Dialogue with Casey, the father of Ordinals: Only use a small position for "gambling", and use the rest to buy Bitcoin

Interviews: DUDU (PukeCastCN), Jasmine (Runes Chinese Community)

Compiled by: Jaleel, BlockBeats

Editor's note: As a programmer and Bitcoin developer, Casey Rodarmor (@rodarmor) created the Ordinals protocol and the Runes protocol in two years. By developing the Ordinals protocol, Casey provided a new way to store and transmit non-monetary data (such as digital artworks) directly on the Bitcoin blockchain. It can be said that without Casey, there would be no Bitcoin ecosystem.

Casey shared his experience at the Ordinals Asia conference in Hong Kong

Before Runes went online, Casey joked that if "the market value of Runes ecosystem did not reach 1 billion US dollars within one month of its launch, he would commit suicide." Although the goal was achieved briefly in the middle, the market value did not reach the target after one month. How did Casey respond to this joke? The Bitcoin Ecosystem Conference two weeks ago was very lively in Hong Kong. How did Casey feel about Hong Kong? Jasmine, one of the founders of the Runes Chinese community, and DUDU of PukeCastCN chatted with Casey in a Space yesterday.

BlockBeats has compiled the interview content as follows, with some content deleted.

DUDU: Bitcoin Week in Hong Kong two weeks ago was very lively. How do you feel about it? I heard that many people got sick because they played too much.

Casey: Yeah, I took a week and a half to recover, but I'm doing much better now. The Bitcoin market in Hong Kong is crazy. There's a big difference between Western and Eastern players. Chinese people really like gambling and have a huge passion for runes and shitcoins. I think this is much better than a lot of Western shitcoin fans who always pretend to pursue the future of finance and even talk about banking Africa. The market here is purer and more honest, and everyone is talking about how to make a lot of money.

DUDU: Rune Protocol has been launched for a month. How do you feel about the first month? Are there any special surprises or things you want to mention?

Casey: No surprises, that's fortunately. My main concern was bugs in the protocol. If there were protocol-level bugs that messed up the balance of Rune, or affected minting or transfers, that would be bad. But so far, so good, no protocol-level bugs. There was a small bug in ord (a reference implementation of Rune), which was unfortunate, but not a big deal, and I'm glad that bug was fixed in a timely manner.

I think it was predictable that when Runes first launched, there would be a lot of disappointment because it was so hyped and everyone was saying, "These things are going to take off, to the moon," and that was not the case. When a technology first launches, it's in its worst state. The ecosystem support is the worst, the tools are not complete, the trading platform is not complete. I think it's natural to have some disappointment.

I don't know what the price and popularity of Runes will be like, I don't make predictions. The only investment I've made money with is Bitcoin, and as an investor I have very limited wisdom. I really don't know what will happen. The pleasant thing is that those who have integrated Runes told me that it will be much easier than integrating BRC-20, which makes sense. The protocol is simpler, especially when you do everything with BRC-20, make an inscription and then maybe transfer it. It takes three transactions to transfer a BRC-20, which is quite a lot. Transferring Runes only takes one transaction.

I think the technical advantages of Rune in terms of simplicity and efficiency have already been shown. It has always been simple and efficient, and those who have integrated Rune say so, which is great. I don't know what the future of Rune will be like, it's hard to say. On Ethereum, there are decentralized exchanges where people can do all kinds of transactions on the chain, such as trading Rune or BRC-20. Bitcoin doesn't have these. Solana has zero-second transaction times, Bitcoin doesn't. I think it remains to be seen what market Rune will occupy in the future. As far as I am concerned, the first month has been great and everything has gone according to plan.

Image source: Ordinals summit 2023

Jasmine: You have always emphasized that Runes was created for Memecoin. It is not about technology, but more for social interaction, gambling and entertainment, so that more people from other ecosystems can pay attention to the Bitcoin ecosystem and eventually use Bitcoin. Runes has indeed attracted a lot of attention and participation from people from other ecosystems. As of now, there are more than 70,000 Rune tokens, basically all Memecoin. So, where do you think the next breakthrough of the Runes ecosystem may happen? What should builders pay more attention to? For example, building some applications that make StarWorld Casino more interesting? Or something else?

Casey: Regarding future protocol development, there's not really a lot planned. There are a few little things. For example, there's a possibility of allowing people to create runes, and the creator of the rune is the only one who can mint it. That's part of the protocol in the future. Protocol development is very tricky. Especially, for example, people want something like decentralized exchanges (dexes), like Uniswap for runes on Bitcoin.

The problem, however, is that if you don't design the protocol well, you can introduce something called MEV (miner extractable value). With something like Uniswap, miners or validators on Ethereum can insert their own transactions and reorder transactions to make money off of user transactions. For example, if you send a buy transaction, a miner can buy it before you, thereby guaranteeing that you are buying from a miner. Not only is this a problem of miners making money at the expense of users, it also leads to miner centralization because miners have to invest in this very complex infrastructure to be competitive. This means that miners can no longer simply plug in their hardware and start mining, they have to do a lot of other work, which centralizes miners. And the core value proposition of Bitcoin is decentralization. I want to improve the protocol, but no matter what, I will not add anything that leads to the centralization of Bitcoin miners, which is very tricky.

My advice to people building on Runes is that you have to make things fun. If you don’t have a decentralized exchange like Ethereum, or instant transaction confirmations like Solana, you can only focus on making things fun, which is a tall order. It’s hard. You have to make your interface fun. You have to make your community fun. You have to make any mechanism you introduce fun.

But I think what people should really focus on is fun, think about how to build the best casino possible. Rune is built for meme coins and shitcoins, but it's a good protocol. There's nothing at the protocol level stopping people from doing "serious things" with it. I'm very skeptical about what serious things can be done, a lot of protocols are just scams, they don't do what they say, so don't do that. But if there's enough interest, for example, there's a stablecoin on Rune that's backed 1:1 by USD or something, I wouldn't be surprised, let's all pray for the development of L2.

99% of Layer 2 protocols are garbage?

DUDU: Do you think the second layer of Bitcoin is promising? Why?

Casey: I don't know if I would say I'm bullish on layer 2. The problem is, as far as I know, nobody has built a layer 2 that actually works. A lot of people have ideas. Even if they have a fancy white paper, you have to look at it with skepticism. There have been thousands of white papers published in the last 10 years, and 99.999% of them are garbage, complete garbage. You have to wait until someone builds something that works, and then you can see the properties of the system when it exists.

For example, if you look at the Lightning Network, the Lightning Network is great. I love the Lightning Network, but it has some real drawbacks and operational hassles. It's hard to keep channels open, and there are all sorts of sophisticated attacks to worry about. We haven't seen the proliferation of mobile wallets for the Lightning Network that can pair with anybody and open channels with anybody. Right now, the Lightning Network wallets that work on mobile are channels opened with specific Lightning service providers. If you just read the Lightning Network whitepaper, it would be hard to predict all of these different difficulties.

My attitude towards layer 2 is “seeing is believing”. So I am more on the sidelines than bullish. I personally rely on L2 developers. When people create L2 on Bitcoin, they can add whatever they want on L2, and if they are careful, they don’t cause MEV or centralization on the base layer. This is what I expect, and I am counting on the development of L2. If L2 has this transaction or other features, people can transfer runes to L2, do anything on L2, and then settle it back to the main chain, which is a future feature I hope for.

Jasmine: You mentioned in a tweet that you would rather invest in some centralized service projects than some Layer 2. I would like to ask you about your views on decentralization. Is decentralization really that important in all these ecosystems?

Casey: First of all, to be clear, decentralization is best, followed by centralized services that deliver on their promises. If you can't be decentralized, then centralized services are acceptable if they work. In the market competition, good services will survive and bad services will be eliminated. Even in the competition among centralized services, this is true. The worst case is the services that claim to be decentralized but are actually either centralized or simply don't work. My comments are actually directed at those who invest in decentralized projects that don't work at all or are just an excuse to issue tokens and then sell them to people. So I prefer to invest in decentralized projects that actually work, but a lot of the investment I see today goes to decentralized projects that have no chance of success.

If people have to choose between a decentralized project that is doomed to fail and a centralized service that provides a useful service, I would rather people invest in a centralized service that actually delivers on its promise. For example, in the US, the best centralized service to buy Bitcoin is probably River. It's a very simple Bitcoin financial service platform where you can buy Bitcoin, transfer money, and so on. I think it would be great if every country had one or two companies like River that provide people with a safe and easy way to get Bitcoin. I would rather see that than a bunch of L2s that will never work. So this is not about centralization vs. decentralization, it's about centralization vs. fake decentralization. In this case, I will always choose the functional centralized alternative. I would like to see some very good centralized exchanges that focus only on Bitcoin or Runes, listing every Rune. I think that would be very interesting and fill a gap in the ecosystem.

DUDU: BRC-20 has added new features for new tokens. For example, new tokens can be added or subtracted. But there is no such feature in Rune. In Bitcoin, stablecoin is a very important feature. For example, there is such a feature in Ethereum or Solana. But Rune does not have such a feature. What do you think of stablecoins in Rune? Do you know any projects about Rune stablecoins?

Casey: Of course, I would divide stablecoins into three types.

First of all, I don't agree with stablecoins that try to be backed by project utility tokens. This is a bad idea. These schemes always break down. Terra's luna is one of these algorithmic stablecoins. I think I have seen a similar project called DUCAT, which I don't agree with. I read their white paper and it is very complicated. I don't believe that what they are doing will work at all. We will wait and see.

Another type of stablecoin is to create a synthetic coin. Essentially, for example - I'll cover the simplest stablecoin. The simplest stablecoin is you buy dollars. For example, or you get dollars. You have this token and people can buy tokens from you for $1 per token, or they can redeem it for $1 per token. If you give them a token, you're sending a dollar to their bank account. This is the simplest and most secure stablecoin. Tether and USDC are such stablecoins. I haven't heard of anyone trying to build a stablecoin like this on Rune. These types of projects are usually very complicated. You have to have banking relationships, etc.

And then there's another type of stablecoin where you're trying to create a synthetic stablecoin by trading two sides. You have people deposit bitcoin into your bank account, and then you go long bitcoin so the price of bitcoin goes up. You sell a put or a call option on bitcoin. If the price of bitcoin goes up, you make money. And then you're also short bitcoin, so if the price of bitcoin goes down, you make money as well. It's kind of like a delta neutral hedge. Whether the price goes up or down, your value remains the same dollar amount.

I've heard of a couple of projects trying to build stablecoins based on this model. It's not as crazy as a fully synthetic stablecoin, which is trying to create value from nothing. I think neither of those are in a state of practical viability yet, and they haven't made this public yet, except that they're privately saying, "Oh hey, we're working on this."

DUDU: You have mentioned OP-CAT several times. Can you elaborate on why you are optimistic about OP-CAT?

Casey: I like OP_CAT. OP_CAT seems like a very powerful opcode that adds a lot of missing functionality to Bitcoin. In general, I'm open to opcodes as long as they're reasonable and not crazy. I'd personally like to see OP_CAT. I'd also like to see OP_CTV, which is a contract opcode. Even crazier things like great script recovery would be cool too.

I'm not a researcher, I don't have in-depth insights. This is just my off-the-cuff opinion. I think it's too early to say what will ultimately happen. I like OP_CAT, but some people are talking about OP_CAT as if it's inevitable. Someone on Twitter, unnamed, said, "OP_CAT is going to happen whether you like it or not." I think the reality is that it's actually very uncertain until people actually try to activate something, and they haven't done that yet.

BlockBeats Note: OP_CAT is an opcode that may be implemented, which can help Bitcoin realize the function of smart contracts. For more information, see: "13 lines of code to help Bitcoin realize smart contracts? Read OP_CAT soft fork"

Have fun, buy Bitcoin

DUDU: Can you share with us more about Fun Collection? Seeing that you post frequently on your social media, do you have any further plans and when will it be released?

Casey: Fun is a collection of photos taken by my friend Parker Day, who we've been working on together. She started working on this project two years ago. At the time she was shooting and doing all the actual work, I was working on the ordinals and what became the inscriptions. We didn't know exactly how we were going to sell them, but it turned out that in the time it took to finish them, the ordinals and the inscriptions became popular enough that it actually made sense to put them on Bitcoin as inscriptions. So, it's a collection of 1,000 photos taken on film. No Photoshop, just makeup and hair, no special effects.

Fun Collection

I actually just finished inscribing all of them today, and it took a long time. I had to write a program to wait for low fees to do the inscriptions. So, I finally got all 1,000 inscribed. That's a lot. I think, the total size is 100 megabytes. So, that's 25 full blocks of inscriptions. Yeah, there's no specific plan to release it at this point. We're going to sell them somehow, but I'm not sure how yet. I'm very happy with the collection, though. I think it's probably the most expensive collection, because it's all shot on film, with models and makeup and hairstylists. Probably the most expensive collection to inscribe, too. 97 megabytes of data is no joke. So, it's a nice collection. I don't know if I would recommend someone to buy it. I don't give investment advice, but the art is very good. So, I'm very happy that it's on chain.

While this kind of art isn’t everyone’s cup of tea, it’s Parker’s style, and she launched a series of portraits called “Icons” in 2017, which was her breakthrough work in a similar style. I think it’s a great fit for NFTs because profile picture sets (PFPs) are popular. I think it’s closest to what a PFP would look like. What something like Board Ape Yacht Club or Crypto Punks would look like in real life. They’re colorful and very weird. I think if it wasn’t weird, it would be a little boring. I don’t want to do another collection of 10,000 images made up of numbers. If it’s not weird, it’s not worth doing. It’s not very interesting. I would encourage people to start looking through these images. There are some weird details. Some may not be to their taste. There are some sexy girls in there. People who are not that weird. There are also a few pictures of cats. Take a closer look and see if there’s anything you like.

Jasmine: You joked before that if Rune Protocol doesn’t reach a market cap of $1 billion within a month of its launch, you would like to say something about that joke? Or do you want to set another goal today?

Casey: Absolutely not, I will never make a price prediction again. Given the last goal, we didn't achieve it. I remember on May 20th, our market cap was $999 million. It did exceed $1 billion a month before that. But the rule is what the price is a month later. A month later, the total market cap of Runes was not $1 billion, so you are talking to Casey's "ghost" now.

Runes market value data, source: GeniiData

DUDU: Finally, please share any thoughts you have on the Bitcoin ecosystem.

Casey: It's great to be with you all and meet a bunch of dgens in Hong Kong. As for the last thing I want to say, it's all about buying Bitcoin. Runes and Ordinals are an interesting form of speculation, but nothing really compares to Bitcoin. It's the hardest currency we've ever had.

If you look at the history of fiat currencies, the lifespan of fiat currencies is 100 years at most. They all die, get devalued, and fall apart. We can see that even with the seemingly strong dollar, inflation is happening faster and faster. So I would say buy Bitcoin and only use a small portion of your savings to play with Runes and Ordinals. But whatever else you want to do, be sure not to buy coins mined by venture capitalists, there is no reason to buy pre-mined coins. It costs nothing to make coins, especially runes, and you can issue a coin with a click of the mouse.

I don't condone VC-mined coins, use a small portion of your capital to play around with gambling. But the rest, buy Bitcoin. Like I said, it's the only investment I've ever made money on. I'm still very confident in it. We have about 10 times the growth before Bitcoin reaches the market value of gold. I think it will probably happen. Bitcoin is much better than gold, and you can teleport it to the other side of the world in 10 minutes.

So that's all I want to say in the end, have fun and buy Bitcoin.

Original link