Bitcoin: Stay calm and carry on ..
The chorus of bitcoin failures continues…. this time triggered by Mike Hearn’s note : https://medium.com/@octskyward/the-resolution-of-the-bitcoin-experiment-dabb30201f7#.68rex7ynp
I believe we are at the beginnings of a tectonic shift unleashed by the bitcoin experiment. Will bitcoin be ‘the’ currency? I don’t know. Are we at the hype cycle for blockchain startups? Maybe….
To me, bitcoin is an ongoing successful social experiment
It’s use of blockchain showed how we could create a system of trust in a world of random and anonymous users. It showed how to solve the Byzantine Generals’ problem in a probabilistic way even though theoretically it didn’t seem likely. And in doing so, it laid the foundation for an entire decentralization movement. We now have newer iterations like Ethereum and attempts like IPFS at decentralizing the web itself… We have now have decentralized business models attacking a number of centralized trust model across various domains.
The other aspect of the experiment is — can we have mission critical systems not just be open-source but run as completely decentralized systems which no one really controls? Who is responsible to maintain it? Who makes the final call on how to fix it ? How do you co-ordinate any action needed across so many random, unknown, and anonymous users?
Most of you might remember the bitcoin fork in 2013 — what was meant to be an immutable ledger as the single source of truth started splitting into two sources of truth.
It was fascinating to see how coredev quickly got together, reached consensus and was able to put a fix out soon. And how they convinced everyone to adopt the fix. And how the way incentives designed made sure that every actor acting in their self-interest made the global system more stable.
Arvind Narayanan beautifully reconstructed how the events unfolded @ https://freedom-to-tinker.com/blog/randomwalker/analyzing-the-2013-bitcoin-fork-centralized-decision-making-saved-the-day/ . Fascinating read..
The current issue of the block size ( and by proxy — speed of transaction vs. degree of decentralization) highlights another key aspect — How and who drives the long-term product direction? What if the community doesn’t converge on the direction? The whole issue about the block size feature has shown the fissures in the decentralization model. I am sure these are just growing pains of this model and will eventually be a good case study on how self-organizing systems evolve.
So while it seemed easy to converge of quick fixes, it seems harder to reach consensus on longer-term product features
But the experiment continues on… And the revolution carries on…
It is really sad to see Mike leave, given the critical part he played in getting to where we are at.
For the rest of us, time to hunker down and hack away at decentralizing our institutions and societies based around centralized trust systems to a new and exciting decentralized world.