Cryptocurrencies and Bitcoin were created in order to bring new technology to the financial world and to have a new monetary system without having to depend on traditional institutions. Indeed, populist governments will never be able to control the supply of Bitcoin and other virtual currencies.
But of course, virtual currencies have weaknesses and the crypto community shouldn’t put their guard down, governments and regulatory agencies can severely damage them. Indeed, Bitcoin has been damaged in the past during several hacks.
Blockchain technology is one of the latest and most innovative technologies on earth. However, we find that distributed ledger technology (DLT), has weak points as well. But if the technology has proved itself to be very secure and reliable, which aspects of it have been compromised? The problem is not with it, but instead, with the community around it.
Hackers and attackers are able to find weak points among the community. They were able to make the famous virtual currency a less frightening, slower and more inefficient currency. Indeed, this currency is now called Bitcoin Core, or SegWit Coin, rather than Bitcoin.
The attack took place in a very long period of time. It happened slowly, but efficiently. And indeed, there are several individuals that are still convinced that Bitcoin was never been attacked!
What About Scalability?
This attack started around 2014 and 2015 about the scalability debate on Bitcoin. How to scale Bitcoin without compromising security and usability? The debate took place in the most important subreddits and in Bitcointalk.org. These sites were all pretended to debate about how to deal with community issues and crypto development.
The first attacks started when some individuals known as the Core development team, started to promote a Bitcoin that cannot scale or increase the block size. They were saying that the currency would never be able to reach the number of transactions that Visa or MasterCard are able to achieve.
Indeed, the core development team was proposing an off-chain scaling solution rather than an on-chain scalability increase. At the same time, they were proposing something called Segregated Witness (SegWit) that would help transactions to be reduced in size, and thus, helping the network scale.
In addition to it, Core developers were saying that an increase in the block size would never be able to allow for exponential growth, instead, it would just create a mining centralization. Something that they claimed it could lead to a 51% attack.
It is important to mention that the network had a 1MB block size because it was intended to avoid spam on the network.
And it seems that Bitcoin Core supporters were winning the debate on scalability. And indeed, some forums seemed completely empty of bitcoin on-chain scaling supporters. But this was not in this way, there were several individuals that were asking to expand the blocksize and meet the market demand.
But it was clear that what was happening was a censorship campaign against those asking for on-scaling solutions. Moderators were deleting the post about these topics and explained that scaling was not the goal of Bitcoin. Indeed, they installed the idea that scaling bitcoin with on-chain solutions was antithetical to bitcoin.
The leader behind this attack is known as Theymos, who was moderating the r/bitcoin subreddit.
But John Blocke explained that Theymos was a censoring some ideas. He wrote about it:
“Since the limit was introduced in 2010, there have been countless discussions on the necessity as well as the methods that would be used to increase this limit, and Bitcoin transaction processing capabilities with it.”
And indeed, he says that these attempts have been blocked by a group of developers. The censorship expanded due to the fact that the discussion forums were moderated by the same individual.
Developers And Hegemony
And yes, a group of individuals and developers took control of the bitcoin community, diverting the path of Bitcoin. In order to do so, they had to hide the truth about the scaling debate. And indeed, many of the original developers of Bitcoin, that were working with Satoshi Nakamoto himself, were excluded from the project.
Some of the developers even said that high fees and slow transaction times are good for the network and for Bitcoin. Back in 2017, a Bitcoin transaction could have a fee of more than $20 dollars and transaction times of several hours.
And indeed, Bitcoin lost over 70% of its value from its all time high. And since that moment, Bitcoin is not able to recover the price it reached some time ago. One of the main reasons about this situation was related to the scaling debate.
Of course, it is not know yet, whether the Core team, and Blockstream, purposely undermined Bitcoin. Instead, there were some suggestions that explained that Blockstream was compromised because they were bought by AXA Insurance. Some people believe that AXA Insurance was controlled by central bankers that wanted to destroy Bitcoin from the inside.
In an article published by Dollar Vigilante, Berwick commented:
“Blockstream is the biggest funder of Bitcoin Core and employs many of the developers. Who owns Blockstream? Well, one of the main shareholders is insurance giant AXA. CEO and Chairman of both the Bilderberg Group and AXA are the same person, Henri de Castries. Yes, essentially, the person most in control of Bitcoin development is the Chairman of Bilderberg; the place that I have gone for the last three years to expose from the outside! And, even one time, briefly, from the inside. If the globalists wanted to destroy bitcoin, they would do exactly what they are doing with Blockstream.”
Other individuals believe that if governments and financial institutions wanted to destroy Bitcoin they would have done it creating divisions in the community. And indeed, creating more divisions in the Bitcoin ecosystem would make the ecosystem more vulnerable.
This shows that virtual currencies can be harmed. It is possible to attack a network and damage it. It is not enough for a coin to be secure and mathematically stable, it needs a community to be strong, united and ready to debate and communicate. If this is not possible, then the network would fall victim to bad actors that want to destroy the network.
What About The Future?
Not everything is lost. Part of the community was able to born again in Bitcoin Cash (BCH). The community was able to upgrade Bitcoin’s protocol by creating the so called Bitcoin Cash. This currency is the one that keeps the promise of Satoshi Nakamoto. It is able to scale with on-chain proposals to solve the scalability issues and incentivize adoption.
It is important for the community to remain connected, united, and ready to be open for a debate. What happened to the older Bitcoin Core should be a lesson to all the new coins that try to create strong and stable communities.
Even when there is a mathematically perfect coin, if the community is not prepared and educated to fight against misinformation, then every project will have a weak point.