Bitcoin is suffering from an autoimmune disease right now. People have historically referred to active members in this ecosystem as “Bitcoin’s white blood cells.” They are now attacking Bitcoin itself, and no I am not referring to “plebs” calling out “influencers” for doing dumb shit. I am talking about the inability to confront shortcomings with layers of the system. The inability to confront substantial threats or attack surfaces that are not being worked on in terms of creating solutions and defenses.
People act like Bitcoin is invincible, preordained. It is not. And this is not to say Bitcoin will “fail” in the sense that it will die, even I think that is a very unlikely. But it can lose its scalability. It can lose its characteristic of open access. It can lose its censorship resistance. Bitcoin as a system can survive while losing and gaining new characteristics. The progression of the blockchain, with the thermodynamic and probabilistic guarantee of current state, does not in and of itself guarantee these qualities that we value continue.
As long as that central quality of scarcity continues, it can absolutely lose/gain other characteristics and still maintain value through market demand. I’m going to run through two distinct areas in which this is happening at wide scale, one holding the potential for massive internal disruption and disagreement in the same way that things like Bcash played out, and the other massive potential for government corrosion of censorship resistance.Ouch Short Circuit With Lightning
Lightning is almost certainly not going to scale for micropayments in the long term. Lightning fees are not disconnected from the fee market for blockspace, they are derivative of them. The reason micropayments work natively on Lightning right now is because fees for blockspace are so low right now; when fees for blockspace go up that will drag fees up for Lightning payments as well. It is not economically rational to be routi...