Why Bitcoin Cash matters

Why does Bitcoin Cash matter when cryptocurrencies like Litecoin, Dogecoin, and dozens of other alt coins already exist which work quickly and have low transaction fees? [1]

This is a question I see every day in some form on Twitter or Reddit. I think it comes at worst from people who want to undermine Bitcoin Cash. They know that the other coins are not a threat to Bitcoin Core and they understand that branding Bitcoin Cash as an “alt” would do a good deal of social damage to it. But there are also people who truly misunderstand the nature and the importance of the Bitcoin Cash and Bitcoin Core debates. I’m writing this essay for them.

Though I think there are a number of reasons why we should believe Bitcoin Cash is the best option, including fees and transaction times, I think focusing on them too much is a distraction. When I first developed an interest in Bitcoin Cash, I was thinking along those lines. To me, the question of high fees and low fees was all important. [2]

Now it is my belief that Bitcoin Cash matters more than any other cryptocurrency out there, but it matters for a more fundamental reason than transaction fees and speed. To understand this, we need to understand what happened to Bitcoin Core, previously the most successful cryptocurrency project ever, that started this whole debate. I quote from Mike Hearn:

Why has Bitcoin failed? It has failed because the community has failed. What was meant to be a new, decentralised form of money that lacked “systemically important institutions” and “too big to fail” has become something even worse: a system completely controlled by just a handful of people. Worse still, the network is on the brink of technical collapse. The mechanisms that should have prevented this outcome have broken down, and as a result there’s no longer much reason to think Bitcoin can actually be better than the existing financial system.

Bitcoin Core did not fail for any necessary technical reasons whatsoever. As Hearn wrote, it “failed because the community has failed.” Anybody who tells you otherwise is misinformed or lying. For a large part of Bitcoin’s history, it was understood that Bitcoin could scale on-chain to the entire world. The 1mb block size was supposed to be a temporary measure that was lifted long ago, but through a combination of censorship, subversion, slander, theft, and propaganda, the 1mb limit was never lifted and opposition was silenced. As Mike Hearn said, Bitcoin became “a system completely controlled by just a handful of people.” These people have forced an artificial block size limit on Bitcoin Core that prevents it from scaling and which in 2017 led to the creation of Bitcoin Cash.

Bitcoin Cash then is not trying to answer the question of whether Bitcoin can scale on-chain or not. We know it can, as did Satoshi and everyone else who worked on the project in the early days. This is where people who push other coins against Bitcoin Cash miss the mark in particular. The block size debate is a function of a larger problem. Alexander Hamilton wrote before the breakout of the American Revolution that it was wrong to think

that our contest with Britain is founded entirely upon the petty duty of three pence per pound on East India tea, whereas the whole world knows it is built upon this interesting question, whether the inhabitants of Great Britain have a right to dispose of the lives and properties of the inhabitants of America, or not.

It is likewise incorrect and trivial to think that the entire Bitcoin Cash question is built upon the size of the blocks. Bitcoin Cash matters because it is attempting to answer if a blockchain project can survive being co-opted from within or not. Can a project be protected by a Remnant [3] of good actors against bad ones who have gained control? That is the real unanswered question and I think it is the most important question in cryptocurrency today. No other coin has the chance to do that and we should not allow it to be forgotten in block size discussions.

So if you find yourself wondering why Bitcoin Cash matters in a world of alt coins, this is one big reason. The fact is that if Bitcoin Cash fails it does not bode well for the rest of the cryptocurrency industry. It would mean that any project that gains enough traction is open to being taken over through the same means that Bitcoin was taken over before: censorship, lies, propaganda, theft, slander, and masses of unprincipled useful idiots.

If Bitcoin Cash succeeds however, as I believe it will, it sets a precedent for the future. Its existence and success will be an insurance policy that will remind bad actors that a project can and will fork if it strays from its original intent. As Taylor Pearson writes, the future of society is

…defined by forking. The balance between voice and exit will tilt towards exit. Appeals to authority (and perhaps violence) will be replaced by forking. If you disagree with a decision, you can fork a new blockchain.

This is what we have done by forking Bitcoin Cash and we will see whether it can be an effective check against Orwellian subversion of a project or not.

Like this essay? You can support my Bitcoin Cash writing here.

[1] If you want examples, just say anything positive about Bitcoin Cash on Twitter.

[2] It is still very important of course. Low fees and fast transactions on-chain are essential for user experience and adoption. I recommend Maybe High Fee Coin is a Really Stupid Idea by Ryan X. Charles.

[3] I use the concept of The Remnant because I think it applies beautifully to the Bitcoin Cash community. “The Remnant are those who by force of intellect are able to apprehend these principles, and by force of character are able, at least measurably, to cleave to them. The masses are those who are unable to do either.” – Albert Jay Nock in Isaiah’s Job

Image by Satoshi Doodles