Bitcoin is a revolution. Well, that’s what they say, anyway. Who are they? The believers. The denizens of online chat rooms and boards who belong to ideologies that most people will never encounter in the real world. The most popular strain that runs through bitcoin believers, though, is the belief that governments are not serving their citizens well. This anti-government view is propped up by movement heroes like Edward Snowden and Chelsea Manning, and the unlikely inclusion of Ross Ulbricht and Roger Ver. Bitcoin, the believers will tell you, is change. Bitcoin will remove the status quo and replace it with something new and better. Rapid, exciting, and non-stop change. So why is the bitcoin movement finding it so difficult to change their own status quo when it comes to topics like censorship, transaction capacity, mining decentralization, and competitor “alt-coins”?
A group of individuals separated geographically and linked by their interest in a commodity unlike any before it is bound to have interesting debates. A feature of the internet generation has been the skewing of online expression toward extreme views. In person, interaction is moderated by social norms and real time expressions of judgment. If an individual begins to spout racial slurs it is likely that one or more folks will take come kind of action which will lead to this behavior ending. Not so on the internet, where the boundaries of moderate tone and polite discourse are routinely disregarded. The bitcoin watering holes are echo chambers; you’ll only hear pro-bitcoin statements, anything else is regarded as baseless FUD.
This amplifies the beliefs and common understanding of bitcoin believers. Anyone poking holes in the community’s accepted narrative must be an outsider with an agenda. Everyone is against bitcoin. Banks, lawmakers, the elites, the uneducated. Everyone fears the change that bitcoin will bring. Never mind that a single ultra-wealthy individual could destroy bitcoin either by dominating the market or simply spamming the blockchain. Never mind that there are legitimate criticisms of the current state of bitcoin. No, never you mind that in all likelihood the banks, the elites, the average person, they probably don’t care about bitcoin at all.
The more pressing problem exists within bitcoin, however. Believers have been hearing about things like Lightning Network (LN) and Segregated Witness (SegWit) for years. Almost since bitcoin arrived there were proposals for improvements, and the common insult of “vaporware” haunts many such proposals. The transaction rate of bitcoin is an extremely contentious issue and continues to divide the bitcoin community. The intransigence of individuals like Theymos and Luke-Jr coupled with the venom the community possesses for professionals who dare to oppose the movement has crippled the advancement of bitcoin. Good news is maybe on the horizon this week as LN will begin to be propagated for approval by miners, but with a 95% requirement for adoption the proposal may fall short.
The perceived leaders of the movement also leave much to be desired. To the casual observer, Ross Ulbricht is a slam dunk case of someone who should be in prison: murder for hire, running a massive drug selling operation, and a slew of other charges. To the anti-government type this is a classic overreach by a government that has no business regulating what should be freely available substances, and the intended murder charges were just mud-slinging by a spiteful government servant. Roger Ver has run afoul of the U.S. government for explosive charges, has personally vouched for the woefully dishonest Mt Gox exchange, had a public breach of contract spat with OKCoin, an unregulated and semi-legitimate exchange, and most recently been accused of manipulating miners for his personal goals. Of lesser note, but no less accomplished in saying and believing ridiculous things is Luke-Jr, a developer whose notion of Christianity can politely be termed extremist. In addition to his personal leanings, Luke-Jr’s caustic interpersonal relationships have helped drive away mainstream developers and contributors, likely hampering some of the changes bitcoin needs.
It’s been years. Wall Street has kept chugging along. The stock market is at a record high. Somehow Donald Trump has been elected President. All the promises of bitcoin haven’t materialized. A community galvanized around their hope for the fall of modern economics has been consistently thwarted by the resilience of the markets. Much like goldbugs before them, the perverse hope for an economic crash to validate their beliefs belies a high degree of narcissism. An individual who hopes for personal gain at the expense of massive losses for millions is a special kind of individual. Bitcoin continues to process a tiny fraction of the transactions that modern banks handle. Bitcoin continues to be more expensive that even Western Union. Bitcoin is highly centralized by a few massive miners and a few massive exchanges, all in a nation that could rule both activities illegal overnight. Riddled with scams and dominated by a toxic community, what is the way forward for bitcoin? I can’t tell you. Maybe Ether or Zcash will pick up where bitcoin has failed. We need to make cryptocurrency great again.
Bitcoin logo – Public domain image by Bitboy (Bitcoin forums)
AUSbitcoins logo (yellow bitcoin image) – Public domain image by Satoshi (Source)