‘Elegant and ass-backward’: Jameson Lopp’s first impression of Bitcoin
Jameson Lopp has been on the front lines of the battle between technologists and those who want to preserve Bitcoin as it is since the scaling debates of 2015–2017.
The topic arouses such passion that many suspect it was a disgruntled Bitcoiner opponent who called down an armed SWAT team to his home, leading him to famously go underground.
Lopp blamed the 2017 incident on the “same old same old: Bitcoin philosophy and scaling debate arguments. A few of the more extreme cases think I’m some kind of manipulative monster.”
Lopp, who is currently the chief technology officer for decentralized wallet service Casa, is an advocate for cautious progress who commands respect among the Bitcoin community.
Speaking from an undisclosed location, Lopp says he worries the backlash against Ordinals NFTs might result in lower support for much-needed future upgrades. Ordinals were largely an unexpected result of the 2021 Taproot soft fork.
“The problem that I see is that there’s a lot of ossification proponents out there. And they’re pointing at Ordinals and inscriptions and saying, ‘You see, this is what happens when you change the protocol. It gets abused and used in ways that were not intended,’” he says.
But Lopp says the alternative is every bit as risky. He has carefully considered the problem of Bitcoin’s “ossification” — where the network becomes so big “it kind of gets crushed under its own weight and unable to change itself.”
Lopp uses email as an example of an internet protocol that ossified in the 1990s, leaving it with little ability to deal with the massive volumes of spam that subsequently arose.
Instead, corporations constructed expensive centralized reputation services on top to sort out spam from legit emails, and today, large numbers of emails that don’t comply with the arcane rules of the systems simply disappear into a black hole. And users are still deluged with spam.
“As of today, something like 90% of all email users are captured by five corporations. So, I think we have to ask ourselves: Is that the mainstream adoption of Bitcoin that we want to see? And if not, then what do we need to do to prevent that?”
For Lopp, scaling Bitcoin — something he’s been agitating for, for years — remains the big challenge as the Lightning Network is “not going to fix everything.”
“If you talk to any of the developers, who’re pretty deep into the protocol, you’ll be hard-pressed to find any of them who think that we should ossify the protocol now. There’s so much work to be done.”
“Honestly, I don’t know how much time we have left to do that.”
Historically, Lopp’s company Casa has been solely focused on Bitcoin, but last month, it outraged puritans on social media by adding Ethereum to its multisignature self-custody solutions. It highlights the fact Bitcoin has a fast-growing challenger snapping at its heels if it lets up the pace.
Who is Jameson Lopp?
Lopp grew up in a “fairly typical Southern American conservative household” in North Carolina, where his father’s side of the family has lived since the 1700s. It was clear from early on that he was super bright, and his parents pushed him hard to achieve great things at school.
“I read probably several grades above my reading level, and I read all the time. I had a special exemption at the library to check out more books than you are normally allowed to just because I was going through such a high volume of them.”
Placed into high-level courses, he often wound up sitting on his own doing separate assignments from the rest of the class, something of a “social outcast.”
“On the social side, I would just get even more awkwardness and sort of abuse because I would sometimes use vocabulary that nobody else was using, and they were like, you know, ‘Who is this alien guy?’”
Lopp ended up joining Mensa in 2010, mainly to see if he could pass the test requiring an IQ in the top 2%. Naturally, he set up a Mensa Bitcoin special interest group, though he says super-smart people don’t necessarily get Bitcoin any faster than anyone else and points to the dismissive reaction to Satoshi’s original announcement about Bitcoin.
“The people who were responding to that email were not stupid. They were incredibly intelligent people. But if you’re intelligent enough, you can always find reasons why something won’t work.”
Coming of age
After school, Lopp headed to study computer science at the “very liberal” University of North Carolina at Chapel Hill. Brought up to be a very conservative Republican, he says university “swung my perspective a little bit more outside of the sort of family and household standards that I had been used to.” He ended up voting for Obama in 2008, Libertarian in the following election, and now believes he can have more impact building decentralized financial infrastructure than voting.
“These days, I view politics at a very arm’s length amused perspective.”
He worked in email marketing for years in one of the tech areas near Raleigh, moving up from working on the web app to large-scale data analysis. Like most people in tech, he read about Bitcoin a few times and dismissed it as “nerd money that was going to end badly” before finally reading the white paper in 2012.
“I was just blown away,” he says, noting that Satoshi approached the double-spending and Byzantine generals problem from the exact opposite direction of the “performance and efficiency” mindset Lopp had been taught.
“When I read the white paper and I saw the solution to the problem, I was amazed because it was both elegant and ass-backward,” he says.
“The solution was to make everything really, really expensive in terms of resource usage. I was like, wow, I never in a million years would have thought to try that because it just goes against our nature as computer scientists.”
Bitcoiners back then were primarily libertarians, cypherpunks and crypto-anarchists, and the chance to find an alternate way forward was part of the appeal.
“We can build alternative power structures, alternative systems that don’t rely upon any of the existing infrastructure. And basically, we can create our own rules for how these systems should operate.”
Lopp forks Bitcoin Core
Within two years, Lopp had created a fork of Bitcoin Core called Statoshi to “bring more transparency and understanding to the internal operations of a Bitcoin node.” He applied for a grant from the Bitcoin Foundation to work full time on the project but never heard back. Five years later, he discovered he’d been successful, but the foundation fell apart before he received any money.
Lopp also applied to work at Coinbase in 2015 and “never even got an interview,” but his work on Statoshi did land him a gig running the nodes for institutional custody and infrastructure provider BitGo. He also began to nurture his public profile, ramping up his research and writing — he’s written for CoinDesk, Cointelegraph and Forbes — tweeting more often, organizing Meetups and presenting at events. He’s now a regular at conferences around the world, but it wasn’t easy to start.
“I’m definitely an introvert, though you wouldn’t know it because I do all of these public speaking events. But that took a lot of practice to do.”
Lopp says the block size wars (2015–2017) was the period when he started to become really well-known in Bitcoiner circles. Initially, he was on the big blocks side, writing an article in 2015 calling for an increase in the 1MB size of blocks to increase capacity and suggesting blocks may one day hit 10GB. He also supported the Bitcoin XT fork of Bitcoin Core, which ended up part of Bitcoin Cash.
“That was really a result of what I had been doing as an engineer for the past decade,” he says, adding that he’d spend much of each year prepping for the Black Friday and Cyber Monday sales because “if you couldn’t handle that, then it would be a bad user experience, you would lose customers, you would lose money, and the business would not grow as quickly.” He didn’t want Bitcoin to lose potential users through a bad experience with the slow, expensive blockchain.
However, his perspective started to change when he realized the impact bigger blocks would have on his own work at BitGo, writing services that talked to the nodes.
“I started to see the opposite side of the argument,” he explains. “Even with these ‘tiny’ 1MB blocks, it was quite challenging for me to write services that could ingest all of this blockchain data at a very fast pace.”
It took weeks sometimes to get a new indexing service up and running from scratch, and doubling or tripling the block size would require exponentially more resources “to the point where only the largest enterprises who had a lot of money to throw at this problem would even be able to run the nodes and the services on top of them.”
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So, while Lopp ended up strongly supporting SegWit as a practical solution and thinks Bitcoin is superior to any other cryptocurrency as “sound money,” he also sees room for experimentation on other protocols, and on Bitcoin.
“A lot of people get very ideological and, in some cases, puritanical about this stuff,” he says. “Bitcoin is not a kitchen sink type of protocol there. There’s a lot of things that you can’t do on Bitcoin that you can do with other protocols.”
Su Casa, mi Casa
Lopp joined the decentralized Bitcoin self-custody service Casa in 2018 and was soon promoted to chief technology officer. He also has the title of co-founder. Casa is an alternative to centralized custodians and offers a range of multisignature wallet plans that enable users to avoid losing their funds in security incidents and to recover lost or stolen keys.
Casa began support for Ethereum last month and claims it’s the first company to enable self-custody of both Bitcoin and Ether with up to five keys for distributed security. ERC-20 and NFT support is in the works.
“Obviously, there were a few clients who fell into the sort of extreme Bitcoin-only camp who went their own way,” says Lopp, adding that this was expected. “Really, it’s this loud, tiny minority that can seem a lot bigger than they are if you’re on social media. But in reality, I would say most of our clients and most Bitcoiners, in general, are pretty moderate and kind of apathetic about all of the drama.”
He says the decision resulted from user demand because many existing clients “do have more diverse portfolios, and they want to have that same level of security for assets other than Bitcoin.”
The loud, tiny minority goes SWATing
The famous SWATing incident happened after his views began to evolve. A 911 caller claimed to be holed up at Lopp’s house with hostages, having already shot someone.
“By my voice, you can tell I’m not in a mental health state right now. I’m on drugs. I’m all over the place. I don’t know what to do. […] If I don’t get $60,000, I’m going to blow the whole fucking block up.”
Heavily armed cops arrived at his home, guns drawn. Lopp wasn’t home at the time and arrived to find his neighborhood shut down and crawling with dozens of patrol units, a SWAT team, a mobile command post, a fire truck and a paramedic. He had a conversation with a cop to find out what happened, not realizing he was the suspect.
Following the incident, Lopp tweeted a video of himself firing off an AR-15 rifle as a warning to anyone trying to find him.
The incident also inspired Lopp’s radical privacy experiment to live off the grid and off the radar of the authorities. Apart from standard stuff like using VPNs, private mailboxes and using fake names, it also involved setting up a bunch of limited liability companies to apply for bank accounts and credit cards one step removed. He mainly spent cash, used burner phone numbers and even bought “the crappiest, cheapest hole in the wall I could find that has a physical mailbox” as a physical address to get a driver’s license.
“I determined that the amount of effort and especially money that is required to do it is going to price almost everybody out of doing this,” he says, adding the fact that you have to lie to everyone was also likely to deter people from trying it.
“Everyone in my physical proximity, my neighbors, they only know my pseudonym. And you know, I have my backstory, and I literally had to create this whole alternate persona, but not so different, it would be difficult for me to make it believable. So, like, I’m still a software engineer who knows a lot about security.”
Lopp maintains a GitHub list of “known physical Bitcoin attacks,” which spans from Hal Finney getting SWATed in December 2014 to a couple in Queens, New York who in mid July were mugged by assailants disguised as FBI agents that stole their car, $40,000 in cash and their crypto.
The No. 1 lesson to take from the list is that the fewer people who know they can rob you of your crypto by threatening you with a $5 wrench, the better. So it’s interesting to learn that prior to his SWATing, Lopp used to drive around in a flashy Lotus Elise with a BITCOIN license plate, basically inviting attacks.
Although many people thought it was a Lamborghini, Lopp says that “it was actually a salvage title car that I got for $20,000.” He eventually sold it, but he has the BITCOIN license plate hanging on the wall behind him during our interview as a memento. These days, Lopp drives “extremely common vehicles that are mass-produced by the millions.”
Future progress for Bitcoin
Pushing for progress on Bitcoin while not destroying all of the things Bitcoiners hold dear has always been a thorny problem. Roger “Bitcoin Jesus” Ver couldn’t solve it and went off with the Bitcoin Cash camp, who then split off with Craig “No, I really am Satoshi” Wright heading up Bitcoin SV.
There are also Bitcoiners trying to change it from within, like Eric Wall and Udi Wertheimer, who have embraced Ordinals. Wall is also investigating scaling Bitcoin using the same zero-knowledge proof technology being used to scale Ethereum via Starknet.
Lopp says he’s focused on a variety of improvements that can be made to “let people start building more outside of the base protocol.”
“You don’t need to go through the same onerous process to develop on a second layer, you don’t have to make these sweeping consensus changes that are really risky,” he explains.
“That’s one of the reasons why I want to see a lot more second layers other than just Lightning. I want to see more sidechains, drive chains, rollups, so on and so forth. Because I think that that is going to enable more innovation, more experimentation.”
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Sir Keir Starmer has promised to bring down migration numbers by tightening up the rules on those allowed to come to the UK.
The prime minister promised his new plan will reduce net migration – the difference between immigration and emigration – by the end of this parliament in 2029.
Details of the plans have been published in a white paper, a government document that outlines policy proposals before being introduced as legislation.
Politics latest: Starmer makes migration vow as he unveils crackdown
Sky News has combed through the white paper to bring you the details.
Language requirements
All visa routes will require people to have a certain level of English proficiency.
People coming with the main visa holders – dependents – will also have to have a basic understanding of English, which they currently do not.
The level of proficiency needed depends on the visa, with a skilled worker visa requiring at least upper intermediate level. Currently, it requires just an “intermediate” level.
To extend visas, people will have to show progression in their English.
Keir Starmer announced the changes at a podium with ‘securing Britain’s future’ on the front. Pic: PA
Settled status
Currently, people have to live in the UK for five years before they can gain settled status.
Under the new plan, they will have to live in the UK for 10 years.
However, “high-contributing” individuals such as doctors and nurses could be allowed to apply for settled status after five years.
A new bereaved parent visa will be created so those in the UK who have a British or settled child that dies can get settled status immediately.
Settled status gives people the right to work and live in the UK for as long as they like, and provides them with the same rights as citizens, such as healthcare and welfare and the right to bring family members to live in the UK.
People with settled status can then choose to apply for British citizenship.
Read more:
Restricting staffing during shortage has care sector worried
UK-US trade deal ‘isn’t worth the paper it’s written on’
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Sky’s Sam Coates questions PM on migration
British citizenship
People can qualify sooner for citizenship by contributing to UK society and the economy, like settled status.
The Life in the UK test will be reformed.
Social care visa
This visa, which allowed care workers to come to the UK due to a shortage, will not exist anymore.
There will be a transition period until 2028 when visa extensions and switching to the visa for those already here will be allowed.
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‘We risk becoming an island of strangers’
Skilled worker visa
People wanting to come to the UK on a skilled worker visa must now have at least an undergraduate university degree. The minimum was previously A-levels.
There will also be tighter restrictions on recruitment from overseas for jobs with “critical” skills shortages, as well as strategies to incentivise employers to increase training and participation rates in the UK.
Very highly skilled people, in areas the government identifies, will be given preferential access to come to the UK legally by increasing the number of people allowed to come through the “high talent” routes such as the global talent visa, the innovator founder visa and high potential individual route.
A limited pool of refugees will be allowed to apply for employment through the skilled worker route.
Skilled worker visas will now require at least a university degree, with preferential access for highly skilled people. Pic: PA
Study visas
People on graduate visas will only be allowed to remain in the UK for 18 months after they finish their studies.
Currently, students finishing degrees can stay for two years if they apply for the graduate visa, or those finishing PhDs can stay for three.
Institutions sponsoring international students will have their requirements strengthened, with those close to failing their sponsor duties placed on an action plan and limits imposed on the number of new students they can recruit.
Sponsors, who can cover tuition fees and living costs, include overseas governments, UK government scholarships, UK government departments, UK universities, overseas universities, companies and charities.
Humanitarian visa
The Ukraine, Hong Kong and Afghanistan humanitarian visa routes will remain.
However, the government will review the effectiveness of sponsorship arrangements for those schemes so businesses, universities and community groups can “sustainably” sponsor those refugees.
The government will continue to support humanitarian visas, such as the Afghanistan one after the Taliban took over Kabul in 2021. Pic: AP
Domestic worker visa
To help prevent modern slavery, the government will reconsider this visa, which currently allows foreign national domestic workers to visit the UK with their employer for up to six months.
Businesses
Companies wanting to bring people from abroad to work for them in the UK will have to invest in the UK first.
To prevent exploitation of low-skilled workers on temporary visas already in the UK, the government will look at making it easier for workers to move between licensed sponsors for the duration of their visa.
The right to family life
A growing number of asylum seekers have used the “right to family life” – Article 8 of the Human Rights Act – to stop their deportation.
Legislation will be introduced to “make clear it is the government and parliament that decides who should have the right to remain in the UK”.
It will set out how Article 8 should be applied in different immigration routes so “fewer cases are treated as ‘exceptional'”.
A group of migrants was brought into Dover by Border Force as the PM announced immigration changes. Pic: PA
Foreign national offenders
The Home Office will be given powers to more easily take enforcement and removal action, and revoke visas in a much wider range of crimes where people did not serve jail time in other countries.
Deportation thresholds will be reviewed to take into account more than just the length of their sentence, with violence against women and girls taken more seriously.
Enforcement
Sir Keir said the immigration rules – at the border and in the system – will be more strongly enforced than before “because fair rules must be followed”.
People who claim asylum, particularly after arriving in the UK, where conditions in their home country have not materially changed, will face tighter controls, restrictions and requirements where there is evidence of abuse of the system.
Other governments will be made to play their part to stop their nationals coming to the UK, or from being returned.
Sponsors of migrant workers or students abusing the system will have financial penalties or sanctions placed on them, and they will be given more support to ensure compliance.
People on short-term visas who commit an offence will be deported “swiftly”.
Scientific and tech methods will be explored to ensure adults coming to the UK are not wrongly identified as children.
eVisas, which have now replaced physical documents, will help tackle illegal working and support raids on those overstaying their visas or on the wrong visa.
Major banks are legally obligated to refuse current accounts to individuals suspected of being in the UK illegally and to notify the Home Office. This will be extended to other financial institutions.
Nigel Farage has told Sky News he would allow some essential migration in areas with skill shortages but that numbers would be capped.
The Reform UK leader said he would announce the cap “in four years’ time” after he was pressed repeatedly by Sky’s deputy political editor Sam Coates about his manifesto pledge to freeze “non-essential” immigration.
Politics latest: PM accused of ‘shameful’ language in migration crackdown
It was put to Mr Farage that despite his criticism of the government’s migration crackdown, allowing essential migration in his own plans is quite a big caveat given the UK’s skills shortages.
However the Clacton MP said he would allow people to plug the gaps on “time dependent work permits” rather than on longer-term visas.
He said: “Let’s take engineering, for argument’s sake. We don’t train enough engineers, we just don’t. It’s crazy.
“We’ve been pushing young people to doing social sciences degrees or whatever it is.
“So you’re an engineering company, you need somebody to come in on skills. If they come in, on a time dependent work permit, if all the right health assurances and levies have been paid and if at the end of that period of time, you leave or you’re forced to leave, then it works.”
Read more:
What are Starmer’s new immigration rules?
The choice facing Labour in face of Reform threat – analysis
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‘We need to reduce immigration’
Reform’s manifesto, which they call a “contract”, says that “essential skills, mainly around healthcare, must be the only exception” to migration.
Pressed on how wide his exemption would be, Mr Farage said he hopes enough nurses and doctors will be trained “not to need anybody from overseas within the space of a few years”.
He said that work permits should be separate to immigration, adding: “If you get a job for an American TV station and you stay 48 hours longer than your work permit, they will smash your front door down, put you in handcuffs and deport you.
“We allow all of these routes, whether it’s coming into work, whether it’s coming as a student, we have allowed all of these to become routes for long-term migration.”
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Sky’s Sam Coates questions PM on migration
Asked if he would put a cap on his essential skills exemption, he said: “We will. I can’t tell you the numbers right now, I don’t have all the figures. What I can tell you is anyone that comes in will not be allowed to stay long-term. That’s the difference.”
Pressed if that was a commitment to a cap under a Reform UK government, he suggested he would set out further detail ahead of the next election, telling Coates: “Ask me in four years’ time, all right?”
Mr Farage was speaking after the government published an immigration white paper which pledged to ban overseas care workers as part of a package of measures to bring down net migration.
The former Brexit Party leader claimed the proposals were a “knee jerk reaction” to his party’s success at the local elections and accused the prime minister of not having the vigour to “follow them through”.
However he said he supports the “principle” of banning foreign care workers and conceded he might back some of the measures if they are put to a vote in parliament.
He said: “If it was stuff that did actually bind the government, there might be amendments on this that you would support. But I’m not convinced.”
Opinion by: Robin Singh, CEO of Koinly
Is there a catch for Bitcoin hodlers, with the asset’s price up over 600,000% since the beginning of 2013?
Perhaps — if governments keep waking up to Bitcoin’s value, the whole “you only pay tax when you sell” mantra could soon be a thing of the past.
What if a wealth tax is the answer for revenue-hungry tax agencies with no time to lose? It’s a yearly tax on a person’s total net worth — cash, investments, property and other assets — minus any debts, applied whether or not those assets are sold or generating income. The idea is to boost public revenue and curb inequality, mainly by taxing the ultra-rich. A wealth tax takes a clip off what you own, not what you earn.
Countries such as Belgium, Norway and Switzerland have had wealth taxes baked into their tax systems for ages, yet some of the world’s biggest economies — like the US, Australia and France — have largely steered clear.
That might be changing. More governments are eyeing wealth taxes for crypto. In December 2024, French Senator Sylvie Vermeillet took it a step further, suggesting Bitcoin (BTC) be labeled “unproductive,” which would mean taxing its gains every year — whether or not it’s ever sold.
Yep, every asset holder’s favorite word is unrealized capital gains tax. It would be naive to assume other countries are not thinking about the same idea.
With Bitcoin’s significant gains and industry executives such as ARK Invest’s Cathie Wood eyeing a $1.5-million price tag by 2030, I’d bet a magic 8-ball would say, “Signs point to yes.”
The growing global interest in wealth tax
It might seem far-fetched, but it is hard to ignore the gains. The average long-term Bitcoin holder is already sitting on significant profits.
The incentive is obvious. Switzerland’s wealth tax goes up to 1% of a portfolio’s value, and governments know there is plenty to collect.
Countries catch on — sooner or later. Consider how capital gains tax became the norm.
The US introduced capital gains tax in 1913, the UK jumped on board 52 years later in 1965, and Australia followed in 1985.
Governments likely considering the wealth tax
Governments are likely entertaining the idea — whether they admit it or not. If any country seriously considers it, Germany could be a prime candidate, even though it scrapped its wealth tax back in 1997.
Recent: Ukraine floats 23% tax on some crypto income, exemptions for stablecoins
In July 2024, offloading 50,000 seized BTC at $58,000 might have seemed like a smart move for the German government, but when Bitcoin hit $100,000 just months later in December, it became clear they left a fortune on the table.
In retrospect, a costly mistake…
Will this be remembered as a blunder on par with Gordon Brown selling half of the UK’s gold reserves at $275 an ounce?
Imposing such a rule on the wealthy comes with obvious risks.
To understand the real effect of taxation on a country, just follow the money — specifically, where millionaires are moving. Recent data shows that high-net-worth individuals are leaving countries like the United Kingdom in droves, heading for tax-friendly havens like Dubai.
The potential repercussions of a wealth tax
Will nations risk losing these individuals to tap into unrealized gains on Bitcoin and other assets?
Bitcoin is volatile and full of unknowns. While some events could lead to massive losses, governments may still push forward with policies that ultimately drive away millionaires, only to realize the trade-off wasn’t worth it.
Conversely, US President Donald Trump recently signed an executive order establishing a Bitcoin Strategic Reserve — a clear nod to the hodl mentality. No doubt, this has other nations considering a similar move.
If nations are embracing the hodl mindset, could that mean wealth taxes are off the table in those countries? Only time will tell.
One thing is sure: Bitcoin hodlers have amassed enough wealth to put themselves on the radar of tax authorities. Whether this sparks fundamental policy changes or just political grandstanding, the crypto community won’t sit back quietly.
Opinion by: Robin Singh, CEO of Koinly.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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