Crypto
Bitcoin Maximalism Is The Way Of The Peaceful Warrior
Published
2 years agoon
This is an opinion editorial by Nozomi Hayase, a contributor at Bitcoin Magazine.
Recently, prominent venture capitalist, Nic Carter of Castle Island Ventures, came under scrutiny on Bitcoin Twitter. He was piled on by Bitcoiners over controversy involving his firm’s investment in a company called Dynamic that uses a Web3 wallet platform.
In response to their outrage, Carter wrote an article titled “Setting the Record Straight. Or: A Eulogy for Bitcoin Maximalism.” There, he criticized Bitcoin Maximalism as an ideology and asserted that a small group of people who are wrapped around it, impregnated the Bitcoin space with an awful sickness. But is this true? What is Bitcoin Maximalism?
Pete Rizzo, an editor for Bitcoin Magazine, wrote an excellent article tackling this question. He analyzed how the narrative evolving around Bitcoin Maximalists is a cultural war. This narrative is the legacy system’s attempt to co-opt Bitcoin’s new monetary system that diverges from the speculative Wall Street casino economy.
Rizzo roughly defined Bitcoin Maximalists as a group that believes bitcoin is a computer science invention and is the only cryptocurrency that is decentralized. This is the critical value proposition that makes Bitcoin the world’s first non-state monetary system, and that is what differentiates it from all other cryptocurrencies.
Bitcoin Evangelism
Those who recognize Bitcoin’s special property known as proof of work, have become an ardent supporter of this technology. They enthusiastically speak about its significance regularly. Statements made often have the following themes:
“Bitcoin is the hardest money that has ever been created.”
“Bitcoin could end the Federal Reserve and stop their insidious money printing that steals our hard earned value through taxation and inflation.”
“It will deliver humanity from the evil of the central banks.”
With a passion that accompanies religious zest and fervor, Bitcoin Maximalists go around spreading their message in hopes of orange-pilling their no-coiner families and friends. Just like Jesus Christ’s apostles who were challenged by those who do not want to worship Jesus, Bitcoin evangelism is also met with indifference and opposition.
From early on in its development, Bitcoin attracted detractors and hatred. From economists and bankers to policymakers, those who are entrenched in the legacy system saw it as a threat to their existence. They criticized Bitcoin with sensational media headlines depicting it as a Ponzi scheme and “too volatile to be a store of value.”
Die-hard Bitcoin devotees took their missionary work to another level. They began to actively defend the protocol’s core values. Slowly, Bitcoin Maximalism has emerged with sets of moral principles, like the way of the peaceful warrior.
Formula For Action
In exploring this moral code, I will turn to Dr. Martin Luther King Jr. and the formula he put forth to engage people in the struggle for civil rights. King didn’t live long enough to see the coming of Bitcoin, but if he were alive today, I think he would be a natural ally with Bitcoiners because he was fighting against the injustice and oppression inherent in the U.S. petrodollar, imperialist system. He would recognize and embrace the technology’s revolutionary power that could abolish debt-slavery and financial apartheid, eradicating poverty and war.
In his fight for freedom, King drew inspiration from the gospel and used its guidance to overcome adversaries that confronted him. King looked into Jesus’ teachings that he gave to his disciples. It is summed up in one sentence as follows:
“Be ye therefore wise as serpents, and harmless as doves.” — Matthew 10:16
In one of his sermons, King decoded this wisdom that combines seemingly opposing characteristics. By blending the toughness of the serpent and the softness of the dove, he created a formula for action, which he called “A tough mind and a tender heart.”
Tough Mind
Let’s first look at the characteristics of a tough mind. King described it as “incisive thinking, realistic appraisal and decisive judgment.” He said:
“The tough mind is sharp and penetrating, breaking through the crust of legends and myths and sifting the true from the false. The tough-minded individual is astute and discerning. He [or she] has a strong, austere quality that makes for firmness of purpose and solidness of commitment.”
He pointed out how individuals with a tough mind are rare, and that most people are willing to settle with half-truths. He noted how soft-minded people are gullible and easily swayed by advertisements and media.
Developing and exercising this tough mind is one of the essential codes of conduct for Bitcoin Maximalism. Many of those who claim to be maximalists engage in rigorous intellectual endeavor. They spend time and energy to understand the real innovation behind Bitcoin and how proof-of-work mining provides unique utility that other chains do not have. We see this demonstration of a tough mind in the Bitcoin space.
When Nic Carter made a comment on proof of stake, applied cryptography consultant Peter Todd quickly called on his lack of technical knowledge:
Bitcoin consultant and educator Giacomo Zucco also jumped in to bring clarity:
As influencers and scammers try to exploit newbies, individuals with a tough mind bring discernment. Adam Back, cryptographer and inventor of hashcash, who has been warning about speculative altcoins, explained the fundamental difference between bitcoin and other coins:
Calling it a “swarm of cyber hornets,” Michael Saylor recognized the maximalists’ deployment of a tough mind generating a kind of intelligence. While some see its value, others see it negatively. Those who have been challenged by the sharp mind of maximalists claim they are mean and aggressive. They even created the label “toxic maximalist.”
But this tough mind is just one aspect of Bitcoin Maximalism. By itself, it is not complete. The way of the peaceful warrior requires the creative synthesis with its opposite.
Tender Heart
After emphasizing the importance of a tough mind, King urged us not to stop with its development. He said, “Tough mindedness without tender heartedness is cold and detached. It leaves one’s life like a perpetual winter devoid of the warmth of spring and the gentle heat of summer.”
Describing a hard-hearted person lacking the real compassion and concerns for pains and suffering of fellow human beings, he reminded us to cultivate a tender heart.
Founder of Bull Bitcoin, Francis Pouliot, articulates qualities of Bitcoin Maximalists that are often not recognized:
It is a sense of moral responsibility and obligation to the public that drives many of maximalists’ actions:
With their tender hearts, Bitcoin Maximalists can help people identify scams and not become victims of fraud:
Der Gigi points out what is characterized as toxicity is an expression of love:
This “Satoshi love” transcends borders through people’s creative endeavors. Artists demonstrate great mastery of the power of the heart. Using their creativity, musicians, painters and meme-makers gently invite people to open their minds and look at things in a new way, helping them question their preconceived notion of what money is:
Kindness and generosity of individuals are pushing nation-state adoption:
“High Priest of Bitcoin” Max Keiser and “fairy godmother” Stacy Herbert, who have been fierce advocates for Bitcoin since its early years, now expand their mission to assist people in El Salvador, the country that adopted a Bitcoin standard. The pair distributed a generous amount of bitcoin and met with locals who had been harmed by gangs.
The Path Of Decentralization
I hear many people in the Bitcoin community say Bitcoin is like a teacher and that it helps them become a better person.
I see Bitcoin Maximalists as those who are inspired by Bitcoin and aim to maximize the values that it represents. In this sense, I say Bitcoin Maximalism is not an ideology and a fixed thing. Rather, it is a process and a striving of becoming that individuals commit themselves to and engage in out of their own volition.
Bitcoin itself, embodies the creative synthesis of the opposites: tough mind and tender heart. At the core of the protocol is censorship-resistance. It is the heart that accepts our radical differences.
Bitcoin is an open and inclusive network that does not discriminate against anyone. With the principle of consensus, it does not make anyone act against his or her own will. This “magical internet money” flourishes with diversity, while enforcing rules and maintaining the unity of a network. With a tough mind, knowledge of computer science and strong cryptography, Bitcoin defends the freedom of everyone and secures the network.
The era of modern central banking has brought lots of pain and suffering to our society. Now, Bitcoin creates the separation of money and state for the first time in history. It gives the possibility for humanity to break away from the oppressive past.
As inflation accelerates combined with growing geopolitical conflicts, decimating our economy, the world is quickly moving into an abyss of chaos. In this sea of darkness, Bitcoin offers a rescue boat.
The need for Bitcoin adoption is increasing day by day. In the years to come, as Bitcoin gains more value, attacks on the network will intensify. Bitcoiners need to stay vigilant and alert. At the same time, we need to develop the capacity for empathy and understanding for those who have yet to see the light on the other side.
Bitcoin is for everybody. The path of decentralization is paved through each of us engaging in the practice of Bitcoin Maximalism. We must become the peaceful warrior to build a road toward hyperbitcoinization, delivering freedom, justice and prosperity for all.
This is a guest post by Nozomi Hayase. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.
Crypto
El Salvador Takes First Step To Issue Bitcoin Volcano Bonds
Published
2 years agoon
November 22, 2022
El Salvador’s Minister of the Economy Maria Luisa Hayem Brevé submitted a digital assets issuance bill to the country’s legislative assembly, paving the way for the launch of its bitcoin-backed “volcano” bonds.
First announced one year ago today, the pioneering initiative seeks to attract capital and investors to El Salvador. It was revealed at the time the plans to issue $1 billion in bonds on the Liquid Network, a federated Bitcoin sidechain, with the proceedings of the bonds being split between a $500 million direct allocation to bitcoin and an investment of the same amount in building out energy and bitcoin mining infrastructure in the region.
A sidechain is an independent blockchain that runs parallel to another blockchain, allowing for tokens from that blockchain to be used securely in the sidechain while abiding by a different set of rules, performance requirements, and security mechanisms. Liquid is a sidechain of Bitcoin that allows bitcoin to flow between the Liquid and Bitcoin networks with a two-way peg. A representation of bitcoin used in the Liquid network is referred to as L-BTC. Its verifiably equivalent amount of BTC is managed and secured by the network’s members, called functionaries.
“Digital securities law will enable El Salvador to be the financial center of central and south America,” wrote Paolo Ardoino, CTO of cryptocurrency exchange Bitfinex, on Twitter.
Bitfinex is set to be granted a license in order to be able to process and list the bond issuance in El Salvador.
The bonds will pay a 6.5% yield and enable fast-tracked citizenship for investors. The government will share half the additional gains with investors as a Bitcoin Dividend once the original $500 million has been monetized. These dividends will be dispersed annually using Blockstream’s asset management platform.
The act of submitting the bill, which was hinted at earlier this year, kickstarts the first major milestone before the bonds can see the light of day. The next is getting it approved, which is expected to happen before Christmas, a source close to President Nayib Bukele told Bitcoin Magazine. The bill was submitted on November 17 and presented to the country’s Congress today. It is embedded in full below.
Crypto
How I’ll Talk To Family Members About Bitcoin This Thanksgiving
Published
2 years agoon
November 22, 2022
This is an opinion editorial by Joakim Book, a Research Fellow at the American Institute for Economic Research, contributor and copy editor for Bitcoin Magazine and a writer on all things money and financial history.
I don’t.
That’s it. That’s the article.
In all sincerity, that is the full message: Just don’t do it. It’s not worth it.
You’re not an excited teenager anymore, in desperate need of bragging credits or trying out your newfound wisdom. You’re not a preaching priestess with lost souls to save right before some imminent arrival of the day of reckoning. We have time.
Instead: just leave people alone. Seriously. They came to Thanksgiving dinner to relax and rejoice with family, laugh, tell stories and zone out for a day — not to be ambushed with what to them will sound like a deranged rant in some obscure topic they couldn’t care less about. Even if it’s the monetary system, which nobody understands anyway.
Get real.
If you’re not convinced of this Dale Carnegie-esque social approach, and you still naively think that your meager words in between bites can change anybody’s view on anything, here are some more serious reasons for why you don’t talk to friends and family about Bitcoin the protocol — but most certainly not bitcoin, the asset:
- Your family and friends don’t want to hear it. Move on.
- For op-sec reasons, you don’t want to draw unnecessary attention to the fact that you probably have a decent bitcoin stack. Hopefully, family and close friends should be safe enough to confide in, but people talk and that gossip can only hurt you.
- People find bitcoin interesting only when they’re ready to; everyone gets the price they deserve. Like Gigi says in “21 Lessons:”
“Bitcoin will be understood by you as soon as you are ready, and I also believe that the first fractions of a bitcoin will find you as soon as you are ready to receive them. In essence, everyone will get ₿itcoin at exactly the right time.”
It’s highly unlikely that your uncle or mother-in-law just happens to be at that stage, just when you’re about to sit down for dinner.
- Unless you can claim youth, old age or extreme poverty, there are very few people who genuinely haven’t heard of bitcoin. That means your evangelizing wouldn’t be preaching to lost, ignorant souls ready to be saved but the tired, huddled and jaded masses who could care less about the discovery that will change their societies more than the internal combustion engine, internet and Big Government combined. Big deal.
- What is the case, however, is that everyone in your prospective audience has already had a couple of touchpoints and rejected bitcoin for this or that standard FUD. It’s a scam; seems weird; it’s dead; let’s trust the central bankers, who have our best interest at heart.
No amount of FUD busting changes that impression, because nobody holds uninformed and fringe convictions for rational reasons, reasons that can be flipped by your enthusiastic arguments in-between wiping off cranberry sauce and grabbing another turkey slice. - It really is bad form to talk about money — and bitcoin is the best money there is. Be classy.
Now, I’m not saying to never ever talk about Bitcoin. We love to talk Bitcoin — that’s why we go to meetups, join Twitter Spaces, write, code, run nodes, listen to podcasts, attend conferences. People there get something about this monetary rebellion and have opted in to be part of it. Your unsuspecting family members have not; ambushing them with the wonders of multisig, the magically fast Lightning transactions or how they too really need to get on this hype train, like, yesterday, is unlikely to go down well.
However, if in the post-dinner lull on the porch someone comes to you one-on-one, whisky in hand and of an inquisitive mind, that’s a very different story. That’s personal rather than public, and it’s without the time constraints that so usually trouble us. It involves clarifying questions or doubts for somebody who is both expressively curious about the topic and available for the talk. That’s rare — cherish it, and nurture it.
Last year I wrote something about the proper role of political conversations in social settings. Since November was also election month, it’s appropriate to cite here:
“Politics, I’m starting to believe, best belongs in the closet — rebranded and brought out for the specific occasion. Or perhaps the bedroom, with those you most trust, love, and respect. Not in public, not with strangers, not with friends, and most certainly not with other people in your community. Purge it from your being as much as you possibly could, and refuse to let political issues invade the areas of our lives that we cherish; politics and political disagreements don’t belong there, and our lives are too important to let them be ruled by (mostly contrived) political disagreements.”
If anything, those words seem more true today than they even did then. And I posit to you that the same applies for bitcoin.
Everyone has some sort of impression or opinion of bitcoin — and most of them are plain wrong. But there’s nothing people love more than a savior in white armor, riding in to dispel their errors about some thing they are freshly out of fucks for. Just like politics, nobody really cares.
Leave them alone. They will find bitcoin in their own time, just like all of us did.
This is a guest post by Joakim Book. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
This is an opinion editorial by Federico Tenga, a long time contributor to Bitcoin projects with experience as start-up founder, consultant and educator.
The term “smart contracts” predates the invention of the blockchain and Bitcoin itself. Its first mention is in a 1994 article by Nick Szabo, who defined smart contracts as a “computerized transaction protocol that executes the terms of a contract.” While by this definition Bitcoin, thanks to its scripting language, supported smart contracts from the very first block, the term was popularized only later by Ethereum promoters, who twisted the original definition as “code that is redundantly executed by all nodes in a global consensus network”
While delegating code execution to a global consensus network has advantages (e.g. it is easy to deploy unowed contracts, such as the popularly automated market makers), this design has one major flaw: lack of scalability (and privacy). If every node in a network must redundantly run the same code, the amount of code that can actually be executed without excessively increasing the cost of running a node (and thus preserving decentralization) remains scarce, meaning that only a small number of contracts can be executed.
But what if we could design a system where the terms of the contract are executed and validated only by the parties involved, rather than by all members of the network? Let us imagine the example of a company that wants to issue shares. Instead of publishing the issuance contract publicly on a global ledger and using that ledger to track all future transfers of ownership, it could simply issue the shares privately and pass to the buyers the right to further transfer them. Then, the right to transfer ownership can be passed on to each new owner as if it were an amendment to the original issuance contract. In this way, each owner can independently verify that the shares he or she received are genuine by reading the original contract and validating that all the history of amendments that moved the shares conform to the rules set forth in the original contract.
This is actually nothing new, it is indeed the same mechanism that was used to transfer property before public registers became popular. In the U.K., for example, it was not compulsory to register a property when its ownership was transferred until the ‘90s. This means that still today over 15% of land in England and Wales is unregistered. If you are buying an unregistered property, instead of checking on a registry if the seller is the true owner, you would have to verify an unbroken chain of ownership going back at least 15 years (a period considered long enough to assume that the seller has sufficient title to the property). In doing so, you must ensure that any transfer of ownership has been carried out correctly and that any mortgages used for previous transactions have been paid off in full. This model has the advantage of improved privacy over ownership, and you do not have to rely on the maintainer of the public land register. On the other hand, it makes the verification of the seller’s ownership much more complicated for the buyer.
How can the transfer of unregistered properties be improved? First of all, by making it a digitized process. If there is code that can be run by a computer to verify that all the history of ownership transfers is in compliance with the original contract rules, buying and selling becomes much faster and cheaper.
Secondly, to avoid the risk of the seller double-spending their asset, a system of proof of publication must be implemented. For example, we could implement a rule that every transfer of ownership must be committed on a predefined spot of a well-known newspaper (e.g. put the hash of the transfer of ownership in the upper-right corner of the first page of the New York Times). Since you cannot place the hash of a transfer in the same place twice, this prevents double-spending attempts. However, using a famous newspaper for this purpose has some disadvantages:
- You have to buy a lot of newspapers for the verification process. Not very practical.
- Each contract needs its own space in the newspaper. Not very scalable.
- The newspaper editor can easily censor or, even worse, simulate double-spending by putting a random hash in your slot, making any potential buyer of your asset think it has been sold before, and discouraging them from buying it. Not very trustless.
For these reasons, a better place to post proof of ownership transfers needs to be found. And what better option than the Bitcoin blockchain, an already established trusted public ledger with strong incentives to keep it censorship-resistant and decentralized?
If we use Bitcoin, we should not specify a fixed place in the block where the commitment to transfer ownership must occur (e.g. in the first transaction) because, just like with the editor of the New York Times, the miner could mess with it. A better approach is to place the commitment in a predefined Bitcoin transaction, more specifically in a transaction that originates from an unspent transaction output (UTXO) to which the ownership of the asset to be issued is linked. The link between an asset and a bitcoin UTXO can occur either in the contract that issues the asset or in a subsequent transfer of ownership, each time making the target UTXO the controller of the transferred asset. In this way, we have clearly defined where the obligation to transfer ownership should be (i.e in the Bitcoin transaction originating from a particular UTXO). Anyone running a Bitcoin node can independently verify the commitments and neither the miners nor any other entity are able to censor or interfere with the asset transfer in any way.
Since on the Bitcoin blockchain we only publish a commitment of an ownership transfer, not the content of the transfer itself, the seller needs a dedicated communication channel to provide the buyer with all the proofs that the ownership transfer is valid. This could be done in a number of ways, potentially even by printing out the proofs and shipping them with a carrier pigeon, which, while a bit impractical, would still do the job. But the best option to avoid the censorship and privacy violations is establish a direct peer-to-peer encrypted communication, which compared to the pigeons also has the advantage of being easy to integrate with a software to verify the proofs received from the counterparty.
This model just described for client-side validated contracts and ownership transfers is exactly what has been implemented with the RGB protocol. With RGB, it is possible to create a contract that defines rights, assigns them to one or more existing bitcoin UTXO and specifies how their ownership can be transferred. The contract can be created starting from a template, called a “schema,” in which the creator of the contract only adjusts the parameters and ownership rights, as is done with traditional legal contracts. Currently, there are two types of schemas in RGB: one for issuing fungible tokens (RGB20) and a second for issuing collectibles (RGB21), but in the future, more schemas can be developed by anyone in a permissionless fashion without requiring changes at the protocol level.
To use a more practical example, an issuer of fungible assets (e.g. company shares, stablecoins, etc.) can use the RGB20 schema template and create a contract defining how many tokens it will issue, the name of the asset and some additional metadata associated with it. It can then define which bitcoin UTXO has the right to transfer ownership of the created tokens and assign other rights to other UTXOs, such as the right to make a secondary issuance or to renominate the asset. Each client receiving tokens created by this contract will be able to verify the content of the Genesis contract and validate that any transfer of ownership in the history of the token received has complied with the rules set out therein.
So what can we do with RGB in practice today? First and foremost, it enables the issuance and the transfer of tokenized assets with better scalability and privacy compared to any existing alternative. On the privacy side, RGB benefits from the fact that all transfer-related data is kept client-side, so a blockchain observer cannot extract any information about the user’s financial activities (it is not even possible to distinguish a bitcoin transaction containing an RGB commitment from a regular one), moreover, the receiver shares with the sender only blinded UTXO (i. e. the hash of the concatenation between the UTXO in which she wish to receive the assets and a random number) instead of the UTXO itself, so it is not possible for the payer to monitor future activities of the receiver. To further increase the privacy of users, RGB also adopts the bulletproof cryptographic mechanism to hide the amounts in the history of asset transfers, so that even future owners of assets have an obfuscated view of the financial behavior of previous holders.
In terms of scalability, RGB offers some advantages as well. First of all, most of the data is kept off-chain, as the blockchain is only used as a commitment layer, reducing the fees that need to be paid and meaning that each client only validates the transfers it is interested in instead of all the activity of a global network. Since an RGB transfer still requires a Bitcoin transaction, the fee saving may seem minimal, but when you start introducing transaction batching they can quickly become massive. Indeed, it is possible to transfer all the tokens (or, more generally, “rights”) associated with a UTXO towards an arbitrary amount of recipients with a single commitment in a single bitcoin transaction. Let’s assume you are a service provider making payouts to several users at once. With RGB, you can commit in a single Bitcoin transaction thousands of transfers to thousands of users requesting different types of assets, making the marginal cost of each single payout absolutely negligible.
Another fee-saving mechanism for issuers of low value assets is that in RGB the issuance of an asset does not require paying fees. This happens because the creation of an issuance contract does not need to be committed on the blockchain. A contract simply defines to which already existing UTXO the newly issued assets will be allocated to. So if you are an artist interested in creating collectible tokens, you can issue as many as you want for free and then only pay the bitcoin transaction fee when a buyer shows up and requests the token to be assigned to their UTXO.
Furthermore, because RGB is built on top of bitcoin transactions, it is also compatible with the Lightning Network. While it is not yet implemented at the time of writing, it will be possible to create asset-specific Lightning channels and route payments through them, similar to how it works with normal Lightning transactions.
Conclusion
RGB is a groundbreaking innovation that opens up to new use cases using a completely new paradigm, but which tools are available to use it? If you want to experiment with the core of the technology itself, you should directly try out the RGB node. If you want to build applications on top of RGB without having to deep dive into the complexity of the protocol, you can use the rgb-lib library, which provides a simple interface for developers. If you just want to try to issue and transfer assets, you can play with Iris Wallet for Android, whose code is also open source on GitHub. If you just want to learn more about RGB you can check out this list of resources.
This is a guest post by Federico Tenga. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.