the wake of the Bitcoin civil war, three competing versions of Bitcoin have emerged (BTC, BCH and Bitcoin SV), but so too have about 3,000 other “cryptocurrency” projects and tokens masquerading as legitimate businesses—until the almost guaranteed exit scam. The main benefactor of the Bitcoin civil war has been Ethereum: a global state machine that allows easy deployment of tokens and smart contracts, but the Ethereum protocol cannot scale, and of the thousands of projects launched, only a handful could even conceivably be touted as having the ingredients necessary to ever become legitimate businesses. The rest are Ponzi schemes or illegal securities offerings—enriching developers and scamming amateur investors.
It is against this backdrop that BTC and BCH advocates, Ethereum spokesmouths and altcoiners of all stripes align to attack the Bitcoin protocol preserved only by the BSV network without ceasing. An industry made up almost entirely of criminals, frauds and scammers have united against BSV citing (of all things) purported fraud and the alleged scam that is BSV’s very existence.
We must ask ourselves why this is?
What is the key differentiator of BSV?
Why have all the thugs and thieves united?
It is my firm belief that among the engaged, the motivation is fear of BSV’s singular ability to absorb the global economy and all of the other “crypto” projects that come with that. For the unengaged, or those who don’t understand the power of Bitcoin, they are swept up in a culture war that they do not understand. It is crucial to understand the powers at play and their implications to Bitcoin and the global economy.
A brief history
Bitcoin was launched with a white paper on the Cryptography Mailing List in 2008. The pseudonym “Satoshi Nakamoto” declared a solution to the double spending problem. The double spending problem of all previous electronic cash systems was the singular limiting factor to adoption of a functional electronic cash. It was impossible to prove exactly who owned what units of money on their distributed ledgers, so systems couldn’t be trusted, and they would wither and die. Bitcoin solved this problem with a concept called “proof of work” which burned computational power to solve arbitrary puzzles in order to account for the state of the ledger in such a way that costs money, so that there is an economic incentive to keep an honest account for everyone’s holdings. This process is often called “mining” because the honest nodes who maintain the honest state of the ledger are rewarded for their work with Bitcoins every ten minutes—similar to how a gold miner is rewarded with gold in exchange for their work.
Since Bitcoin had no value when it launched, it was extremely easy to mine, and also free to send tons of transactions. In theory, this was a Denial of Service (DoS) Attack vector. A DoS or DDoS attack is when nodes get flooded with more data than they can handle and they crash. On a young Bitcoin network, a crash like this would have been deemed a failure of the network, so a cap of 1mb of data for every ten minutes of transaction time was hard coded into the software—planting the first seed of the Bitcoin civil war. From 2009 until 2017, that 1MB limit on total transactions was the single most contentious technical aspect of bitcoin.
Why does it matter?
A single, simple Bitcoin transaction is relatively small from a data standpoint, so 1MB every ten minutes (or 6MB per hour) shakes out to about seven transactions per second before the network becomes overly congested. Satoshi Nakamoto advocated for Visa level transactions, and his direct successor as lead developer on the project, Gavin Andresen, did too! Some of the earliest influential Bitcoiners like Mike Hearn and Jeff Garzik also advocated for more data per block to allow Bitcoin to scale up to remain a simple electronic cash system. They were “big blockers” in contrast to the “small blockers” who advocated for a permanence to Bitcoin’s 1MB limitation.
Small blockers believe that Bitcoin is not a payment network, but rather that it is more akin to a decentralized Swiss bank designed to store Bitcoins that never move: a sort of digital gold vault. They wanted the 1MB block size limit to remain permanent under the auspices of every person running a governing “full node” without having to pay for too much hard drive space. This would mean that at times of congestion, transaction fees would become absurdly high, but that would not matter because bitcoin should not be transacted except in large denominations or in big batches anyways. The other problem is that if it is cheap to join Bitcoin’s governance, then the network is easy to sybil attack, and I would argue that BTC is governed by sybils to this day.
Big blockers believe that everyone on earth should be able to transact and conduct business with bitcoin.
Small blockers believe that everyone should be able to account for the ledger at home, but only certain people should be able to transact.
After years of bickering, in 2017, Bitcoin split into two separate chains, and in 2018, it split again.
What’s the difference
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