Contents
- Bitcoin (BTC) was centralized without formal governance
- Is Bitcoin (BTC) Progress Really “Whale-Dominated”?
Explained by Cyber Capital CIO
Vladislav Sopov
Justin Bons, CIO and co-founder of Cyber Capital, the oldest European digital asset management company, once again raises concerns about the centralization of Bitcoin (BTC)
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Bitcoin (BTC), the largest cryptocurrency, has never had a CEO or a formal management company overseeing its development. At the same time, it remains vulnerable to centralization and “conflicts of interest”, says an experienced cryptocurrency researcher.
Bitcoin (BTC) was centralized without formal governance
Despite lacking formal governing institutions and leaders, Bitcoin (BTC) became “extremely centralized” over the past few years, argues Justin Bons, CIO of Cyber Capital. Bitcoin Core members are those who have too much influence on decision-making in Bitcoin (BTC) development.
Bitcoin Core achieved this “unhealthy” level of influence by effectively holding back any rule changes they oppose. In particular, they managed to “crush” a number of use cases related to fungible and non-fungible tokens (NFT).
Blockstream and Chaincode Labs are the two companies that benefit the most from the current status quo. They control the majority of developers contributing to Bitcoin Core, Bons added.
Moreover, they can use their influence to suppress the progress of Bitcoin (BTC) as L1 to accelerate the adoption and promotion of their proprietary development:
Blockstream & Chaincode Labs are the two biggest companies behind Core. The crazy thing is that these companies are developing for-profit L2 solutions, which gives them a clear conflict of interest when it comes to scaling L1.
As covered by U.Today earlier, Justin Bons highlighted that Bitcoin (BTC) security may be on borrowed time as the “budget model” is doomed to collapse in 5-9 years.
Is Bitcoin (BTC) Progress Really “Whale-Dominated”?
The process of Bitcoin (BTC) development is coordinated by Bitcoin Core, an independent team that maintains and releases the eponymous Bitcoin (BTC) client software. Although unable to partner with any for-profit directly, some firms may “sponsor” this or that Bitcoin (BTC) developer with a one-year grant.
In February 2023, the Wall Street Journal published an alarming longread about painful processes in Bitcoin Core. At least three developers resigned after Wladimir van der Laan, its longtime lead maintainer, stepped down.
In total, over 300 developers are active in Bitcoin GitHub repositories. But as veteran developers leave their roles one by one, it becomes easier to control those who remain in charge of the Bitcoin (BTC) codebase.
