News has just broken that the Segwit2X fork of mid-November is being called off by the leaders of the NYA. This is wonderful! As I wrote a month ago, no one really wanted a fork, but our inability to agree on a path forward was leading Bitcoin directly toward one. The NYA was intended to bring the community together by compromising, but it was a flawed effort that failed to do this. I am glad that the leaders of the NYA have realized this and have given in for the sake of Bitcoin.

It is certainly not news to anyone active in the Bitcoin space that we have had a civil war going for several years. Former heroes have become villains, tribes have formed and retreated into their bubbles, and we are seeing the kind of extreme polarization that characterizes the political situation between the Republicans and the Democrats. We had a real war going on between the two sides and two approaches, and like every war, it became very ugly.

Segwit2X was taking Bitcoin toward a very ugly split

Now that the 2X side has “surrendered” in this war, and the NO2X side has “won,” I hope the Bitcoin community will take this as a chance to put all the ugliness behind and have a fresh start.

Yes, many NO2Xers believe the NYA was a malicious attack on Bitcoin. If it had been pushed through without considering the consequences, I might have to agree. But I am willing to believe the NYA signers had good intentions but the wrong approach, and have finally come to admit this. Why not give them the benefit of the doubt? At the very least, put them “on probation” instead of continuing to attack and punish them. I believe the message was communicated loud and clear, and we don’t need to rub it in any further.

Generational Dynamics (a very fascinating theory that will give you a much better understanding of world history) shows how the first actions of the victors after the victory will set the tone for relations between two sides for the next few generations. If the victors are magnanimous, the defeated build up a reserve of good will toward them. War is ugly, and they have lost much, but they become willing to forgive and forget, moving forward, if the victors show them good will. They may even become close allies, as Japan has become for the United States after WWII.

In contrast, if the victors are vindictive, punitive, arrogant, and rub salt in the defeated side’s wounds, resentment builds up instead that can last for generations and lead to the next major generational war, as we have seen with so many wars between civilizations over the millenia. (Generational Dynamics background on this here.)

The period of time just after a victory is a critical tipping point for this interaction. The first few actions determine the tone of the next few actions, and the effect can snowball. The Pólya urn model explains how this happens. Suppose you start out with an urn, containing one red ball and one green ball. At every turn, you take out one ball, and put in two balls of the same color. At first, the chance is 50% for either color. Suppose red is taken first, and two red balls are returned to the urn. Now, the chance is 67% that red will be drawn next. The model tends to polarize toward having almost all red balls or almost all green balls, based on just the first few moves.

When a war is won, both sides often feel a sense of relief that at least it’s over, even the losing side. This gives an opportunity to reset the relations, to start with a relatively empty urn, so to speak.

So, to both sides but especially to the NO2X side, your moves over the next few days and weeks will set the tone to either continue this ugly war, or to resolve it and have the best chance to bring the community back together to fight the real war: bringing Bitcoin to the world.

“Be magnanimous in victory, and gracious in defeat.”

(Source of quote unknown; variations of this quote are attributed to multiple famous people.)