Cryptocurrency: Bitcoin... 14 Years... Of What?
grarpamp at gmail.com
Tue Nov 1 20:15:08 PDT 2022
14 years... of lack of privacy, scale, adoption...
Bitcoin's utxo's must change to adopt these before 15y or
be forked again and otherwise superceded and shifted-out
by competitors... the leading coins and communities of which
will also no longer ass-kiss regulators either. Instead of doing
those... this week BTC did birthday party on into night under
the silliness of Lightning's glow...
14 Years After The Bitcoin White Paper; Reflecting On Satoshi
14 years later, Bitcoin has shown its strengths... and that it still
has a long way to go to achieve its original goals...
When Satoshi Nakamoto first published the Bitcoin white paper in
October of 2008, the world was reeling from a financial crisis caused
by the irresponsibility and negligence of the institutions that
controlled our financial system. Hedge funds, central banks and other
powerful agents had been all too happy to place over-leveraged bets on
the economy, and to profit from the economic losses incurred by the
working class when these bets collapsed.
Governments, in a desperate attempt to keep these institutions alive,
spent hundreds of billions of dollars in bailouts and other monetary
injections instead of ensuring the well-being of the average citizen.
Bitcoin was Satoshi Nakamoto’s answer to state-backed money; it was a
vision for a decentralized digital currency that could provide the
efficiency of online banking, the relative pseudonymity of physical
cash, and the scarcity of gold.
Unlike previous attempts at creating digital cash, Bitcoin was not
backed by or controlled by a singular entity or party, but rather by
an anonymous developer (developers?), a set of faceless forum visitors
and a small online community that believed in using cryptographic
software for privacy and independence from authoritarian powers.
Nakamoto’s ultimate goal was to create an asset that was autonomous,
decentralized and was not susceptible to the greed or will of any one
individual. October 31, the day Satoshi Nakamoto formally announced
their white paper to the Cypherpunks Mailing List, has come to be
known as “Bitcoin White Paper Day” and is celebrated as an informal
declaration of independence from corrupt state-backed money, heard
across the world. The purpose of this article is to reflect on how far
we have come since then, and how much work remains to be done in order
to accomplish Nakamoto’s goals.
The Bitcoin that we use today is vastly different from the Bitcoin
that Satoshi Nakamoto and his fellow contributors created in the late
2000s and early 2010s. Beyond the numerous technical upgrades and hard
forks, the network itself has grown significantly, with more and more
people taking the proverbial “orange pill” and deciding to use bitcoin
in some capacity.
There is another way in which Bitcoin has changed: the core network,
and asset (BTC), is thought of more as a store of value rather than a
platform for micropayments. Indeed, there was a significant cultural
schism within the Bitcoin community that led to this change: the
famous, and aptly titled, “Blocksize Wars” approximately five years
ago led to this change, with forks such as Bitcoin Cash and later
Bitcoin SV being created by community members who believed in
scalability over all else, and the core Bitcoin chain being upheld by
members who sought to preserve decentralization and to look at
alternative methods such as Layer 2 payment channels to support
scalability. The Lightning Network, which is the most popular payment
channel, has slowly gained popularity, recently reaching a capacity of
Despite these changes, the core technological tenets espoused by
Nakamoto in 2008 (Nakamoto Consensus with proof-of-work mining and a
static maximum supply of 21 million) remain constant. This is not
solely because of a technological or economic reason; in fact, it has
been argued that changing Bitcoin’s underlying consensus mechanism or
supply cap could lead to increased performance and adoption
respectively. Rather, Bitcoin’s consistency in these areas can be
attributed to the philosophy of its underlying community, who believe
strongly in scarcity, security and decentralization over all else.
Meanwhile, bitcoin is being used by people around the world to stave
off unruly economic conditions. Bitcoin’s natural scarcity makes it
attractive for citizens where corruption has led to unrestricted
inflation. This adoption has even led some governments, such as El
Salvador, to declare bitcoin a national currency, a move that would
have been unfathomable to Nakamoto and Bitcoin’s original
Perhaps the most interesting thing to take from Bitcoin’s progress
over the past couple of years is that it has happened without a
central leader: unlike alternative assets that are more akin to
decentralized software platforms, bitcoin functions purely as money,
with key “policy” decisions being made by a community. There is no
Bitcoin organization or representative solely responsible for
promoting adoption, nor is there a central “chief scientist” that has
a significant impact on key protocol-level decisions. While there are
certainly major influences within the community, the protocol as a
whole does not have an organizational structure to lead either
adoption or development. In fact, Bitcoin’s lack of hierarchy should
be a goal for other distributed ledger projects who, while perhaps
decentralized to a certain degree, are still largely influenced by a
singular entity or individual.
While Bitcoin has certainly grown from its humble beginnings as a
white paper and a couple hundred lines of scrappy code, it still has a
long way to go if it is to achieve the ambitious goals discussed by
Nakamoto and other early adopters in their email chains and forum
posts. From a technical standpoint, the Bitcoin community needs to
continue building technology that not only enables further scalability
and security, but perhaps more importantly, also helps make the
network more decentralized. One of the most staunch mottos that
Bitcoin community members have adopted is the term “Don’t trust,
verify.” This is, of course, in reference to running a full Bitcoin
node and not relying on data from external third parties, such as node
providers. Network optimization, rollups, and other scalability
research has been proposed by various individuals in the Bitcoin
community as a way for the network to simultaneously scale while
decreasing the cost it takes to run a full node. A recent report,
published by John Light through research funded by the Human Rights
Foundation, Starkware and CMS Holdings, provides more detail about
rollups-related scalability research.
Despite its roots in technology, Bitcoin has evolved over the years to
become something more: it is now a community, a network, if you will,
of like minded-individuals who all have some varying degrees of belief
in a singular idea. Bitcoin is no longer a software, privy to only
developers, coders or those with a highly technical background, and
this marked shift should also signal additional non-technical
priorities for the Bitcoin community to address over the next decade.
More effort needs to be spent on educating the general public and
making them aware of not only Bitcoin’s technology, but also the
failures of the legacy financial systems that they use today. More
effort needs to be spent not only on touting bitcoin’s economics and
technology, but also drawing on distinctions between bitcoin and other
cryptocurrency platforms. Finally, more effort needs to be made among
the cryptocurrency community as a whole to come together when the
fundamental principles that Satoshi Nakamoto and his fellow
cypherpunks believed in are threatened by authoritarian governments,
regardless of the platform that is being attacked.
While discussions around varying blockchain networks have always been
tribalistic to a degree, the recent trend has been to promote the
success of your platform over all else, and even chide or insult
platforms who face potential regulatory scrutiny. While believing that
bitcoin is the most sound digital asset in terms of
economics/construction, and getting into arguments about said belief
is okay, and should even be encouraged, celebrating when an
alternative platform is threatened with regulatory action or
censorship goes against what Bitcoin is fundamentally all about.
The cypherpunks, Satoshi Nakamoto and a majority of Bitcoin’s
community all believe in the idea that one day, there can be a digital
peer-to-peer currency completely independent of any government,
intermediary or biased party. While we certainly have various
disagreements about the pros and cons of our respective technology,
belong to different “maximalist” groups, and in general have varying
beliefs, we all ultimately belong to a space that was motivated by the
idea of a censorship-resistant and non-partisan digital asset/network.
We would do well to remember that fundamental principle as we continue
to work on Bitcoin over the next 14 years.
Tweet from Erik Vorhees on the sanctioning of Tornado Cash and
potential BTC regulation by ESG proponents.
More information about the cypherpunks