Just by reading the top two points:<p>1. Some of them show very poor communication skills or a lack of maturity — this has hurt bitcoin’s ability to bring new protocol developers into the space.<p>2. They prefer ‘perfect’ solutions to ‘good enough’. And if no perfect solution exists they seem ok with inaction, even if that puts bitcoin at risk.<p>I get this bad feeling that someone (author of the article) is planning a takeover and for all the wrong reasons. I've seen this "yeah they are smart guys, but they are introverts and our business needs to be extravert and agile and adaptive and fast moving and all other buzz words", then you introduce some of thous extrovert super agile people who just want to "bang out a solution, since any change is better than no change". Next thing you notice is that the old core team members are leaving after their protests about future of the product fell on deaf ears and these new guys are just pushing their own agenda/vision. Fast forward few years and just 1-2 or most likely none of the original team members are there anymore and cracks start to appear and these cracks are because the "better than nothing" solutions back in the day are found after all flawed, but now you have a lot of work build on top of rotten foundation and since your team now consists only of short sighted: "just fix it" people they are going to try to fix the problem at the top instead of at it's core "because we can't hold bringing in new features".
The problem Bitcoin is facing is not so much the technical question of what blocksize would be best. It's a war about who is in the drivers seat. The current developers of Core want to turn Bitcoin into what they call a "settlement layer" and end its original function as a payment system. Then they want to build new services on top of this "settlement layer". Most (all?) of them are organized in a company called "Blockstream" that received $73 millions in funding to build these new layers. This turns away the original crowd of hackers who liked Bitcoin in the early days. The hackers and users want to keep the original vision of a "Peer-to-Peer Electronic Cash System" as outlined in the original Bitcoin Paper:<p><a href="https://bitcoin.org/bitcoin.pdf" rel="nofollow">https://bitcoin.org/bitcoin.pdf</a><p>Also check the discussion about this on reddit:<p><a href="https://www.reddit.com/r/technology/comments/48zggz/a_behind_the_scenes_look_at_how_bitcoin_core/" rel="nofollow">https://www.reddit.com/r/technology/comments/48zggz/a_behind...</a>
Miners make money principally through seignorage, but will eventually have to replace it with transaction fees, as Bitcoin is designed to throttle seigniorage down over time and does so in an abrupt, stairstep fashion (50% at a go).<p>Core (a group of people who presently control the code of the only software that matters on the Bitcoin network) has an argument for miners which goes like this: "We believe the space on the blockchain should be scarce. If space is scarce, people will a) conduct transactions offchain, which is conducive to our interests and b) bid up the price of onchain transactions, which is conducive to your interests. You'll shortly receive a counterproposal from another development group which wants space on the blockchain to be abundant. In this case, the price of transactions will go back to ~0 and, with it, your revenue. Make the right choice."<p>The "economic majority" [+] of Bitcoin has an argument for miners which goes like this: "You presently have been given, literally, a license to make money -- substantial CapEx and OpEx, granted, but making money is what you do every day. If you attempt to make the Bitcoin network unreliable to increase fees generated by it, the tokens you are creating daily become not-money. You should prefer your license to make money to the planned future license to make not-money."<p>The economic majority is hoping that miners are long-term thinking entrepreneurs and not, to pick an example totally randomly, slash-and-grab operators taking advantage of a ponzi scheme.<p>[+] Jargon from the Bitcoin community. The Bitcoin "protocol" allows miners to essentially vote with hashpower. The "economic majority" phrasing is an attempt to recenter the notion of votes away from hashpower, by saying that exchanges/retailers/customers/etc are substantial stakeholders in the network even if they do not control a meaningful number of ASICs. In practice, the economic majority is Coinbase, Bitpay, and "the loosely affiliated ecosystem which turns cash to Bitcoins to drugs to Bitcoins to cash."
For those not following the drama, there has been an organized attempt for the last 6+ months to take over Bitcoin.<p>A fake "grass roots" campaign was started on Reddit, where numerous sock puppet accounts were used to bombard the /r/bitcoin subreddit with calls to change Bitcoin's "block size limit" to a much larger number.<p>This would allow more transactions per second, at the cost of hurting Bitcoin's P2P decentralization (the main thing it is good at). These posters claimed there was a dire, urgent need to do this immediately, and used spam transaction attacks on the network to make it look necessary.<p>They also used downvoting/upvoting scripts to push their posts to the top, and to censor the developer's
responses (reddit hides posts with a -5 score; any post by developers instantly would be downvoted to that level).<p>They harassed the developers with constant personal attacks, to the point that it became impossible for them
to engage the community. They also flooded the development mailing list, and many developers unsubscribed.<p>As for the "block size increase", an absurd number was picked (20x increase), and knowing that the developers would not go along with it, the "solution" proposed was a fork of the both the software and the network itself called "Bitcoin XT".<p>All but 2 of the 90+ Bitcoin developers thought this was a terrible idea, especially since they have
come up with much safer and better solutions to achieve the same goal (scaling up the transactions per second).<p>Yet when this fork attempt failed to gain any support, a better funded, even more aggressive second attempt (oddly named "Bitcoin Classic") started being promoted.<p>It is being pushed by the CEO of Coinbase (the author of this blog post) and backed by some of the other bitcoin exchange's CEOs.<p>I think the creator of bittorrent, Bram Cohen, sums up what developers and the larger technical
community are thinking about these takeover attempts- <a href="https://twitter.com/bramcohen/status/697705876337995776" rel="nofollow">https://twitter.com/bramcohen/status/697705876337995776</a>
"Some of them show very poor communication skills or a lack of maturity — this has hurt bitcoin’s ability to bring new protocol developers into the space."<p>"Being high IQ is not enough for a team to succeed. You need to make reasonable trade offs, collaborate, be welcoming, communicate, and be easy to work with."<p>The assumption slipped in here is that the writer is, in fact, reasonable with good communication skills - and that those he is addressing are not. He evades evenhandedly discussing their concerns with his proposal or their proposed solution. That's a mark of trickery, not good, honest communication.<p>I don't know about the team in question, and I don't know who's right on this issue, but I am considering leaving Coinbase after reading this article.
Reading these things I see two dangers in crypto-currencies. 1) it's difficult to know all of the technical nuance that can have significant impact on value. I bet many merchants and bitcoin holders had no idea of any of this was in the offing. Even with research, non-technical people may not have been able to appreciate the risks from specs and tech discussions. And 2) this really doesn't feel decentralized. Sure there may be no formal organization, but with apparently so few people being able to be closely involved, in almost may as well be.<p>Of course, I'm a more casual observer on the sidelines, and maybe my take is wrong as others with closer observations may tell me. But I never heard some of these things being issues until just now... bitcoin is clearly not for casual users.
It seems that these problems fundamentally boil down to there being a very small number of people (the five Bitcoin Core developers) who control the destiny of Bitcoin, and who don't represent users of the currency at large.<p>For a currency which purports to be open, transparent, and free from institutional control, this seems like a huge deficiency. Consider that the Federal Reserve's Board of Governors has seven members, all of whom possess decades of experience in fiscal policy, are nominated by the President, and are confirmed by the Senate. These are experts in the field who are selected by a nominally democratic process.<p>And Bitcoin wants to replace this with five random devs that most of us have never heard of?<p>I'm hardly a fan of the Federal Reserve or the US monetary system. But how exactly is Bitcoin offering a more transparent, open, and democratic currency when it can be hijacked by five people?
> It is difficult enough to get two people to agree. Three is harder, and four is even harder. Once a community gets to fifty or hundreds of people, getting everyone to agree is an irrational goal. But this is ok. Mechanisms exist to resolve disagreement amongst large groups of people (like voting). Waiting for everyone to agree is the same as saying that nothing will be done.<p>It's almost like we need some sort of mechanism or formal protocol for reaching consensus among a group of geographically distributed people. A kind of.. distributed consensus protocol.
Some other takes on Bitcoin Core:<p>* Double billing is not healthy competition
<a href="https://medium.com/@bramcohen/double-billing-is-not-healthy-competition-b698c345b11e" rel="nofollow">https://medium.com/@bramcohen/double-billing-is-not-healthy-...</a><p>* Lesser known reasons to keep blocks small in the words of Bitcoin Core developers
<a href="https://medium.com/@elliotolds/lesser-known-reasons-to-keep-blocks-small-in-the-words-of-bitcoin-core-developers-44861968185e" rel="nofollow">https://medium.com/@elliotolds/lesser-known-reasons-to-keep-...</a><p>* The state of the Bitcoin union is strong
<a href="https://medium.com/@muneeb/the-state-of-the-bitcoin-union-is-strong-3ca9a5f24a7" rel="nofollow">https://medium.com/@muneeb/the-state-of-the-bitcoin-union-is...</a>
Why should I trust what this guy is saying when he has such egregious misunderstandings about Bitcoin? I expected better from the CEO of Coinbase. The worst one was this:<p>> The next block reward halving is coming up in July. Let’s say that miners on average are able to mine a coin for $250 (I don’t know the exact number, so this is a guess). After the halving in July their cost to mine a coin will double to $500. If the bitcoin price stays around $425, it will be unprofitable for a number of miners to continue mining.<p>You can't just guess about these things! You have to do the math! There are two components to mining costs: The sunk costs (the actual price of the mining equipment), and the oncoming costs (electricity). Once you've already paid the sunk costs, and the miners have, tautologically so, to get to the current network hashrate, you won't turn your miners off unless their yield falls below the cost of electricity.<p>I've done some calculations and, with the current most-efficient generation of ASIC Bitcoin miners, you generate around $0.25 per kWh. So with the halvening, you'll be generating around $0.12 per kWh. But guess what most miners are currently paying for electricity? Around $0.02 per kWh (yes, they're locating their mining operations like Google locates data centers). So while some inefficient miners on the fringes may turn on, the halvening isn't going to come close to causing the majority of miners to become unprofitable. So you're unlikely to see a big drop in hashrate.<p>The most ridiculous part of the catastrophist argument is that we <i>already</i> had a halvening from 50 BTC to 25 BTC, and nothing changed! The hashrate didn't go down appreciably and block finding time didn't suddenly jump up. There was nothing different about that time than now; both are governed by the simple economics of mining profitability, which tends to stay at around the same level above cost -- that is to say there are economic self-balancing forces at work that cause miners to enter/leave the system to keep the hashrate adjusted relative to the mining returns over the long term.<p>So anyone proposing a catastrophe over this halvening has an uphill battle to climb of explaining why it's different than the last one when nothing happened, and that hasn't been done so far.
As an outside perspective, the Bitcoin community is one of the most mysterious clusterfucks I've ever seen. Every time I visit the Bitcoin subreddit or any discussion here that has anything to do with Bitcoin it's all arguing over Core vs the world or "we should be using this not that!" The thing that stops me from getting into Bitcoin is the Bitcoin community itself.
The "Genesis" BTC blockchain seems to have its fate sealed.<p>Elements of a genius ponzi scheme mixed with psychology of the limited edition beanie baby craze and enough allure of "technology is magic" created a "valuable" cyber diamond to send hordes of processing power to "mine" and sell off like hot potato stocks.<p>As we begin seeing more viable altcoin systems with practical improvements, "investors" and processing power will jump ship to the improved cryptocoin protocols. Bitcoin and the bandwaggon of investing in a BTC as a currency which inherently encourages not spending that currency (deflation as a fundamental design) is such a paradoxical mind fuck it's one of the most brilliant pieces of art I could imagine.<p>Inflation is incredibly healthy for an economy because it creates an incentive to invest money into new businesses and real goods and services instead of being buried outside of the system where it does no good. The trick is to prevent hyper inflation - and in BTC or other arbitrarily produced currency systems, there should be mechanisms in place to avoid the abuse of the fabrication of the money tokens.
Serious question; where does all the money come from to run these operations (eg. the miners)?<p>I mean I haven't seen any legitimate use of bitcoin advertised for consumers. So who is using bitcoins for transactions?<p>Is this like with torrenting where people keep telling "there are legitimate uses for it like downloading linux iso:s" but in reality 99% of the traffic is illegal.<p>I'm thinking that bitcoin is used mainly for money transfer for illegal stuff (drugs etc.), because I haven't read or heard about any legitimate large scale use of it (exept maybe speculation, so does the money for this come from somekind of ponzi scheme then? Or maybe investors really believe that some day this will be a large legal enterprise?)
Interesting article. I am not a bitcoin user for a reason that the article seemingly underscores: Bitcoin lacks stability. This makes me sad, because I would very much like bitcoin to succeed.<p>The more I look into it (and I may not be looking at it clearly), the more bitcoin seems like a digitized version of what we currently have in MeatSpace: An unbacked inflationary currency.<p>I think worrying about scaling in mining activity is a problem in search of an audience.<p>If miners hit the wall, and are not able to put more coins into circulation, there is an opportunity to stabilize coin value by having demand tempered by supply. Also, with bitcoin (or any other digital currency) there is the capacity for psuedo-infinite fractionalization of coins.
> There are probably a couple dozen qualified computer scientists working on crypto currency research right now, but there are at least tens of thousands of qualified software engineers in the world who are capable of building bitcoin protocol software.<p>Maybe, but the problem is defining the protocol, not building the client.
The continued censorship on the main bitcoin subreddit and the main bitcoin forum is ridiculous. It makes the whole bitcoin community and ecosystem look like a joke, which isn't something anyone involved should want. If the currency can't handle an open debate between adults, how do they expect to weather attacks from serious bad actors (criminal, state, or otherwise)?<p>This article is pretty detailed and does a good job of depicting the events of the roundtable - but as someone who didn't attend, I'd be curious to see how a Bitcoin Core member would choose to describe things. I imagine their perspective would be very different. On the other hand, the history of this whole controversy seems to suggest that the Core crew are as bad at communication as Mr. Armstrong suggests, so I doubt we'll ever see that alternate perspective :(<p>The risk of miners dropping out en masse once the difficulty goes up isn't something I've seen mentioned before, and it seems pretty scary. I would have assumed that difficulty adjustment would happen more often, so if it continues to have such a long interval, that seems like a threat to the long-term health of the currency. I can imagine some other event knocking miners out of the network, like a sudden spike in the cost of electricity for large mining operations - so even if the immediate risk is addressed it seems like this is still a threat going forward.<p>Ultimately, it's really sad that what seems to have happened with Bitcoin is that Satoshi put together some really stellar technology and <i>completely</i> overlooked the human component. Handing the project off to a random group of contributors seems reckless under any circumstances, and then it turned out that the random group of maintainers got along poorly. Now the de-facto control of the currency is in the hands of a small group of people with an obvious profit motive, because they have control over the central bitcoin forum and central subreddit. Hindsight is powerful, but it feels like it should have been obvious that the human risks needed to be addressed if Satoshi was serious about constructing a new currency.
Posted 4 hours before this one, here: <a href="https://news.ycombinator.com/item?id=11227598" rel="nofollow">https://news.ycombinator.com/item?id=11227598</a><p>Wondering why one didn't pick any interest, and the other picked 160+ comments.
Also, see this:<p><a href="https://medium.com/@octskyward/the-resolution-of-the-bitcoin-experiment-dabb30201f7" rel="nofollow">https://medium.com/@octskyward/the-resolution-of-the-bitcoin...</a>
Imagine the internet had been developed by guys like this one. Pushing a agenda instead of looking for best possible solutions. The internet would like teletext/BTX and cost at least an 1$ per hour.