The third edition of NostrWorld’s unconference series took place last week in the picturesque city of Riga, Latvia, bringing together proponents and developers of the Nostr protocol. Led by Block CEO and Twitter co-founder Jack Dorsey, NostrWorld’s free meetups are a platform for open source enthusiasts to exchange ideas, foster collaboration, and develop initiatives aimed at shaping a freer, more decentralized version of the internet.
Bitcoin Magazine was on the ground in Riga to investigate how the evolution of the Nostr protocol could impact Bitcoin’s trajectory. While Nostr’s burgeoning community has attracted prominent Bitcoin proponents, Nostriga – as this third NostrWorld conference was dubbed – offered a fresh look at the growing synergies between these two technologies. Discussions with attendees and observations during the two-day event revealed a clear trend: it seems increasingly likely that Bitcoin’s path will become intertwined with Nostr’s promising social networking technology.
What is Nostr?
Nostr is an open-source protocol designed to create a decentralized, censorship-resistant social network. Unlike traditional platforms that rely on centralized servers, Nostr operates on a network of relays where users can publish and receive messages. Nostr is quickly gaining traction as a social layer for Bitcoin, enabling features like micropayments and digital identity management. Beyond social media, Nostr offers an opportunity to build a new internet architecture that frees users from dependence on centralized platforms. This approach empowers individuals by removing the need for middlemen who typically own user data, monetize attention, and control or censor access.
Market fit for micropayments
A standout moment from the conference was when Jack Mallers, CEO of Strike, shared a personal story about an acquaintance he had been trying to convince for years of Bitcoin’s potential. It wasn’t until she joined Nostr and received Zaps on her account that the power of technology finally clicked for her.
Zaps are small Bitcoin payments, often sent as a tip or reward on Nostr, allowing users to support content creators directly over the Lightning Network. This micropayment feature has become a popular way to demonstrate the usefulness and value of Bitcoin in a social context
The concept of micropayments even predates Bitcoin, but Nostr proponents believe Zaps represents the first successful large-scale implementation of the idea. In a panel alongside Primal CEO Miljan Braticevic, Jack Mallers emphasized the importance of this achievement:
“I think that’s very underappreciated. Something that’s been wanted on the internet for decades. From anonymous cypherpunks to the most powerful people in the world, everyone has wanted this use case and it looks like we’ve achieved that.”
Micropayments through Nostr introduce a new bootstrapping mechanism that could revolutionize the traditional Bitcoin onboarding process. Individuals who may not be swayed by Bitcoin’s economic or political narrative might appreciate its unique value once exposed to informal internet tipping and microtransactions. This shift makes Bitcoin accessible to a broader audience by making it accessible in everyday social interactions that internet users are already familiar with.
Paved the way for the Ecash economy
Ecash, one of Bitcoin’s emerging technologies, was a recurring theme at the event. Cashu protocol developer CalleBTC made an impassioned case for the central role Nostr could play in an ecash-driven economy.
Envisioned as a system for private, scalable payments using blind signatures, ecash allows users to conduct transactions without revealing their identity, thus maintaining financial privacy. However, this privacy comes with a trade-off: ecash introduces trusted entities known as mints, which hold users’ Bitcoin deposits in exchange for tokens, often called banknotes. For eCash to function effectively, a robust coin market is necessary to provide users with options they can rely on. As the concept gains traction, this reliance on multiple coins introduces several coordination and discovery challenges; challenges that developers believe are ideally suited to be addressed by Nostr’s social features.
Examples include bitcoinmints.com and cashumints.space, two Nostr-based websites that offer a Yelp-like interface that allows users to discover new coin providers and allows mints to advertise their services and build a reputation. While initial implementations are quite simple, the potential integration of Nostr’s social graph could allow users to make informed decisions about which mints to trust. By leveraging connections within their network and trusted reviews from friends, users can more confidently choose mints based on the relationships and experiences shared by those they know. Ultimately, the expectation is that similar Nostr-based services will be integrated directly into Bitcoin ecash wallets, providing users with a seamless onboarding experience that avoids the imposition of familiar defaults.
Likewise, Nostr’s infrastructure provides several methods to strengthen the resilience of ecash coins, allowing future deployments to function independently of the Internet’s centralized DNS services. This would allow users to establish direct connections to mints, reducing their exposure to third-party interventions and improving the overall security and decentralization of the ECASH system.
Another fascinating concept to emerge from the convergence of ecash and Nostr communities is the idea known as ‘nutsack’. Nutsack or NIP-60, introduced by Nostr developer PabloF7z, allows users to store ecash notes on Nostr relays, effectively distribute them across the network and associate them with the user’s identity. In fact, the scheme provides universal access to a user’s cash through any Nostr client that supports the feature. This means that in the future, users will be able to log into any website or online service and track their cash balance seamlessly, enabling effortless spending across multiple platforms.
Communities and Web-Of-Trust
One of the biggest opportunities – and perhaps the most important challenge – for Nostr is the ability to reach new internet communities beyond the Bitcoin-focused groups that currently dominate the platform. Announcements like developer Alex Gleason’s Ditto, made last week, have the potential to expand Nostr’s reach into the broader landscape of existing internet communities like Mastodon, paving the way for broader adoption.
“With Ditto, people find websites they want to join for a community and then discover Nostr as a side effect, giving them the opportunity to learn what it is and why it matters,” Gleason explained in his presentation.
This strengthening of Nostr’s network effect could have significant implications for Bitcoin adoption. With features like Zaps, Nostr offers a unique opportunity to introduce non-technical users to the power of an internet-native currency, making Bitcoin more accessible and recognizable in everyday digital interactions.
“Bitcoin is revolutionary and I believe it is key to Nostr’s success, but social media needs communities.”
Looking ahead, the formation of communities and the adoption of Nostr as an identity system could pave the way for digital economies rooted in the web-of-trust concept. By building social graphs from cryptographically signed messages, users can spread their reputation across the internet, laying the foundation for secure, decentralized commerce that operates independently of traditional laws, contracts and enforcement mechanisms – with Bitcoin at the center of it all.
