How To Be A Bitcoin Maximalist
2JH1454 HEATH LEDGER, THE DARK KNIGHT, 2008
- ISM: a system of beliefs accepted as authoritative by some group or school.
- IST: a follower of a distinctive practice, system, or philosophy.
Call it a sign of the bear market, but debate over Bitcoin
In the wake of venture capitalist Nic Carter’s call to reject the ideology, there have been no shortage of articles on the subject, on its origins, inconsistencies, and what its relevance says about the warring isms in the market at large.
It’s a worthy effort. After all, the exploration succeeds in eradicating one of the worst lenses imposed on the sector, that its social groups are a symptom of investment asset mania, no different from those blindly betting on meme stocks in traditional markets.
It’s a view which, while common in the media, excludes the essential differential: Cryptocurrency market isms are built on claims about the economic and computer science advances Bitcoin and cryptocurrencies have achieved, and thus have a direct relationship to those claims.
While some are the product entirely of fandom, others are more complex, attempting to both define a scientific position, and then encourage beliefs and conduct based on those claims.
Indeed, it is the latter definition which best categorizes Bitcoin Maximalism, and why it has emerged as a flash point for a crypto industry in the midst of a down market.
Compounding the debate is a lack of definitional clarity. Ask two people what Bitcoin Maximalism is, and you’re bound to get four answers.
In my most recent Forbes article, I introduced a three-point definition, arguing the movement is shaped by certain beliefs:
- That Bitcoin is a free market economy and fair monetary system (operating outside the state)
- That the advancement of its economy is only limited by further invention
- That all crypto assets compete with this definition (offering weaker guarantees for users, and thus should be opposed to varying degrees).
Adding to the ire is the final point, that Bitcoin Maximalism is an antithesis to the dominant ism of the day, crypto agnosticism, or the belief that all (or many) crypto assets are unique investments, an emerging “asset class” in which Bitcoin is but a “digital gold” in the process of being outcompeted or replaced.
Still, I’ll admit this definition stops short of being satisfactory, as Bitcoin Maximalism’s chief offense is its antagonism.
And indeed, it is that practical application its critics most often reject, arguing Bitcoin Maximalism encourages Bitcoin Maximalists to be intolerant and belligerent, and to ignore and misrepresent the reality of the market in practice.
I have even been accused of seeking to reclaim the term in my writing, excusing the bad behavior of some Bitcoin Maximalists in an effort to elevate the ism’s more virtuous tenets.
However, my response would be that this is an essential exercise – without separating the aspiration (the ism) from its adherents (the ists), it’s impossible to evaluate what Bitcoin Maximalism encourages, either in theory or in practice.
Still, should there be a gap between the ism and the ists, this piece will seek to correct it, offering a view on the principles that underlie Bitcoin Maximalism, one shaped by my years of studying crypto isms (initially from a lens of skepticism).
With that vantage, my assertion is most Bitcoin Maximalists are united in the following beliefs, which while challenging to the status quo, are ultimately positive for Bitcoin users and humanity at large.
1. A Commitment to Safeguarding Bitcoin for Future Generations
Bitcoin Maximalists believe that Bitcoin is the lone global, digital alternative to state managed economies that, by virtue of its design, can withstand both government attack and centralization over time, and thus, it alone among monetary systems, has the opportunity to offer a truly neutral money in perpetuity.
They therefore, above all, seek to preserve the future use of such a system by humanity.
In this view, Bitcoin Maximalism’s foremost goal is to help other users secure both the system itself (Bitcoin) and the assets in its economy (bitcoins) for future use.
Bitcoin Maximalists assume that we may have not yet seen the full scale of attacks that could disrupt or subvert the Bitcoin system, and that these attacks may increase over time. They accept that we do not have all the answers about how Bitcoin works or will work, and seek to develop this understanding through research, dialogue, and debate.
They believe cryptocurrencies with a lower likelihood of standing this test of time should be criticized and their distinction from Bitcoin made clear.
2. A Commitment to Running the Bitcoin Software
Bitcoin Maximalists believe that the defining feature of the Bitcoin economy is the ability of all users to audit its money supply and history of transactions by running software.
They, therefore, run and encourage others to run the Bitcoin software, believing that it is the operation of the software (not simply the ownership of the asset) that is key to both its decentralization, keeping the network free from fraud.
As such, they seek to make it easier for Bitcoin users to run the software, creating tools and programs that ease the barrier to entry.
Bitcoin Maximalists also question cryptocurrencies whose networks have a low number of software users, or that impose high barriers to running the software.
They assert that cryptocurrencies that do so should be criticized for this issue, and their distinction from Bitcoin should be made clear.
3. A Commitment to Slow Software Changes and Enfranchising Users
Bitcoin Maximalists see Bitcoin as the product of decades of failed attempts to build working digital cash, and that this invention does not require significant improvement.
They believe, should a gap between the capabilities of the Bitcoin software today and its full potential be uncovered, approval of the technical change should be a slow and deliberative process, one that is only made with near universal consensus (and no vocal dissent).
This is because Bitcoin Maximalists accept the right of all users to run and use the software at all times, and oppose all efforts to enact changes to the software that would require users to upgrade to a new version that is incompatible with their version.
They accept they cannot foresee or predict every instance in which someone may need to use Bitcoin, or the extremity of their circumstance, and believe that anyone who needs to use the Bitcoin software should never be denied this ability through a lack of availability.
Thus, they believe that cryptocurrencies that upgrade their software through such processes risk disenfranchising users, and that because of this, their developers should be questioned and the distinction between their software from Bitcoin made clear.
4. A Commitment to Building Products and Services on Bitcoin
Bitcoin Maximalists acknowledge entrepreneurs will attempt to build products and services for Bitcoin users, which operate outside of the Bitcoin codebase, but seek to hold these businesses to a high standard.
While it is acknowledged some Bitcoin users will want to use custody or lending services, these systems can and do pose a real risk to users. (As the recent collapse of large custodians like Celcsius and Voyager shows).
Bitcoin Maximalists accept they cannot stop the creation of such businesses, but strive to ensure their users understand the trade-offs they make when using them, and how they compare to the direct custody of Bitcoin.
Further, they believe, over time, many of these services can be recreated in ways that leverage the trustless properties of Bitcoin, and strive to rebuild these services in ways that improve the trade-offs and risk profile for users.
To date, advances in this area have included multi-signature wallets, which allow users today to divide their bitcoins between high-security vaults, and new proposals like fedimints, in which users can trust friends to help them secure their Bitcoin.
They believe that crypto services that seek to profit from the custody of their users Bitcoin should be questioned and their distinction from Bitcoin-based alternatives made clear.
5. A Commitment to Using Bitcoin to the Greatest Extent
Bitcoin Maximalists seek to extend the Bitcoin economy by using and testing products actively, and by encouraging others to do so.
They seek to encourage local merchants to accept Bitcoin, and strive to pay others in Bitcoin, growing the economy to the greatest possible extent.
They accept that the system today is not capable of yet managing the full financial lives of users, but believe that, over time, they can develop services that extend the use of Bitcoin to encompass more of this activity.
Perhaps the best example of this to date is the Bitcoin Lightning Network, an open-source software built on Bitcoin that enables users to send payments at a low cost, and that is a viable alternative to traditional payment platforms (if not in Western markets, than in the developing world where alternatives are lacking entirely).
In sum, they respect the right of users to decide when and where to use Bitcoin, but aspire to increase the activity of the Bitcoin economy.
6. A Commitment to Opposing Censorship and Surveillance
To ensure the Bitcoin software will be maximally successful, Bitcoin Maximalists seek to acknowledge the attack vectors by which the network could be subverted.
Thus, they are skeptical and critical of any company or service that would seek to monitor users or increase the knowledge hostile actors may have of the Bitcoin system as a whole, understanding they must protect the network for long-term use.
They accept that these services cannot be entirely eliminated today, but strive to support software and services that improve the privacy and anonymity of Bitcoin users, recognizing that these tools may be critical to the survival of the system and the protection of users.
They believe that cryptocurrencies that offer a greater privacy today should be studied so that privacy upgrades for Bitcoin can be better understood, but seek to question their viability as an investment, given it may be possible to rebuild these systems on Bitcoin over time.
7. A Commitment to Supporting Mining by Any and All Means
Bitcoin Maximalists understand that proof-of-work is essential to the operation of the network and believe there are no alternatives to this system that exist without trade-offs that would reduce the viability of that economy.
This is because, at its heart, they believe proof-of-work is the only consensus method by which a cryptocurrency can be distributed to anyone in the world in a free market without barriers to entry imposed by any group.
They are sympathetic to the fact that the fundamentals of how and why Bitcoin mining works are not well represented through observations of the industrial mining sector today, but strive to make distinctions between the two concepts clear.
Yet, they are critical of crypto assets and services that misrepresent proof-of-work, and use these misrepresentations to boost the market viability of softwares and services where they have a greater control.
Bitcoin Maximalists believe that proof-of-work is so essential it should be supported by any means, miners operating on renewable energy as valuable to the system as ones that use oil, nuclear, or any other alternative fuel.
8. A Commitment to Crypto Minimalism
Bitcoin Maximalists are skeptical and critical of claims to technical advances made by other cryptocurrency softwares, and seek to maintain and bolster a culture of scrutiny.
Still, they acknowledge there are new services and products made available in the crypto sector, and that the product of this effort can provide learnings to Bitcoin.
However, they believe that these crypto assets and services are profiting off the short-term limitations of Bitcoin, and thus their use should be discouraged in order to inspire and fund the development of like offerings built on the Bitcoin network.
After all, any resources spent toward improving other networks, is effort that could have bolstered Bitcoin.
Examples of this may include US dollar stablecoins like Tether
They assume that in taking this path, they can encourage alternatives to crypto assets and services that issue tokens, especially when the sale of the tokens creates separate classes of investors with different risk profiles based on the project’s success or failure.
They believe that by building these services on Bitcoin, they can align incentives whereby the value of such services benefit all users of Bitcoin equally, and thus exist without undue benefit to any privileged investor or narrow shareholder group.
9. A Commitment to Keeping Bitcoin Open for All
Bitcoin Maximalists believe everyone in the world should use Bitcoin as money, and that the Bitcoin economy will ultimately be used by all people regardless of race, religion, or nationality.
Thus, they seek to inform and educate people from all walks of life about the benefits of Bitcoin when possible, assuming that everyone can benefit from the use of Bitcoin.
They accept some people may hold ideological biases that may hold back their adoption or use of Bitcoin, and when warranted, strive to be critical of these ideological biases.
Still, they strive to advance Bitcoin before any other ideology or interest, and do not seek to promote Bitcoin only for the advancement of a certain ideology or group.
Conclusion
The definition of Bitcoin Maximalism above will doubtless find detractors, and there are some who would dismiss it altogether, favoring some stricter or more succinct description.
As always, this is Bitcoin, so recognize that no one is telling you to adopt this framework if it’s not useful to you (least of all myself).
Still, if Bitcoin Maximalism is to succeed as an ism, becoming in the view of author Balaji Srinivasan, an influential system of beliefs on the world stage, my argument remains that the movement can become more positive and aspirational, less defined by what it is against, and more defined by what it is for.
At the end of the day, no amount of aggression on the part of Bitcoin Maximalists will make the wider crypto economy or the world of government monies disappear, nor will it fully advance the goals of the Bitcoin movement as a whole.
Certainly, the recent events in the crypto sector have drawn a contrast between what Bitcoin is seeking to achieve and the offerings of the wider crypto world. That is a success.
It’s up to Bitcoin Maximalists to build on it.