Satoshi’s Choice
My prior posts have tended to be largely focused on the economics of Bitcoin. Lately, I’ve been paying more attention to the psychology and sociology of Bitcoin. I’m not a cultist or a religious zealot. Never have, never will be. I do, however, find it fascinating to see how many people have adopted a cult-like approach to the debate about “Scaling Bitcoin.”
I consider myself a free-thinker. If & when the facts change, I will change my mind. I abhor labels and avoid groupthink. I have found in my experience that even in the most heated of debates, maintaining composure and mutual respect will almost always lead to a positive outcome, if so desired. I like to think of myself as a calm and levelheaded individualist, who seeks out solutions that serve the greater good, but are still aligned with my core beliefs and principles.
But, I’m afraid that as a broader community, we are so far away from adopting this type of mindset, that finding a resolution to the current impasse is very unlikely in the short term, without exogenous pricing pressure being applied or another external catalyst for change emerging.
One only has to look at the emotive (and often insulting) replies to many of my tweets to realize how heated this debate is, and in fact, how emotional people become when placed under the effects of long term fatigue around the current situation. When emotions get the better of us and we can no longer respond with the requisite amount of decorum, our judgement becomes impaired. And when that happens, bad decisions are often made in favor of progress and alleviating the emotional strain, not the greater good.
Most people I encounter in the Bitcoin world largely care about the price of Bitcoin and whether it’s going up or down. They are emotionally invested in its future as a store of value and a digital currency. I think I covered my views on this pretty well, in my previous piece, For The Love of Bitcoin, so I’m not going to recycle that content here.
That said, I still believe that only a Bitcoin price below $875 would force parties to reach an agreement, which was my thesis when I wrote The Power of the Invisible Hand. I did not expect that market forces would keep the Bitcoin price above $1,000 for long because I believed that the incentive to move forward was not there and therefore the market would adjust. Clearly I was wrong in that expectation, but the direction for Bitcoin is still clearly being indicated by the invisible forces of the market — viz. maintaining the status quo. And maybe, that’s not a bad thing, at least for a while.
I’ve taken a step back and decided to educate myself broadly with all the options for Bitcoin around this debate, and in particular on many of the details which people overlook in cursory conversations. My findings are that this is not an easy situation and will take time to resolve. I spoke with people on all sides of the scaling debate and there are pros and cons, regardless of which path we take, if we even take one at all.
I have been vocal about the fact that I believe that a contentious hard fork which results in a minority chain would be disastrous for Bitcoin. Regardless of the path we choose, we must avoid this at all costs.
Remember, as a community, we are still constantly trying to prove and vindicate ourselves to the world, which largely has no idea about the details of our industry. Bitcoin is seen as the renegade. We’re the firestarters pushing this industry forward. We’re the unproven ones trying to upend everything around us because we believe that Bitcoin can make a difference. But, in the eyes of many, Bitcoin is still associated with Silk Road and other negative connotations coming from within the banking community and broader, and we’re still seeing the implications of that with the current issues of getting fiat in and out of Bitcoin exchanges. This is a long road still.
When things go well for Bitcoin, doubters doubt less but haters still hate more. Just imagine what would happen when things went badly… A contentious hard fork and a branding split/dilution is not an option in my opinion, as a consumer tech guy with experience in branding, PR, marketing, UX and all the other softer issues — trust me when I say that a contentious hard fork should be avoided at all costs.
So what does this all have to do with the title of my post, Satoshi’s Choice?
What would Satoshi do? I didn’t reference Satoshi’s Choice in the title as a reference to the path that Bitcoin should take, but instead the fact that he made a choice. He made the choice to leave the community to our own devices, for better or worse. He made the choice to give us a gift that came with a curse — the more we grew to love Bitcoin, the more that greed reared its ugly head both within our community and the outside world.
We are at a crossroads now, because Satoshi has made the choice to remain silent, in the sense that there is no definitive proof that he/they still exist. Maybe he isn’t alive anymore. Or, maybe he is Craig Wright, or Dorian Nakamoto, or Scronty or Bali Satoshi, etc. Maybe we’ll never know. We do know, however, that we don’t have a Charlie Lee right now.
The big question is: Why do we need a leader if Bitcoin is a decentralized, peer to peer currency? The answer is simple — because it’s not, yet.
For Bitcoin to reach the point where it’s leaderless and immune from manipulation from any one person, party or group of individuals, it truly needs to be decentralized at every layer, and quite frankly, as a community we’ve done a shitty job of doing it. We’ve been so focused on the price, or scaling, or a number of other things that we’ve created a monster in that Bitcoin is probably the least innovative (but, unquestionably, the most secure) of the major cryptocurrencies out there today in terms of what functionality is available right now. Some argue that this immutability gives Bitcoin its strength, and I would agree if it was immutable by distributed choice (i.e. broader decentralized views) — not by default because the decisions are centralized and we’re at an impasse.
It’s clear that we’re not going to have decentralized mining, decentralized exchanges with significant volumes, or even multiple Bitcoin clients with significant share of voice anytime soon. Instead, we have a few exchanges that are at the mercy of the banking system, large mining pools controlled by a few operators, chip manufacturing controlled by two companies and Bitcoin development run by largely one group of individuals (for better or worse). Even Silicon Valley is now facing the challenges that come with monopolization. In a world where capital formation has been decentralized greatly over time, we’re still not making progress in terms of investing in breaking down monopolies within our own ecosystem.
How do we get to a place where true decentralization occurs within the ecosystem, and at a global scale?
In my experience, diversification of people leads to optimal outcomes in business, and life. Diversity is a sign of progress in society. This is why I believe in Bitcoin. However, this is not a technical bug, it’s a social one.
The world I want to live in has a choice of a number of chip manufacturing & mining hardware companies, each competing for the business of thousands of miners and maybe even millions of individuals distributed around the globe. The world I want to live in has a choice of dozens of mining pools, each with their own philosophies on Bitcoin, but all focusing on the long term greater good and can act under their own free will. The world I want to live in has multiple Bitcoin clients all working in unison to improve Bitcoin.
Some clients would be written in C++, some in Javascript, some in Go and others in whatever language people want to use and each team would operate with whatever philosophy they have around software development — the market will choose the best clients and BIPS and they can all compete for market share on a relatively even playing field. People would gravitate to the groups that they felt most welcomed and connected to. Dissenting voices would join other groups and not feel ostracized. Talent would be preserved within our community instead of alienating each other, forcing people to join alternative crypto projects.
And, instead of fighting, each layer of decentralization isn’t trying to fork Bitcoin contentiously — it is trying to make it more accessible to people around the world, more young people in particular from different backgrounds, more women (Bitcoin is pretty male dominated (95%+?), which is clearly to our detriment), more diversity, more opinions and all with the common goal of contributing to the ecosystem and furthering the advancement of the Bitcoin Blockchain for the good of all mankind. This is not the world I live in today. Maybe it will be one day. I look forward to that day.
For now, maybe we can just start the next chapter by treating each other with a bit more respect, irrespective of our views and opinions on Bitcoin.
I’ll start by showing respect for Satoshi’s decision to leave — that was his choice, but what happens next is ours…
