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What Bitcoin really is?

Bitcoin is a technology, a currency, a P2P protocol, the foundational basis of a decentralized world, Bitcoin Cash or Gold or another new cryptocurrency, a bubble, a scam, a blockchain, a payment network, a new type of money, a commodity, a value, an ideal. All these definitions have come up for the first of the cryptocurrencies, by various public and private actors, but Bitcoin has no copyright, no official administrators or owners. Therefore, Bitcoin does not have an official definition.

Bitcoin.org is the most popular educational page about Bitcoin, which is not official. Bitcoin Core is the dominant group of developers by far, also not official. Several governments in different countries have defined, in general, very differently, for them, for their legislation or convenience. Of course, this is not official as far as Bitcoin is concerned.

Is there anything official about Bitcoin?

Is there anything official about Bitcoin, even? The White Paper and Satoshi Nakamoto, perhaps gaining that merit just for being the first source. However, its creator has remained anonymous, we may never find out who it is. He, she or they also did not claim any kind of right. Bitcoin was registered under the MIT License, which reads as follows:

“Permission is hereby granted. Free of charge, to any person who obtains a copy of this “Software” and the associated documentation files. To use the Software without restriction, including without limitation the rights to use , copy, modify, merge, publish, distribute, sub-license, and / or sell copies of the Software, and allow the persons to whom the Software is provided to do the same, subject to the following conditions. The copyright notice above and this notice of permission shall be included in all copies or substantial portions of the Software.”

In short, anyone is free not only to use Bitcoin, but to modify its protocol and even sell it. As for what is Bitcoin and its characteristics, strictly speaking and against all odds, we can not find much guidance in its White Paper. Yes, there is described a purely peer to peer version of electronic money. But it is called bitcoin only in the title. In fact, the term bitcoin only appears twice throughout the document, and both are in the header. The only other one is the Bitcoin.org website.

Phrases like “Bitcoin is X, Y or Z” or “Bitcoin has the following characteristics” are completely absent. From the first document intended to describe your system. Something, at least, curious. As if Satoshi himself wanted to leave the definition open to the public, he simply uses sentences such as “A purely peer to peer version of electronic money would allow online payments to be sent directly from one party to another without going through an financial institution.” What we needed is an electronic payment system based on cryptographic tests instead of trust. Or we define an electronic currency and not specifically bitcoin as a chain of digital signatures.

Satoshi’s opinion about Bitcoin

Only later, outside of the White Paper, Satoshi would dare to use the long evaded “Bitcoin is” in the release notes of the alpha version. That is, “Bitcoin is a new electronic cash system that uses a peer to peer network to avoid double spending. It is completely decentralized, without a server or central authority.”

A concise and very flexible concept, which makes it seem, inevitably, to many other cryptocurrencies. This was probably the root cause for the fight over the name with Bitcoin Cash.

For that moment, Roger Ver and Bitcoin.com tried to name the cryptocurrency BCH, newly born, as the true Bitcoin. What could be argued against? Based on what? The truth is that Bitcoin Cash, according to Satoshi’s previous definition, is also an electronic cash system that uses a peer to peer network to avoid double spending. Whether it is decentralized, or not, is still in discussion. Does that imply that other cryptocurrencies whose decentralization is proven could take the name of Bitcoin? Maybe Litecoin or Bitcoin Gold could claim the title? Or, if it proved its complete decentralization, could Bitcoin Cash do it? And what would happen to the network that was created first, would not it be Bitcoin?

During the conflict with Bitcoin Cash, many sought to sue Roger Ver for trying to usurp the Bitcoin name. However, as Jameson Lopp stated, “There is no website, forum, social media account, foundation, code repository, conference, business alliance or organization of any kind that defines bitcoin.” Therefore, what would the demand be about? Whose rights are violated, if no one owns Bitcoin? The main argument to this was that investors could get confused of platforms and put their money and lose it into something. Which is, in the first place, they would not have chosen if they did not have the word bitcoin in their name. And it is that BTC and BCH have a fundamental difference. That is their block size. They are not identical block chains.

What do we call Bitcoin then, and why?

If we turn to Satoshi, the only vaguely official Bitcoin, the correct string was, first, the longest. And then, the one with the most computational power in his favor. That is, more miners.

Roger Ver, in his presentation on why Bitcoin Cash is Bitcoin, describes a series of technical characteristics that, according to his compilation of the White Paper, Satoshi’s comments on the website and the Bitcoin.org page, should have the legitimate Bitcoin. Now, as we discussed, Satoshi does not actually define Bitcoin in the White Paper and Bitcoin.org is not official. Everything is subject to interpretation and that is precisely what he himself used to give the title to Bitcoin Cash, using quite debatable or erroneous statements, such as that the first blockchain is not really a P2P electronic cash system, when clearly it is.

In any case, we can propose a hypothetical scenario where Ver is technically correct, and it turns out that the BCH has those characteristics and the BTC does not. Would this give you the title automatically? The answer is no. In the same way, we can affirm that Bitcoin (BTC), in fact, has more computational power and / or is the longest chain. Is that what Bitcoin does? The answer there is no again. And because?

Bitcoin is more than a person, organization or company

Elizabeth Stark, CEO of Lightning Labs, raised a scenario where a government manages to attack this longer network or with greater computational power and seizes it, with the capacity to modify everything. We can imagine that most of the miners and even that most of the developers are part of the same government. So, they could start to implement their own rules, at their convenience. Would the users still be there, thinking that this is Bitcoin only because it is the chain with the most power? Or would you prefer to migrate to a much more humble but decentralized chain?

Thinking about it, it becomes clear that Bitcoin is more than a handful of technical specifications. Which are only factors to define it. Also, Bitcoin is more than a person, organization or company. Satoshi, the most official available, disappeared from the crypto world almost nine years ago. Bitcoin continued without him and his adoption increases more and more. Even in the dark scenario in which Satoshi had decided a posteriori, suddenly, to create another Bitcoin. A private one, with copyright, it is likely that users would not have accepted such a thing. As one of the key factors that define it , decentralization, would have been lost. In this scenario, the independent developers division would be almost safe, keeping the original chain decentralized.

Hypothetical scenario of Bitcoin

Let’s talk about a hypothetical scenario more. Some group decided to create, today, a completely decentralized cryptocurrency, identical to Bitcoin, bifurcated directly from the first blockchain, and consider that it should keep the title. The crucial difference that they propose, let’s say, is a more immediate solution to make transactions more private. In Bitcoin there are several proposals to achieve that. Of course, but this hypothetical group does not like how slow Bitcoin Core works or they disagree with its conservative philosophy. This creates a new cryptocurrency, also decentralized and with a P2P electronic cash system.

Which of the two should we call Bitcoin? The new one works very well. It has not had security flaws. Mining is not concentrated anywhere. He is only fixing the bugs of his private system, while core implements a different one and fixes his own bugs. Would the fact that one came first and another later, or that one has greater computational power than the other come into play here? Can be, but not necessarily.

Maybe Bitcoin.org is not official, but says something that I think is very successful

In the same way that no one controls the technology behind email, Bitcoin does not have any owners either. (A) Bitcoin is controlled by all Bitcoin users in the world. Although programmers improve the software, they can not force a change in the Bitcoin protocol. Because all other users are free to choose the software and version they want. To keep them compatible with each other, all users need to use software that complies with the same rules. Bitcoin can only work properly if there is consensus among all users.

Each user is free to choose the software and the version he wants. Bitcoin only works correctly if there is consensus. So Bitcoin is basically its users. What they decide, because that’s how it was designed. There is no official answer, actually. As the developer Shinobimonkey mentioned during the debate against BCH.

He said, “Ultimately, I personally believe that bitcoin can not be objectively defined, and I have tried it. At this point, in my opinion it is incumbent.”

Right now, it can be said that most users call Bitcoin to the first blockchain. That’s the real reason why he holds the title, and should always be. Personally, I believe that Bitcoin has created a whole world and has laid the foundations of an ideal that can transcend it. Its definition should not be pigeonholed.


Also published on Medium.

Published inCryptocurrencies

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