BTC’s failure is/was the idea that the community matters. “Bitcoin experts” tout on their LinkedIn pages that they have the technical expertise of running a full BTC node and that somehow gives them authority. There is a distinct lack of understanding in the BTC “community” that at its core Bitcoin is an economic system. Miners are the heart of Bitcoin, and their actions pump blood through the life force that is the Bitcoin network. The heart is stable. The heart pumps blood 24 hours a day and never stops. It is reliable. There are times when the heart is tested.

At the root of the BTC philosophy is an adherence to the idea that an economy can be centrally planned. The natural unintended consequences that emerge from economic planning were on full display as BTC fees skyrocketed to $50 per transaction. As we’ve written about extensively, Hayek saw through the central planners for what they are: socialists. This word makes a lot of people uncomfortable. It is used as a pejorative by those in Bitcoin, and many take offense at the notion that they themselves could display any socialist tendencies.

If you do not believe that the capitalist nature of Bitcoin will govern it to long term success, you are the socialist Hayek forewarned. If you believe that a blocksize limit should be enforced by anyone but the miners themselves, you believe that you alone have the wisdom to implement the “right” production quota on workers.

This was ALWAYS the core of the blocksize debate. The technical guts of what is involved will always be a topic of discussion for computer scientists. Regardless, the idea that a central repository and social media could govern how miners acted was nothing but a poison whispered into miners’ heads.

The lie was always that miners weren’t the rulers. For some miners, that curse has been lifted.

To some, the BCH split was only about running a separate repository and lifting the blocksize. In reality, the BCH split was the beginning of the empowerment of miners to become the ventricles they were always meant to be. If you don’t see Bitcoin mining as a Stackelberg Competition , then perhaps you would argue for universal optimization of block propagation for all miners. Increased block propagation for all is a great thing, right? At the root of this argument is again the desire to engage in economic planning. The idea that competition will not provide the greatest outcomes but instead that it must be decided by central planners today for the greater good of tomorrow and imposed on all. Optimized block propagation for all is a great thing. Every individual having healthcare is also a great thing. How do we best achieve these goals?

Through capitalism.

The Satoshi Nakamoto whitepaper was extremely clear that miners “vote with their CPU power, expressing their acceptance of valid blocks by working on extending them and rejecting invalid blocks by refusing to work on them. Any needed rules and incentives can be enforced with this consensus mechanism.” It’s interesting that we, again, have those in the BCH “community” arguing that this isn’t true. The argument usually circles back to the idea that exchanges mean anything to Bitcoin and that the BCH split shows that Satoshi never envisioned chain splits with replay protection.

That may be true. It’s possible that Satoshi never thought miners would allow social consensus to poison the Bitcoin bloodstream. I’m sure he also didn’t envision a future where replay protection and insanely variant and inefficient difficulty adjustments would create perverse incentives where the Nakamoto Consensus experiment would not be allowed to play out (as occurred with BCH/BTC). Regardless, the removal of signature data from the blockchain was avoided and Bitcoin lived on in the form of BCH. It is time for us to finally allow Nakamoto Consensus to work. It is time for the Stackleberg leaders and followers to play the game that Satoshi created for them. If you don’t want to allow that to work, then you are talking about an experiment outside of Bitcoin.

When the Stackelberg game emerges in BCH, it will force the hands of all miners on the BTC network and the BCH network. Want a say? Mine the chain and vote with your CPU power. Bitcoin provides the opportunity to bring free and sound money to the world. That is the goal, and it is the most important goal. Bitcoin (BCH) allows that, but only through the Bitcoin mining process can stable money emerge. There is nothing new in social consensus. There is nothing new in exchanges. These are the shackles of economic planning that Bitcoin frees us from.