The roadmap that Blockstream has followed as a company is an incredibly strange one. One might think, after taking brief look at them, that they’re one of the most important entities in the cryptocurrency community. This being because many of their employees are contributors to the development of Bitcoin Core. However upon closer inspection of what Blockstream does, it’s impossible not to radically reconsider the original assessment. Instead of pursuing on-chain developments and fostering adoption among the unawakened populace of this planet, things which are beneficial to the entire Bitcoin community, they have chosen instead to derail the electronic cash project and lead it down a path of destruction.

With a foreboding sense of comedic tragedy, Blockstream has announced the release of its first viable product available to the public: Liquid Network. Despite first announcing Liquid in 2015, Blockstream still failed at securing the liquid.com domain. They were beaten by Quoine, who is directly competing against Blockstream and who launched their product last month. Functioning as a “federated side chain”, this secondary tech built ontop of the Bitcoin blockchain will let authorized users transact in Bitcoin with near instant transaction speeds and confirmations. Well not actually Bitcoin, but a new token class L-BTC. Yup, you heard that right. This “liquid” network actually uses a stand-in currency amongst a group of permissioned nodes for representing Bitcoins on the side chain. At this stage, one might be thinking, “Hold on just one damn minute! Authorized users? Permissioned nodes? Issued tokens? That doesn’t sound like Bitcoin at all!” We would have to agree with this thought that indeed, this product is not Bitcoin at all. As we have seen and heard more and more about this new “production Bitcoin sidechain”, it turns out to be nothing more than a proprietary, glorified and non-capped version of the Lightning Network.

While the Lightning Network itself has been a disappointing failure, let’s take a closer look at the three adjectives used above to describe Blockstream’s new product. The word “proprietary” is raised here because, as it turns out, the only nodes that will be operating the Liquid Network will be run by none other than Blockstream itself. Following the completed build of the network, they will begin collecting operating payments from their users. The use of “glorified” comes up in relation to the blaring fanfare being given to this launch announcement. Even though the tech is still very much in it’s beta stages of development, Blockstream is heralding it as the answer to all of Bitcoin’s problems. Problems (such as horrendously slow transactions and insanely high transaction fees), that Blockstream once seemed all too keen to disregard or outright dismiss as being “inconsequential”. This brings us to the third and perhaps most telling descriptor of this new sidechain: non-capped. Currently the Lightning Network has a capped limit upon transactions, which is to say that the total amount of money that can be transacted is hard limited by a cap. Even more than it’s progenitor 2nd layer blockchain app, the new Liquid Network is centralized to such a degree that transacting with higher amounts of money is enabled without worrying about a maximum cap.

So in a nutshell, the “token” of the Liquid Network L-BTC could be classified as a rework of Ripple (XRP) as it mirrors almost every aspect of it. Centralized to a fault, designed for near-instant transactions, and being marketed to enterprise level customers that have enough money in their coffers to pay any amount of (as of yet) undefined fees.

Maybe we are being too naive and this was the plan of Blockstream all along. By eliminating even the potential for on-chain development and innovation, Blockstream forced development off-chain and began pumping resources into things like Lightning Network and Segwit to further cripple Bitcoin’s first mover advantage. Now, with the calls for an exodus of transactions away from the original blockchain and onto tightly controlled 2nd layer options, Bitcoins would give way to Lightning and Liquid tokens. With the abandonment of the baselayer, both the underlying value of Bitcoin and the transaction fees for it’s usage would dry up. Pair this with the coinbase reward eventually running out over time and you get a recipe for the destruction of the incentives that make Bitcoin functional in the first place. Should miners find that they are not getting sufficient benefits for their efforts in maintaining the network, why on earth would they continue to do so? If Blockstream’s actual secret intentions have in fact been to cripple Bitcoin to the point of rendering it obsolete and desiccated, this shit-token centralized mess of a 2nd layer solution seems to be right in line with that thought.