Vitalik Buterin, the co-creator of Ethereum, took apart a Deconomy talk about Bitcoin on Twitter. The talk was titled “Bitcoin, Controversy over Principle”.

Here's what he had to say (for tweets missing from the list see the original thread on Twitter or [here][tw2]).

Blockstream, the company which patented some Bitcoin technologies and is now pushing the Lightning Network as a solution to Bitcoin's scaling problem has accepted that Bitcoin is no longer the only blockchain which makes sense (i.e. the maximalist's view). Vitalik says that in the talk, they seem to have realized that the future will be built on co-existence and collaboration of multiple blockchains.

The following two tweets focus on his discarding of the speakers' claims about the history of money. They say that the history always went from collectibles, to store of value, to medium of exchange, to unit of account. Vitalik claims this is incorrect and cites the book Debt as a good source of accurate information on the topic.

We've written about the false finiteness of Bitcoin before, and we've also covered the ability of miners to simply change the total supply of bitcoin and their emission and other properties in this post, so we don't agree with any claims about that.

Vitalik furthermore claims that Bitcoin is a better store of value than gold, which we can only partially agree with. In regards to mining, sure, gold is much worse than Bitcoin right now. But as a store of value, gold will persist in an offline world and there's no way for a company like Blockstream to declare it worthless. Bitcoin has been empirically proven to have been sabotaged internally and has been functionally useless since RBF (replace by fee) has been implemented, which alienates merchants.

We have to keep in mind that when the global economy collapses, both will be worthless. As far as current store of value is concerned, gold has still proven to be a better choice if we consider the people who were remortgaging their houses to buy Bitcoin when it was at $19000.

It's only logical of Vitalik to wonder why transferring $400m should be touted as an advantage of BTC. We agree with this completely. Those with 400 million to transfer will always find a way, but those who need to send smaller amounts, the unbanked billions, are the people who will most benefit from a decentralized and usable financial system.

Next, Vitalik expresses his opinion that Bitcoin is not divisible or spendable on goods in amounts under 10k satoshi – he believes it's impossible to spend less because of transaction costs and that even if the broken Lightning Network is used. The LN will be explained in an in-depth post soon, but the gist of it is that you need to pen a “channel” with a central bitcoin bank which forwards the money along a route, like in a traditional banking system. This would speed up and cheapen transactions at the cost of privacy.

The following tweets weren't as important, until Roger Ver, Bitcoin Cash's advocate, took the stage.

In this, Roger showed how much Hong Kong grew compared to Havana, stating that economic freedom is responsible for such progress. Vitalik was quick to recognize the importance of economic freedom, but also jumped on the fact that correlation does not equal causation – Shenzen (mainland China) grew just as much as HK but is far less economically free.

Roger spent the rest of his talk throwing dirt at small-blockers (the people behind the original Bitcoin chain which kept the block limit small), but didn't give concrete arguments – something that bothered Vitalik, him being technical and highly mathematical. But Vitalik does agree with the notion of small blocks harming privacy – tumblers are services which mix up bitcoins in one pool and send them out in different ratios to different addresses to mask their origins. With expensive transactions, it's only natural for them to suffer.

Craig Wright took to the stage afterwards. Craig claimed to be Satoshi Nakamoto on several occasions, but has failed to prove it. Vitalik didn't hold back in denouncing all of Craig's claims and calling him a crazy bullshitter.

…

After having taken Craig's arguments apart in a superficial but aggressive way (we hope to see a more thorough takedown on Vitalik's blog soon), a panel between Jeff Paik, the founder of Finector, Roger Ver, and Samson Mow, the CSO of Blockstream begins.

This is a really important tweet. It's easier to move to an altcoin than to use the Lightning Network if Bitcoin's original approach is no longer working for you. To use the LN, one needs to open a channel and send money into it. To take some money out, the channel needs to be closed. Both opening and closing a channel requires a transaction, and transactions currently take at least 10 minutes to confirm and that's only if the service you're connecting to is happy with a single confirmation. Most require 6 which is an hour of waiting on each end. It's easier to use services like Coinvendor.io or Shapeshift to exchange to an altcoin and then go to Bitcoin or fiat as needed.

We agree with Vitalik in that we'd simply go to another restaurant if we ran into a full one. Small blocks really do hinder adoption.

This is a surprising one – Vitalik suggests adopting Ethereum's mining schedule of 15 seconds per block with the GHOST protocol, which basically amounts to having Uncle rewards. What this means is that when two valid blocks are mined but one is included in the blockchain before the other, the miner that mined the other block will still get a block reward, just not as big as the main reward. This consolation prize keeps simultaneous mining of valid blocks non-wasteful and fair.

Surprising no-one, Vitalik again confirms his stance that Blockstream hijacked Bitcoin's original direction with their questionable engineering practices and censorship on Reddit and other platforms. The Lightning Network in its current state requires a fundamentally broken original Bitcoin, otherwise no one would use the LN. At the same time, Vitalik points out the lunacy of infighting and this Bitcoin / Bitcoin Cash holy war. Each chain is its own and each is growing in its own direction – the problem is the brand name. Both Bitcoins want the throne so it's their “duty” to accuse the other of fraud.

Signing out, Vitalik confirmed once more that Craig Wright is insane.

RELATED ARTICLESMORE FROM AUTHOR

LEAVE A REPLY

Please enter your comment!
Please enter your name here