Fundamentalists Pose Bigger Threat to Bitcoin than Anyone Else

A Bitcoin fundamentalist holds extreme views about how Bitcoin should be used and traded in the market
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Dan Held, a Bitcoin veteran, stirred a debate on Twitter when he wrote, “Say no to Bitcoin fundamentalism”. When pressed for more, he loosely explained how Bitcoin fundamentalists have deemed everything, part of the free market, immoral. “Alts are immoral. Lending is immoral. VCs are immoral – Making money is immoral.”

This is the general viewpoint of purists, who believe Bitcoin holds a Godly position, untouched by worldly things. Experts believe it is an extreme position to take in support of technology and likened it to religious extremism. 

Bitcoin fundamentalism explained

In a podcast named Bankless Nation, Held explains the traits of Bitcoin fundamentalists putting it into the context of religions. Religion is the best way to explain the rise of extremism in Bitcoin. According to him, every religion has sub-groups that advocate imposing extreme rules, which are not supported by the main group. 

“The same cultural element has been brought into the Bitcoin community by a few that doesn’t represent the core values of the Bitcoin ethos. For example, claiming that earning interest is usury, is some sort of mediaeval religious response to the interest in which earning interest or earning yield is simply a free market activity,” said Held.

He added that this Bitcoin sub-group calls out certain influencers for making money and building courses. They say that making money from educational activities is some kind of a perversion of this pure ethos of giving out all of your time and effort to help Bitcoin. “If people want to sell a course, they can sell the course. If they want to give away a course, they can give away the course. You’re free to price your services or products at zero but to call out someone, who is making money while doing a fantastic job of educating people about Bitcoin, looks like extremism,” said Held.

Experts, however, explain the reason behind how this sub-group came into existence. 

According to Held, these fundamentalists were once the defenders of the right cause who have now turned inward and are fighting their own community.

“Blockchain is a community and many believe that the community should help each other without having ulterior motives. But, at the same time, there is nothing wrong if someone is charging for making an effort to teach,” said Raj Kapoor, founder, India Blockchain Foundation.

Today’s attackers were once rightful defenders

In 2016-17, a debate over the Bitcoin block-size ensued. This debate caused a major split and created two camps – the ‘Big blocks’ and ‘Small blocks’ camps. The Big blocks segment was led by a Chinese mining giant Roger Ver, an early Bitcoin investor. This camp was concerned about the scalability issue of Bitcoin, which will prevent it from becoming a peer-to-peer payment platform. 

Owing to the long processing times and high fees, people would avoid Bitcoin for day-to-day transactions and instead use it as a store of value – like gold. They suggested increasing the block size. If Bitcoin’s block size is increased to 8 MB, it will increase the number of transactions per second by 8 times. This will eventually reduce network congestion, and in the future, the block size can be increased as much as needed as Bitcoin achieves further adoption.

However, this was opposed by the ‘Small Blocks’ camp. The camp supported keeping the current 1 MB block size and focussed on optimising transaction size and handling, in order to achieve scaling. The solution they proposed was Segregated Witness or Segwit, an upgrade to the Bitcoin protocol that would effectively reduce the transaction size by 75%. This will allow a 1MB Segwit block to hold the same amount of transactions as a 4 MB non-Segwit block. Additionally, Small Blockers spoke about the development of the L2 network solution – a layer 2 or second layer solution on top of the Bitcoin protocol that will allow instant and feeless transactions.

In 2017, the debate reached its climax and in August that year, the Big blocks camp hard forked a new Bitcoin called Bitcoin Cash while Small blocks proponents created Bitcoin Segwit. Initially, it was unclear which Bitcoin would win (Bitcoin Cash or Bitcoin) with a longer blockchain, or ledger of transactions).

This is how it happens – with more miners on board, the computational power increases, which also increases blockchain length and network robustness. Bitcoin Cash favoured support from Bitmain, and as a result, the original Bitcoin’s hashing power was cut nearly in half when the fork occurred.

Eventually, Bitcoin emerged strong even after the fork. This was the time when the community actually fought against the big conglomerates to maintain the decentralisation power of blockchain and save it from outside influence.

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