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Every morning at 6am, in Punxsutawney, Pennsylvania, the skeptical weatherman Phil Connors wakes up to relive the same day repeatedly. Trapped in a time loop, Connors exhausts every possible method to restore his life to normal – he faces being stabbed, shot, burned, frozen, and electrocuted, only to awaken the following day as though nothing has transpired. Connors soon arrives at the singular plausible conclusion: he must be a god.
Believing ourselves to be invulnerable has never been a smart tactic, whether in warfare or other contexts. If we consider cosmological views, from Nietzsche to Hinduism, time is cyclical, and there exists a finite set of possibilities that repeat infinitely – the only feasible action is to adjust our responses. If we fail to learn from our mistakes, we are fated to go through the same experiences repeatedly.
Although we often take pride in our exceptional intelligence – I discovered Bitcoin early; I must be quite astute – it appears that learning from our errors remains elusive, even for seasoned ‘Bitcoin advocates’. Public discussions have seemingly transitioned from addressing technological challenges and limitations to casual exchanges reminiscent of Deutsche Bank post-work chit-chats – Anything is conceivable, we just need to keep returns on track.
When Bitcoin was first introduced in the German Parliament back in 2014, ‘experts’ noted the ease with which bitcoin payments could be deanonymized through network analysis, highlighting the danger of widespread bitcoin adoption leading to total financial surveillance. Fast forward a decade, and with Bitcoin back on the German parliamentary agenda, ‘experts’ have been replaced by influencers proposing Bitcoin as alternatives to CBDCs. Present-day ‘Bitcoin political discussions’ evoke images of Bart Simpson running around in circles, banging a pan on his head.
As we move deeper into the echo chamber of opportunists, we have effectively traded academic debate for enthusiastic cheering. Everything will go wonderfully as long as you are ready to ‘take your tits out.’ ‘We’re winning!’ has long since morphed into the dominant meme – Between ETF approvals, stablecoin issuances, and potential nation-state adoption, there exists so much confidence in Bitcoin’s success that we seem incapable of recognizing this very attitude as the precursor to failure. Arrogance typically precedes most declines, and its exploitation has historically been intentional. By nurturing manic delusions of invincibility, even the most seasoned commanders can lead their followers to ruin.
Groundhog Day
A long time ago, in a galaxy far away, we connected our computers to landlines to access the three essential W’s. For those who didn’t live alone, this practice often resulted in significant chaos – “Get off the computer, Mom is waiting for a phone call.”
We can all agree that this was not ideal. However, due to a lack of technological progress and the inability to communicate wirelessly over distances (think of your favorite mesh network here), it was the most convenient option we had. The primary issue: it granted telecommunications providers a monopoly on web access points. Fast forward 20 years, and we now realize that telecom providers monitor, analyze, and report our online activities to government authorities under the pretext of national security. Technology once seen as liberating quickly turned into a major adversary.
It’s impossible to discuss the triumphs (and failures) of peer-to-peer technologies without mentioning Linkin Park. Their music, at that time still encapsulated in Hybrid Theory, circulated widely on the first P2P music file-sharing network, Napster. Downloaded from the computers of others, accessing Linkin Park’s sound was entirely free. Their debut studio album, Hybrid Theory, remains one of the top five best-selling records globally, achieving 15 million copies sold within the first three weeks of its release.
Napster represented a genuine revolution on the internet – and the music industry was outraged. As users freely infected their devices with potential malware, bands, rappers, and singer-songwriters like the Arctic Monkeys, Dispatch, and EMINEM built fanbases even before launching major record releases, which infuriated the musical establishment. Metallica’s lawsuit against the P2P platform for copyright violations highlighted their discomfort, as they felt their cult status and financial returns were at risk; peer-to-peer music sharing did not entirely disappear but was swiftly transformed into more corporate-friendly models – from purchasing music through iTunes to streaming it via Spotify.
Although it seemed impossible to stifle a technology like Napster, convenience ultimately took precedence. Today, most listeners do not own the music they enjoy; instead, they subscribe to corporate databases from which neither artists, labels, nor producers profit. Instead, once again, surveillance came out on top. Just last week, when Spotify updated its cookie policy, a notification informed EU users of the 695 data brokers that would gain access to their data. Downloading files like ClapYourHandsSayYeah.mp3.exe (RIP) was undeniably risky, yet the repercussions of surveillance capitalism reach far beyond a compromised computer.
The same scenario unfolded with search engines. Navigating the early days of the world wide web felt like being dropped in the midst of Yellowstone National Park without a guide. Numerous destinations existed, but knowing their locations was crucial. Through comprehensive link collections, platforms like Yahoo, AskJeeves, or Google offered immense value to those unfamiliar with navigating the WWW. Instead of asking friends for recommendations of interesting sites, one simply asked Google. However, moving beyond word-of-mouth formats led to what is now termed the great enshittification. The first few links consist of paid affiliate sites, followed by those who adeptly manipulated Google’s SEO frameworks, all curated and tailored to your supposed preferences. Today, Google stands as one of the world’s most valuable surveillance companies. A tool initially designed to promote the liberalization of free information has essentially morphed into a vehicle for censorship.
Time and again, believing that ‘technology has prevailed’ only further fuels its decline. We opt for comforting choices now, only to undermine ourselves in the future. And before you know it – BING! It’s the whistling belly button at the high school talent show as the weatherman returns to form. To state it plainly: we are making severe mistakes.
It’s the Filters, Stupid
In today’s pop-culture Bitcoin discussions, ignorance is widespread. Lightning functions until it doesn’t, let’s invest millions to put the Dollar on Bitcoin; it’s all about priorities, darling, look it up.
When Ordinals arrived on Bitcoin – however you may feel about them – we quickly realized we were in a precarious situation. In the global south, individuals began to find it impossible to transact non-custodially. Everyone you’ve advised to DCA suddenly encountered exorbitant transaction fees, rendered unable to move their assets. For those prioritizing their privacy even for minor expenditures, participating in coinjoin rounds became prohibitively expensive. Regardless of where we turn, a scaling issue persists. This issue does not stem solely from Ordinals; it arose because we were so convinced of our eventual triumph that we lost sight of the need to manage our ignorance.
Over the past four years, the majority of Bitcoin proponents were more engrossed in promoting their own narratives – everything is fantastic and Bitcoin is the premier currency on earth – than confronting uncomfortable realities. We then responded with a tremendous amount of shortsightedness: it’s the filters, stupid.
Filtering out Ordinals transactions is merely a short-term fix for an enduring issue. Certainly, blocking arbitrary data on the blockchain will likely reduce fees, but if global Bitcoin adoption is your goal, proposing selective solutions to systemic problems does not serve your interests. The reality is that it is easy to express frustration towards JPEGs. Addressing issues that challenge the ‘greatness of Bitcoin,’ which some individuals have seemingly made their entire identity, is far more daunting. For every tweet asserting that Bitcoin will bring world peace – apparently through some form of magic or what Wall Street’s so-called Bitcoin economists term a convoluted version of game theory – a little piece of the system diminishes.
We don’t require your hopium; we need tangible solutions to real-world concerns. This includes putting down the crack pipe and addressing the uncomfortable truths: we are not winning – in fact, we are doing the opposite because our ‘long-term preference’ extends about as far as our investment portfolios. You can indeed kill Bitcoin, and it’s more straightforward than you might think.
Embrace, Extend, Extinguish
In recent years, discussions about Bitcoin ‘winning’ have followed a similar pattern. Senators are embracing Bitcoin: see, we are succeeding. BlackRock is embracing Bitcoin: see, we are achieving success. First, they ignore you, then they ridicule you, and finally, they recognize that all you desire is a pat on the back before law enforcement arrives to confiscate your toys. The mocking hasn’t ceased; it merely occurs behind your back.
The most probable demise of Bitcoin would not occur in name but rather through its total integration, at a stage where the technology is simply not prepared for ‘mass adoption’ – akin to how we have diminished all preceding peer-to-peer technologies. The demise of Bitcoin does not signify the extinction of the technology but rather the death of its practical usability.
At the heart of Bitcoin’s decline, essentially, continues to be the scaling debate. When Gigablocks were initially suggested, it was apparent that a blockchain requiring 10 years to synchronize would lack decentralization. Enter the Lightning Network, which appeared to resolve all our challenges: Scaling off-chain while securing on-chain. Smart. However, we can only accommodate approximately 5000 channel opening and closing transactions within a block – hardly sufficient for 8 billion individuals to use Bitcoin non-custodially.
Sadly, this did not deter influencers – or anyone, really – from proclaiming their desperate ‘Hail Mary’; Scaling Bitcoin is evidently a concern only for future generations. The thrill of finally being able to join the corporate dinner table and smugly assert ‘I told you so’ proved too enticing. Placing non-believers in their proper place had to take precedence; if Bitcoin isn’t here to nurture our fragile egos and bolster our paltry bank accounts, what really is its purpose? Freedom, Carajo! Welcome to your involuntary conversion at the church of Satoshi’s witnesses, where we deliver sermons on saving the world from tyranny more frequently than Biden changes his diapers.
And here we find ourselves. Six years after we purchased our first stickers at the Blockstream store – the only item available when Lightning implementations were first launched, aside from beer – and we remain in the same chaotic situation. Rather than fostering extensive discussions around covenant proposals, which do present real trade-offs and risks, we are too busy branding anyone unwilling to ossify as a spook, while ossification at this stage in Bitcoin’s evolution could undoubtedly be the most effective method to extinguish it.
In the near future, we may find ourselves longing for a time when fees were merely a few hundred vBytes. By then, we will be compelled to utilize Bitcoin custodially. Say farewell to freedom money: Bitcoin, as we know it, will perish unless we stop repeating our past mistakes.
