk to us from an Unchained perspective.

You know, what was the, I guess, let's start with the high level. Like, was there a lesson that we can take from this?

Dhruv Bansal (1:43)

I think there are so many. There are so many. And I think many people have been thinking about the impacts on themselves, Bitcoin, technology, et cetera. I think there's a ton.

If I could just spit them off the top of my head, I can get into each one. I think number one is no single points of failure. And self custody does not equal not having single points of failure automatically. You have to arrange for that to be true. I feel like that's the number one thing. And number two thing is, yeah, new things are scary right now, right? The newer that something is, the less battle hardened and tested it has been for decades, and so on and so on, the scarier it kind of becomes.

We've seen that a lot. A lot of the things that you mentioned are second layer, relatively new things that have been added to Bitcoin. It's not Bitcoin itself that's being added, right? It's these additions to it, it's these things that are adjacent to it. So that's where you have to get super careful. And then I'll say third is just like, all computers are going to be headed in this direction soon, right? Like, it's not just Bitcoin or Bitcoiners that are struggling at that right now. It's going to be everybody. And that is terrifying.

Stephan Livera (2:53)

Yeah, there's a lot to pick apart inside of that. I think a lot of people.

So, here's the thing, probably a lot of people who are serious about Bitcoin, they've heard of Multisig, but they haven't actually gone and taken that step to use it. Right? Now, it's probably, I've just kind of thrown out these numbers and I'm, you know, interested, any listeners or yourself, push back on me if I'm getting these numbers wrong.

Add a guess, ballpark, maybe 10 to 12 million hardware wallets have been sold like, you know, all time. Once you add like Trezor, Ledger and all the others, Bitbox, Jade, CodeGuard, whatever else, out of that, there's probably like four or five unique hardware wallet users. And then out of that, again, it's probably only like, add a guess, 50,000 or 100,000, something in that range who actually use Multisig for their code storage, you know? Like so we can, we can shout about Multisig until the cows come home. But if it's like 1% or 2% of the hardware wallet users, like, is there a difficulty around ease of use? Is it a knowledge thing? Is it just laziness? Is it just like, why has Multisig kind of struggled?

Dhruv Bansal (4:04)

Yeah, I think it's a mix of all those. Plus, truthfully, it's maybe not necessary for everybody when their stack is really small, you know what I mean? Like, you know, one man is small and another man is big. But like, I think those numbers that you said kind of line up with my own intuition, what I suspect. But it's important in that, you know, group of five million that cut to one million, that cut to whatever, to recognize, okay, what of those people who has like more than a tenth of Bitcoin, more than one Bitcoin, more than 10 Bitcoins, right? Like those cuts also matter. It's kind of a multi-dimensional thing.