Bear Arms N’ Bitcoin 2021: Q&A with speaker Econoalchemist and auction update
Only seven weeks until Bear Arms N’ Bitcoin 2021! Last week we announced a new speaker for the conference, Econoalchemist. He writes Bitcoin related guides and tutorials with a focus on self-custody, censorship resistance, and privacy. His guide, Home mining for non-KYC Bitcoin is especially impressive, so we invited Econoalchemist to present it at Bear Arms N’ Bitcoin 2021.
To give you a preview of the man behind the words, we present the following Q&A.
GnB: Why should people mine bitcoin at home, rather than buy bitcoin on an exchange?
Econoalchemist: KYC, permission, and censorship. Mining at home solves all three of these problems AND in the right conditions, bitcoin acquired through mining at home can be significantly cheaper than market price.
KYC – Every exchange, broker, or on-ramp engaged in “regulated activity” will comply with KYC regulations. This means that users will often go as far as sharing a picture of themselves holding their license in front of their residence with these companies. Some requirements are even stranger but all of the requirements involve exposing personally identifiable information about a user that would prove beyond a reasonable doubt their ownership of bitcoin. In the wrong hands, by way of data breach for example, this kind of information tied to a person’s bitcoin holdings can put their lives at risk. In the hands of a government, this kind of information can put a person’s freedom at risk. Any company that collects KYC information, actively works with law enforcement upon request. If a government decides to enforce a 6102-style order or worse, then these KYC-collecting companies are not going to stand at the users’ defense. The onus is on each user to defensively guard their privacy for their own protection and freedom, and that starts by not providing KYC information to anyone and reclaiming that ground. When a person mines Bitcoin at home, they don’t have to share any KYC information with anyone.
Permission – So long as a person depends on an exchange, broker, or on-ramp for their bitcoin; then that person is subject to the company’s rules. If the company decides a user doesn’t qualify for an account, then they have given up all their KYC information only to walk away empty handed. If the company so graciously grants a user permission to buy bitcoin, then the company may decide to limit or cease withdrawals abruptly while the bitcoin is still under the company’s control. In recent months, we have started hearing rumors of users being required to verify ownership of their receiving address when taking bitcoin off an exchange. The next logical step is that the exchange will start requiring the users’ xpubs, and if a new user hasn’t properly segregated their KYC and non-KYC funds then they could potentially expose themselves to even more risk. When a person mines Bitcoin at home, they don’t have to seek permission from anyone.
Censorship – If a user has been rejected by a Bitcoin exchange, broker, or on-ramp, then they have experienced censorship. Mitigating bottle-necks and keeping things as decentralized as possible is crucial. No one can censor a user from mining Bitcoin at home, but if the pool deposits the coinbase reward into their own wallet before distributing portions to mining operators then we have a bottle-neck and potential point for censorship to pollute the Bitcoin ecosystem. This is closely tied to permission but it goes further.
Whitelisted mining pools are beginning to materialize and although these pools will operate at a loss initially, they will probably be subsidized by government contractors using federally awarded funding to remain in operation long enough to start causing problems. The main problem being that they will reject transactions from addresses on an OFAC-style list, but if this gains traction then there is no stopping that kind of list from being expanded. The work being done at Laurentia Pool is a crucial step in the right direction; they pay the mining operators directly from coinbase rewards to eliminate potential censorship bottle-necks at the pool’s wallet. I am a firm believer that if there is a white market/black market bitcoin in the future, then the black market will always dwarf the white market. It would be unfortunate to deal with a whitelist handicapped system though. When a person mines Bitcoin at home, they route around exchange-enforced censorship and if they have a Whatsminer pointed at Laurentia Pool, they route around potential censorship of a pool’s wallet.
As of this writing, I have actively been mining for 22 days. In that time, I have generated 0.01412832 bitcoin. If I had spent the money I used in electricity at an exchange to get bitcoin instead, I would only have less than 0.00444536 bitcoin. I would have had to pay exchange fees, given up my KYC information, and then have that bitcoin associated with my identity too if I had bought from an exchange. When a person mines at home, they can get bitcoin much safer and cheaper than buying from an exchange.
GnB: What was the hardest part about setting up your home bitcoin mining operation? What was the easiest part?
Econoalchemist: The hardest part was definitely procuring a machine without getting scammed. I earned a few gray hairs throughout that process. I nearly sent a scammer ~0.25 bitcoin the day after Thanksgiving. I didn’t know anything about mining or what to look out for. People like me are prime targets because we don’t know anyone so we’re more hesitant to ask for help. We don’t know how this works so we’re more likely to screw something up. And we don’t have a lot of money but we have enough to be worth a scammer’s time and effort. If it wasn’t for @Diverter_NoKYC and @Crazyk_031 giving me pointers along the way I would have been lost. Anyone who is interested should check out: https://t.me/Hardwaremarketchannel
The easiest part was plugging in the miner, pointing it to SlushPool, and starting my steady stream of non-KYC sats. I just had to locate the miner’s IP on my home network, open the configuration page, and paste SlushPool’s URL. That was it. Setting up a RasPi node was way more difficult than setting up a miner.
GnB: What other DIY bitcoin related projects have you completed?
Econoalchemist: I’m a fan of securing backup seed phrases in metal, which is a fun DIY project. I’ve tried steel plates, steel washers, & others. I’ve documented most of them on my blog. I also run two RasPi full nodes, one running BitcoinCore, and the other running RoninDojo for my Samourai Wallet and Whirlpool. Both of those endeavors are also documented on my blog. I don’t know how to write code and I’m not a developer, but I am an all-around Do-It-Yourselfer so anything I can do myself I will give it a shot whether that means fixing my own car, fixing a broken water pipe, or mining bitcoin. I really don’t like relying on other people for the things I need, I reluctantly hired an electrician to help me when I was starting my mining endeavor and that ended with me finishing the job myself.
GnB: What are you most looking forward to at BANB2021?
Econoalchemist: First and foremost, I’m looking forward to spending some child-free time with my wife while we engage with a community of people that are as passionate about Bitcoin, guns, and freedom as we are. I’m also looking forward to meeting the people I’ve been interacting with online for the past several months. I consider many of these people friends and I’ve never met any of them. I have a ton of respect for many of the people that will be in attendance and I’ve been looking up to them for the past couple years while I have been venturing down the Bitcoin rabbit hole.
The Samourai Wallet & RoninDojo community in particular has really accelerated my understanding of Bitcoin anonymity and the importance of privacy, they have helped me with every question I’ve ever had and I owe them all a debt of gratitude, so I’m looking forward to being able to say that in person. I hear rumors that Texas has some good BBQ so I’m also looking forward to verifying these claims for myself.