Rabbit Hole Recap: Bitcoin Week of 2021.08.09
8/13/2021 · 130 min · transcript via mlx
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Key topics
— Infrastructure bill passed without voting on amendments; Treasury Department (Janet Yellen) wrote cryptocurrency provisions, raising questions about unelected agencies writing law; provision goes live in 2023.
— Representative Beyer's proposed bill targets privacy coins, stable coins, and anonymity services; gives Treasury power to define terms like "money mules" and "anonymity enhanced virtual currencies."
— Malicious node graphing attack detected in July 2021; unknown party flooded Bitcoin network with fake IP addresses to map peer topology; use Tor or I2P to protect node privacy.
— Compass Mining granted $80,000 to Bitcoin Core developer Jon Atack via Human Rights Foundation for review and coordination work.
— BitMEX settled with CFTC and FinCEN for $100 million; now a fully regulated derivatives exchange compliant with U.S. KYC/AML policies.
— Lightning Network capacity exceeded $100 million; Lightning Address standard (using LNURL) enables human-readable payment strings; Bolt 12 planned as native Lightning invoice replacement.
Market & price signals
— Bitcoin trading at $44,470; broke out of $30K–$40K consolidation range earlier in the week, touching $46K. Market cap $835.3 billion. At 89.45% of all Bitcoin ever distributed. Hash rate recovering; difficulty adjustment expected early August 13th with 7.4% upward adjustment. Block height 695,460 (all-time high). Gold fell ~5% this week; Bitcoin-to-gold market cap ratio at 7.29%. Mempool clearing (2,299 transactions at time of recording); one sat/byte transactions now viable.
Actionable insights
— Run your own Bitcoin node using Tor or I2P to defend against network surveillance and graphing attacks; consider Raspi Blitz or other node-in-box implementations that default to Tor.
— Use coin control when consolidating UTXOs into passphrase-protected wallets; send individual UTXOs separately over time and stagger timing to avoid cluster analysis; tools like Electrum, Wasabi, Spectre, or Sparrow (with own node) enable this.
— Adopt Lightning Address or plan for Bolt 12 adoption for receiving payments; Lightning Address improves UX over LNURL but requires a web server (use bridge server or Tor bridge if privacy is critical); Bolt 12 offers native, server-free static invoices once deployed.
Episode sponsorships
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