I think it is indisputable that the bitcoin community is more divided than ever and that this seems to be caused by differences in opinion about how the future path of Bitcoin should be. I think this is a shame because apparently we all share the same common goal that is the shift of powers away from centralized institutions to a more decentralized, more self organized community.

So while we have this common greater goal we seem to be in disagreement on how to achieve it, or to put it differently we seem to be in disagreement on what could prevent us from achieving it. In other words, what divides us is what we fear most.

The two main things we fear are:

Mining centralization

Too slow adoption / No mass adoption at all / Irrelevance of Bitcoin

The “small blocks”-side seems to be more concerned about the centralization aspect that bigger blocks would bring. Assuming that blocksizes are pushed to an extreme their fear is a Bitcoin which everyone uses but that is centrally controlled and thereby not less censorship resistant than Paypal. Because of that it is “wrong” to accept a reality in which only big data centers are mining and validating transactions.

The “bigger blocks”-side somehow seems to be less concerned about centralization but more about too slow adoption. So is the “bigger blocks”-side just greedy and careless? I would like to make a case for this side of the debate.

About scarcity and certainty - why a strong Bitcoin matters

One of Bitcoin’s big selling arguments is its fixed supply limited to 21 million bitcoins eventually. Together with its good transportability this makes Bitcoin a great store of value and provides a great deal of certainty for people who are willing to use it as such. Especially compared to the uncertainty our fiat world provides this is a huge argument for new people to enter the decentralized sphere of crypto currencies. A switch of the broad community to an alternative primary store of value coin would effectively weaken the argument to store value in crypto since there would be more than 21 million coins to seriously consider.

Bitcoin with its first mover advantage and — compared to other altcoins — deep marked penetration is in the unique position to bundle a huge deal of certainty if it’s not getting too far behind in terms of usability. In the end it will not matter which crypto currency we use but for now it matters because we shouldn’t see the victory of crypto currencies for granted. For most people the ideological superiority of crypto currencies is not convincing enough to prefer them to an enhanced credit card 2.0 service. A strong store of value coin is good for the whole ecosystem and the contest among crypto and establishment is taking place right now.

Bitcoin will never be like Paypal

What we have to realize is that we’re entering a new era. An era in which we can chose which money we want to use to transact and store value. An era in which we’re not forced to use a certain type of fiat based on our place of residence. This freedom of money brings some nice benefits as some key problems within our society such as the extremely uneven distribution of wealth are based on big parts of the population being forced to use a certain kind of money to transact and store value. The ease of exchanging one crypto currency for another we are already seeing right now decouples the ability of money to transact and store value and thereby gives each individual a choice. This will for example prevent one (rational) person to acquire 99% of all bitcoins because the other 99.999999% of the population could then simply not care about bitcoins anymore. It also gives the users of crypto currencies a voice against censorship. It’s a common misconception that bitcoin miners are not invested in Bitcoin because they can immediately sell what they earn. This is not true because they are invested due to the ASIC hardware they possess that ties them to a specific PoW. Miners censoring transactions would thereby destroy the value of their own investments because users not agreeing with these actions would drain value out and shift it into the altcoin of their choice.

It’s a typical trait of engineers to only accept the ideal solution for a problem but in reality we sometimes all have to make compromises.