Bitcoin Core is the term used to describe the people who work on the development of the main Bitcoin chain. On August 1st, for anyone who is unaware, there was a hard fork that split the Bitcoin chain in two. Bitcoin developers as well as many people in the community had a disagreement about how Bitcoin should scale. People on the Core side were adamant about putting Segwit into effect. According to them, Segwit would be a temporary solution to the clogging of the mempool, and could potentially double the blocksize if implemented. People on the “bigger blocks” or Bitcoin Cash side, wanted the blocksize to incrementally increase in order to be a permanent solution to the ever increasing fees. In this article, I am going to be very opinionated about why I think Bitcoin Core is terrible for the Bitcoin ecosystem, and why I think Segwit is right now, a colossal failure. Remember, if you do not agree with what I am saying, make a proper rebuttal. Expand your horizon about what you are investing in and do not any under circumstances let yourself be caught in an intellectual echo-chamber.
What is my problem with Bitcoin Core?
My biggest issue with Bitcoin Core is the way they seemingly do not have a problem with giant transaction fees . The reasoning for this I will get into later, as they have a fundamentally different belief for what Bitcoin should represent than what it is built to represent. Adamant Core supporters such as Tone Vay or Jimmy Song say that large transaction fees are what the market wants at this moment. As someone who actually uses Bitcoin, I can say I do not want to pay over $20 for a single transaction. Not all Core supporters are completely for high transaction fees, most of them are against them, but another issue I have is how they blame everyone but themselves for the mess Bitcoin is currently in. For example, they often blame, “spam” transactions for the high fees on the network. According to many, a malicious group of people make a ton of very small transactions, which are made to clog the network and to increase fees. I scratch my head wondering why anyone would believe this blatant lie. Why do I think it is a blatant lie? Well for starters, it costs money to make a Bitcoin transaction. This is specifically made to STOP spam and to reward miners. I am going to do a little math on what it would cost per day in order to “spam” the network. As of this moment, there are about 400,000 transactions per day on the Bitcoin Network. If someone wanted to clog the Blocks with 5 cent transactions, it would cost them $20,000 per day. Core supporters claim this happens daily. What organization would spend upwards of $100,000 a week just to congest a network? What gain does it have to them? This is a clear indication of deflection, made to make the community have someone powerful to scapegoat. This is a very common theme with every single argument Bitcoin Core developers make.
Why Segwit is a colossal failure
Many people on August 1st were exited to see the issue of scalability be solved for a temporary amount of time thanks to Segwit. Lower fees lasted for only 13 days until August 14th, where fees exceeded their pre-fork levels. People were scratching their heads, wondering why Segwit barley fixed fees. Core supporters put out misleading graphs after the fork, making Segwit look like it has been activated in all new blocks, when the Y axis only had a 1% maximum value. Developers told us that Segwit is not an instant process, which is true. But more than four months after activation, Segwit adoption still sits at less than 15% and fees as you know, are higher than ever. As people woke up to the fact that Core developers dragged out a two year long debate just to pump out a non-solution, they started to deflect the problems of Bitcoin again. Instead of saying Segwit was a failure, they blame exchanges and even call Bitcoin users lazy, for not moving their coins into Segwit wallets. This is a huge problem for everyone in the crypto community. Why? Because Core devs are telling us to be dependent on third party exchanges to make overall fees lower. This goes 100% against the entire goal of Bitcoin not needing third parties to make fast and cheap transactions. Now that Segwit cannot be over-hyped anymore, people often refute former Core supporters such as myself by saying the Lightning Network will make transactions almost instant and basically free. If the Lightning Network ends up succeeding, it will be great for all Bitcoin users, and the scalability problem might actually be fixed. But as of now, there has not been any official Lightning transactions with anyone besides very experienced developers, and it could take months or even years to see mass use of offchain transactions.
Why the Core mentality is destroying Bitcoin
There is one fundamental difference between the Core and Cash feud and that is the way both sides perceive the goal of Bitcoin. Core supporters say that Bitcoin is created to be purely a store of value, while Cash supporters say Bitcoin was created to be a fast and reliable currency. This is why Core supporters often say high transaction fees are not the biggest issue at the moment, as small purchases should just be left to other coins. In my opinion, Bitcoin should be both a store of value AND a currency. Roger Ver a prominent Bitcoin developer, BCH supporter, and the main scapegoat for everything from high BTC transaction fees to Coinbase insider trading allegations, often cites that in order for an asset to be considered a store of value, it needs to have a secondary use. This is the case with every item that is considered a store of value today. For example;
Gold; Used in jewelry, electronics, dental work, has a physical luster which makes it seem valuable.
Silver; Electronics, silverware, jewelry, decor, and same physical luster
US Dollars; Can be spent, used to pay taxes, used as “legal tender for all debts, public and private”
Real Estate; Can be lived in
If Bitcoin is unusable as a currency due to its fees, what secondary use does it have? Combined with the fact that Bitcoin is extremely speculative, nobody on their right mind would run to Bitcoin during a bad recession. If Bitcoin was a viable currency, it would be a much better version of gold. The smallest physical unit of gold that is practical to use is 1g which is $50-60. This means that gold cannot be spent on smaller items. Bitcoin used to be able to fix this problem. If you had Bitcoin that appreciated over time, you would not have to sell it for USD in order to spend. You could go to the many businesses that have adopted Bitcoin and spend it. Because of this, Bitcoin Cash supporters often will say that BCH is the “real Bitcoin” because the entire goal of Bitcoin according to the original whitepaper is to be used as a currency and BTC cannot fit in that definition. And while I agree that BTC is nothing like it was intended to be, it is still the real Bitcoin. It is connected to the original first block and always will be. Businesses have been doing the opposite of adopting BTC recently. Steam, the popular gaming platform has dropped BTC as a payment option due to high volatility and high fees. BitPay, the popular website used by many small businesses that accept BTC will implement a BCH payment option!
Overall I think the Bitcoin Core community is very toxic and is trying to change Bitcoin in a way that will destroy itself once all the cryptocurrency hype dies off. Instead of flaming my article, make a proper rebuttal and try to change my mind. Unlike many, I do not let myself become entrenched by my own beliefs. If I hear an argument that is solid, and makes sense, I will change my mind in a heartbeat.
Thanks for reading guys! If you liked my article, you can donate Bitcoin Cash, Litecoin, or Ethereum to my wallet addresses. Lets be honest, nobody is going to donate BTC with such high transaction fees so why even ask for it anymore… If you’re broke like me, you can click on my affiliate links to get free Bitcoin and Dogecoin on the fountain website I use. You can also follow me on my official Twitter at “Jackson_Kwiat” where you can see my insight on anything cryptocurrency related.
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