PDF Summary:Hijacking Bitcoin, by Roger Ver

Hijacking Bitcoin by Roger Ver recounts the divergent paths taken by Bitcoin and Bitcoin Cash. As Bitcoin surged in popularity, developers at Bitcoin Core prioritized constrained block sizes, driving users to secondary layers. Ver argues this departed from Bitcoin's original vision as peer-to-peer digital cash for everyday transactions.

The book details how Core developers intentionally limited capacity, solidifying their control despite resistance. Ver chronicles the ensuing acrimony, including censorship and misinformation, that fractured the community—culminating in the creation of Bitcoin Cash to revive Satoshi's uncompromised design of low fees and expanded utility.

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The choice to keep the core layer unchanged hindered Bitcoin's growth and broader adoption.

Roger Ver, along with his Bitcoin Cash supporters, firmly believes that the global acceptance of Bitcoin hinges on increasing the blockchain's capacity through the enlargement of block size limits. They have voiced their opposition to different methods intended to improve Bitcoin's ability to process more transactions without increasing the block size, criticizing these approaches as either insufficient or suggestive of a move towards centralization.

Ver cites comments from leading figures within the digital currency sector who have candidly admitted their reliance on conducting transactions at low costs, a position that was strongly contested by the Core developers. The success of the approach that emphasizes smaller block sizes is contingent upon whether solutions on secondary layers can provide a user experience that exceeds what is possible with transactions recorded directly on the blockchain. Roger Ver is of the opinion that such an incident has never taken place and likely never will.

A collective of programmers supported enhancing Bitcoin's capabilities by introducing advanced technologies on an additional layer instead of expanding the blockchain's built-in features.

Roger Ver believes that for future technologies like the Lightning Network to succeed, the blockchain's ability to scale is crucial. He maintains that the fundamental problems ingrained in the design of the Lightning Network continue to exist and are unlikely to be rectified, regardless of the expertise or time dedicated to the endeavor.

The writer uses concrete analogies, like moving beads on a string, to clarify the intricacies of conducting operations within the Lightning Network. The system's architecture should develop into a framework where key players facilitate a wide range of participant transactions. Ironically, these entities will be readily manageable by governments and established monetary organizations.

The persistent issues with scaling Bitcoin culminated in the establishment of a new cryptocurrency known as Bitcoin Cash.

Ver argues that as the developers' influence over the network waned, it led to a cessation of Bitcoin's growth, a circumstance that contributed to his growing disenchantment with the Core developers and his subsequent support for Bitcoin Cash. The birth of BCH as a novel cryptocurrency signified the creation of a unique coalition that included individuals who create and maintain the currency, those who process transactions, businesses, consumers, and their associated support systems.

The publication provides a comprehensive examination of the fundamental elements and conversations that have influenced the evolution of Bitcoin Cash. The publication details the counterarguments to Bitcoin Core and describes the strategies employed to quell opposing views. Roger Ver argues that Bitcoin Cash remains true to the original vision and foundational principles set forth by the creator of Bitcoin, Satoshi Nakamoto.

Other Perspectives

• The blocksize limit was established as a temporary measure to protect against spam, but maintaining it could also be seen as a way to ensure decentralization, as larger blocks might lead to increased centralization due to the higher costs of running a full node.
• Developers may have limited the blocksize not to hinder growth but to prioritize security and decentralization over rapid scalability, which could compromise the network's integrity.
• High fees and erratic transaction processing during peak times can be viewed as a trade-off for maintaining a secure and decentralized network, which some users may prioritize over low fees and fast transactions.
• Keeping the core layer unchanged could be a strategic decision to preserve the network's original design and security, with the belief that second-layer solutions can effectively scale Bitcoin without compromising its base layer.
• The introduction of advanced technologies on an additional layer, like the Lightning Network, can be seen as an innovative approach to scaling that allows for instant transactions and lower fees, which could eventually lead to broader adoption.
• The establishment of Bitcoin Cash as a response to scaling issues represents one approach to the scalability debate, but it also divides community efforts and resources, which could be seen as detrimental to the overall ecosystem.

The consolidation of authority regarding Bitcoin's development, regulatory environment, and economic motivations.

The section of the book explores the transformation of Bitcoin's oversight from the initial informal control by Satoshi Nakamoto to a more formalized approach under the stewardship of Bitcoin Core developers and Blockstream. The developers led the initiative and held the ultimate power to sanction or dismiss changes to the software, thus altering the fundamental structure of the cryptocurrency network.

In the beginning, the development of Bitcoin faced obstacles due to a lack of monetary backing and structured systems.

Ver asserts that Bitcoin's evolution was a collective endeavor, steered by the pivotal leadership provided by Satoshi Nakamoto. As the initiative grew, addressing matters of professionalization and remuneration became crucial.

The book outlines the foundational steps taken to create a structured entity, which was vital in the development of Bitcoin. The group's intention was to name Gavin Andressen as the "Chief Scientist," offering him a compensation package that would allow him to focus exclusively on the progression of Bitcoin. Unfortunately, the Foundation did not succeed due to multiple challenges and could not secure a consistent means of financial support.

The disintegration of the Bitcoin Foundation resulted in a scenario where a select few programmers took control over the project's trajectory.

Ver characterizes the downfall of the Bitcoin Foundation as a critical juncture, which resulted in the Bitcoin Core developers taking on a more influential position. The collapse of the Foundation resulted in challenges to maintain and retain competent personnel, ultimately resulting in power being centralized in one organization.

The book provides a comprehensive examination of how the administration of Bitcoin has transformed, charting its path from the original creation by Satoshi Nakamoto to the period when Wladimir Van der Laan became the last Core developer to take on the position of lead maintainer. The book further explains the methods by which a select group of developers managed to exert an outsized influence on the evolution of Bitcoin by altering the consensus-building process.

Blockstream's involvement posed a dilemma due to their commitment to constraining the expansion possibilities of Bitcoin.

Ver emphasizes that Blockstream and its investors maintained secrecy about their business plans for a considerable time, a move that attracted considerable attention due to their association with a well-known technological innovation. The "Liquid Network" eventually evolved into the main source of income for Blockstream.

Roger Ver outlines the structure of the Liquid Network, emphasizing its dependence on a centralized authoritative group called the "Federation," and points out that its creation is associated with Bitcoin Core's choice to not enlarge the foundational layer. Blockstream has initiated charges for transactions within its ecosystem and has partnered with financial institutions to create tokens, which diverts activity from the foundational ledger system of Bitcoin.

The individuals responsible for developing Bitcoin Core wielded considerable influence over the course of the network, possessing a disproportionately high level of control.

Ver argues that the Core developers, by implementing temporary measures to prevent spam, altered the essential characteristics of Bitcoin, leading to a variant that neither increased the blocksize limit, expanded the capacity for OPRETURN data, nor augmented the number of operational codes utilized across the network.

Ver puts forth evidence suggesting that the initial creators once recognized the significance of altering the cap on block size. They proposed multiple tactics to increase capacity, but they consistently declined to compromise. They also solidified their control by restricting changes to the software, allowing only those alterations that aligned with their ideological perspective.

They persistently hindered enhancements that were designed to expand the capability of Bitcoin to process more transactions.

Ver presents multiple examples of how the Core developers and their supporters consistently resisted initiatives aimed at increasing the transaction processing capabilities of the network, even though these proposals had broad backing. He narrates the implementation of Replace-By-Fee in Bitcoin Core, a feature designed to dissuade the use of zero-confirmation transactions, despite significant resistance from fellow developers and commercial entities.

The author makes it clear that, even when indications pointed to the contrary, the Core developers often justified their decisions on the grounds that the proposed feature was either too risky or strayed from the fundamental tenets of Bitcoin. The Core developers possessed a strong belief in their ability to improve the system beyond its original design by Bitcoin's founder. They utilized various tactics to keep their actions hidden from the public by sowing doubt, masking the truth, and seeking to modify past documentation.

The creators established a collective agreement system that effectively endowed them with the power to veto any changes.

Roger Ver describes how the Core developers assumed control over changes by emphasizing the necessity for widespread consensus. The discussion focused on the critical need to convince the Core developers, who were at odds with the idea that miners had the authority to determine the network's protocols by altering the software or by expanding the block size.

The author further explores how Core developers used their influence to discourage contributors to Bitcoin Core who possessed different opinions or unique ideas regarding the cryptocurrency's operational features. The stagnation in progress led to collaboration among inventive and dissatisfied developers on alternative projects like Ethereum.

Other Perspectives

• The shift in oversight from Satoshi Nakamoto to Bitcoin Core developers and Blockstream could be seen as a natural evolution of governance as the project matured and required more formal structures.
• The lack of financial support and structured systems in Bitcoin's early days may have actually contributed to its decentralized nature and the organic growth of its community.
• The Bitcoin Foundation's failure might highlight the difficulties of centralizing leadership in a fundamentally decentralized ecosystem, and its collapse could have prevented the concentration of power.
• Wladimir Van der Laan's role as lead maintainer could be viewed as a necessary position to ensure consistency and reliability in the project's development, rather than a consolidation of power.
• Blockstream's involvement and the creation of the Liquid Network can be argued to be an innovation that complements Bitcoin, offering solutions to scalability that do not require changes to the Bitcoin protocol itself.
• The significant control exerted by Core developers over Bitcoin's development may be interpreted as a form of quality control and a defense against changes that could compromise the network's security and decentralization.
• The resistance to enhancements for increasing transaction processing capabilities by Core developers can be seen as a cautious approach to maintain network stability and security.
• The establishment of a collective agreement system for changes in Bitcoin's protocol could be considered a protective measure to ensure that any modifications have broad consensus and do not disrupt the network or its users.

Various social, political, and economic elements influence the shaping of the Bitcoin community.

This section of the text scrutinizes the intensifying efforts to hinder the advancement of innovators and technical experts in enhancing the functionality of the cryptocurrency known as Bitcoin. The Bitcoin community faced subversion through strategies that involved silencing dissent, spreading misinformation, and vehemently challenging proponents of increasing the Bitcoin network's transaction block size. In the end, it became clear that the Bitcoin Core group had assumed command over Bitcoin, leading supporters of the original vision to migrate to a different blockchain.

The Bitcoin community was divided due to differing opinions on the best approach to scale the cryptocurrency.

The debate over the blocksize limit represented more than mere technical disputes; it epitomized a battle for control over Bitcoin's future course. A lasting division among Bitcoin's supporters was caused by differing views on the cryptocurrency's fundamental tenets. The disputes have led to the cryptocurrency industry becoming splintered into various competing projects that depend on additional structures instead of harnessing the full potential of distributed ledger technology.

Ver narrates his experiences with proponents and business founders who supported both the expansion of block size and the preservation of the initial Bitcoin protocol before the split occurred. He sheds light on the driving forces behind the involved groups and reveals that ultimately, many disputes were resolved through psychological maneuvering rather than distinct technological advancements.

Efforts to develop alternatives were stifled through the use of forceful suppression tactics, including the silencing of dissent and the intentional spread of misinformation paired with directed hostility.

Roger Ver provides a comprehensive analysis of the history and progress related to BitcoinXT, the first software to suggest expanding the maximum block size. Efforts to impede its acceptance included a range of tactics such as suppression and orchestrated efforts to tarnish its reputation. The progress faced considerable obstacles when a group of miners, together with businesses favoring increased block sizes, opted not to embrace BitcoinXT.

The book describes how a cohort of influential figures controlled the main avenues of dialogue within the Bitcoin community and simultaneously conducted censorship campaigns. Initiatives like Bitcoin Classic and Bitcoin Unlimited, which aimed to enhance Bitcoin's functionality, encountered comparable forms of resistance. Theymos and Cobra, who managed Bitcointalk.org and Bitcoin.org, used their positions of power to marginalize companies that diverged from the objectives set by the Core developers.

The failure of the Segwit2x initiative underscored the lengths to which proponents of smaller block sizes would go to maintain their sway.

Ver argues that the broad adoption of the "Segwit2x" change, which entailed initially applying Segwit and then enlarging the blocksize limit six months later, unequivocally demonstrated the substantial influence Core exerted on Bitcoin. Although the industry showed considerable backing, Core eventually reversed their stance and hindered the change.

Ver recounts his personal involvement in various conferences where there were attempts to persuade Core developers and those endorsing Blockstream to agree to an increase in the blocksize limit. He recounts the story of how, after attending a conference, Brian Armstrong was struck by the urgent necessity to transform the system, which led him to the conclusion that the Core developers should be succeeded by a completely different group of lead developers. The Segwit2x initiative strived to meet its objectives, yet it failed to secure the requisite backing from the principal architects of the Bitcoin protocol.

The launch of Bitcoin Cash was intended to maintain the original vision of a digital currency designed for direct transactions between individuals.

The book details the rise of Bitcoin Cash as a consequence of the inability to improve Bitcoin's transaction processing efficiency. Though Bitcoin Cash was originally envisioned as a backup plan in case Segwit ended up harming the blockchain, it has since become the main implementation of the original Bitcoin design, including large blocks, minimal transaction fees, instant transactions, and functional smart contracts.

Ver provides multiple examples of how Bitcoin Cash has improved upon Bitcoin's original framework by advancing existing capabilities and facilitating features that were previously constrained by Core developers. The development team behind BCH has consistently made improvements to the system, bolstering its suitability for everyday business transactions.

The founders of BCH rejuvenated the core tenets set by the original cryptocurrency inventor, focusing on expanding block capacities and facilitating the implementation of smart contracts.

The author documents the evolution and incorporation of a variety of improvements and breakthroughs within the underlying code of BCH. The blockchain's ability to contain embedded data has grown due to the expansion of the OPRETURN data payload limit from 40 to 220 bytes. The expanding reach of blockchain technology enables the creation of decentralized applications, smart contracts, and new online services, thus broadening its potential uses.

Ver also clarifies that the removal of the replace-by-fee mechanism in BCH has enhanced the reliability of instant transaction confirmations, thus making it a preferred option for merchants who need quick processing of transactions.

BCH has faced its own governance challenges, including divisive network splits, yet remains dedicated to increasing its capacity through direct modifications of the blockchain's architecture.

Ver recognizes the array of difficulties and internal strife the Bitcoin Cash community has faced, leading to further splits within the BCH community due to several divisive hard forks following its initial split from Bitcoin. Roger Ver argues that the resilience of Bitcoin Cash supporters in the face of adversity highlights their ability to withstand attacks from harmful actors, unlike the difficulties encountered by the Bitcoin Core group.

The author chronicles the progression of each significant divergence within the network, starting with the launch of Bitcoin SV, commonly referred to as "Satoshi's Vision," spearheaded by Craig Wright. The architects behind SV and eCash planned to support their operations using the rewards from BCH blocks, but community resistance resulted in a split into separate blockchains. The BCH community staunchly resists the influential control exerted by those who develop the platform.

Other Perspectives

• The influence of social, political, and economic elements on the Bitcoin community can be overstated, as the underlying technology and market dynamics also play a significant role in shaping the community.
• The division within the Bitcoin community over scaling approaches can also be seen as a healthy debate that is typical in any open-source project, reflecting a vibrant and dynamic community rather than just a battle for control.
• The narrative of forceful suppression tactics can be challenged by the view that in decentralized systems, consensus is key, and the majority opinion will naturally prevail, which may be mistaken for suppression by those in the minority.
• The failure of the Segwit2x initiative can be interpreted as a reflection of the robustness of the Bitcoin governance model, which requires overwhelming consensus for changes to be implemented, rather than a case of a small group maintaining sway.
• The launch of Bitcoin Cash and its adherence to the original vision of Bitcoin can be critiqued on the basis that the original vision may not be suitable for the current and future demands of a global financial system.
• The focus on expanding block capacities and implementing smart contracts with BCH can be criticized for potentially compromising on other important aspects like decentralization and security, which are also core tenets of the original cryptocurrency vision.
• The governance challenges and network splits within BCH can be seen as indicative of the difficulties in achieving and maintaining consensus, which is a fundamental challenge for all decentralized digital currencies, not just Bitcoin Cash.