Bitcoin BTC has been co-opted

In the early days, bitcoin was used by a niche group of people who wanted freedom. The potential of bitcoin to help free society from the central banking system is why it became interesting and valuable in the first place.

These bitcoin pioneers saw that the main advantage of bitcoin, as a tool for freedom, is that it is *uncensorable*. As long as you have your private key and an internet connection, you can make a bitcoin transaction. No government or bank can stop you.

All transactions were also fast, reliable, and free. You didn’t have to pay a fee to get your transaction picked up by the validators, because there was always plenty of space within the blocks, so there was no competition to get your transaction picked up.

Then the “blocksize limit debate” took place, starting around 2013 and coming to a head in 2017. It’s really important to understand this debate to see how bitcoin was transformed from a tool for freedom into… something else.

The debate was about what to do now that bitcoin was becoming more popular, and the blocks were getting fuller, nearing the blocksize limit. With full blocks, you have high fees, because you have to compete to get your transaction into them, and the system becomes slow and unreliable

On one side of the debate were those who supported the obvious answer: increase the size of the blocks, so that transactions could continue to be fast, reliable, and cheap; these were the big-blockers. On the other side were those who wanted to keep the blocksize limit the same, deliberately crippling bitcoin, because they considered high fees to be good (they were quite open about this); these were the small-blockers.

In a situation like this, where there is no consensus between miners about what rules to follow, a chainsplit occurs. This happened in 2017. Where there was one bitcoin network before, now there were two. Anyone who owned bitcoins before the split now owned bitcoins on two separate blockchains. The majority of miners wanted small blocks and high fees, unsurprisingly since miners are the ones who collect the fees. So their blockchain retained the name bitcoin and the BTC ticker. The minority blockchain was rebranded as bitcoin cash with the BCH ticker, and immediately increased the blocksize limit to keep transactions cheap.

In my opinion, we are looking at a case of problem-reaction-solution here. The small-blockers broke bitcoin, caused fees to become huge, so they could sell their solution. The small-blockers intend to create a “second layer” on top of bitcoin, which amounts to constructing a banking system on top of bitcoin, and forcing all transactions to use that system. Who could be behind that, I wonder?

Bitcoin cash BCH became the tool for freedom that bitcoin originally represented. Bitcoin BTC must now be considered a coin that has been co-opted by the establishment.