After listening to Steve Patterson talk about the blockchain war and Roger Ver’s Book, Hijacking Bitcoin on the Bob Murphy Show I thought I would share my initial thoughts. Bob says he is going to have Stephan Livera on to offer the other side. That one should be good.

Steve creates a straw man. It is true that there are many bitcoiners that believe bitcoin is not a MOE. Some will say that it must first become a SOV and then as adoption grows it will be used as a MOE. There are also those that believe it is and can be both. I believe many stackers including me are in this camp. There are also those that do not care at all about the MOE use case. I believe he's creating a straw man with this argument. The reality is that in the US and the wealthy nations of the world MOE is not a huge problem. However, with fiat the fruits of our labor are a melting ice cube without bitcoin. So of course SOV is going to be a bigger demand. Steve likes to say he is for the market making decisions. Its interesting because it would appear that the market did make the choice. :)

Steve argues that the small blockers have created a situation where big companies are required to use bitcoin as a MOE. I think its a rather ironic point to make seeing as the big blockers created a situation where it is not reasonable for plebs to be able to run their own nodes. As a user of bitcoin and someone that has done every aspect of bitcoin on the technical side bitcoin has a long way to go to be used by every person on the planet as a MOE. Its well on its way but there is a ways to go yet. That said, the reality is that the average person isn't going to care about any of these things. But the average person is only one consideration. Bitcoin if successful will attract businesses of all sizes. From what I have seen it seems to that the big businesses he seems to be talking about are the exchanges. I fail to see how bitcoin cash has addressed this "problem". Maybe I am just not understanding his point.

He may be referring to Lighting centralization and other L2s. If so, that is a valid concern but I disagree that it is more of a concern than node centralization. Being able to validate our own transactions is a very core feature for me and most of the hard core bitcoiners I respect.

So he starts off by saying lightning doesn't work. That's funny because I literally use it every day and it works. Its not perfect. I don't think it is ready for mass adoption but I also don't see mass adoption in the short term as likely. He also states that lightning requires on-chain transactions. This is true but he doesn't really explain that it basically batches many small transactions therefore making it far more efficient. He falsely states that these channel opens cost $50. As a lightning node operator I have not experienced this level of fee for a channel open. If I were running it as business though this would be an issue.

Over and over again with technical discussions I see people make the mistake of not considering trade-offs. There are no real solutions, only trade-offs as Thomas Sowell once said. Bitcoin cash solved high on-chain fees by increasing the block size. This created other negative trade-offs. Its never as simple as people like it to be.

Satoshi's vision was never for bitcoin to be a store of value. It is interesting to me to hear people still appealing to Satoshi's after all these years. I mean, I get it. The appeal to authority angle works on many people. Honestly, I find it hard to believe that with the hard cap on supply that Satoshi didn't see bitcoin as being both a MOE and a SOV. It just seems odd with all the gold analogies. Now, it is clear to me that he didn't see bitcoin as only a SOV. But again, that's a straw man. Of course there are bitcoiners that see bitcoin that way but honestly that doesn't matter to me. The way people think about a thing can change over time. Once you create something and put it out in the world you quickly lose the control you thought you had over it. In the end this is why speculating about what Satoshi would say about x is a waste of time. As any software engineer will tell you as your work gets used you almost always find it being used in ways you couldn't have imagined.

I know many long time bitcoiners are probably tired of these guys and this debate. The reality is that there are new bitcoiners every day and the issues raised by small blockers aren't stupid. They have valid points. They just have a poor solution. I wasn't as into bitcoin during the block side wars but I did listen to a few debates on the subject and the small blockers made more sense to me. Go figure. I'm a software engineer. But also, I am an economics nerd and fascinated by market decisions.

Looking forward to the Livera response.