Michael Saylor and Craig Wright agree on Bitcoin

BTC devotee Michael Saylor seems unlucky to buy BTC with MicroStrategy. But to the surprise of many, Saylor recently said something that Dr. Craig Wright has been preaching for years already.

In a discussion with Not Investment Advice, Saylor said that Bitcoin should not change. This is fascinating because BTC maximalists tend to be open to tampering with the protocol as they please.

Michael Saylor said:

“You can’t keep changing the protocol. That’s the problem. If you change the protocol, you probably instantiated a security. And now the problem is: if it is a security, you are trading it illegally on unregistered exchanges without a license to trade a security, and you have not disclosed all the risk factors of the security. So it doesn’t work like money.”

Wise words from @saylor that you cannot continue to change the protocol pic.twitter.com/Et78SGgBko

— LIAM (@1liamchai) 31 July 2022

Sounds a lot like the decades-old and famous Satoshi Nakamoto quote about the nature of Bitcoin:

The nature of Bitcoin is such that when version 0.1 was released, the core design was set in stone for the rest of its life.

So now in 2022, Saylor is adamant that Bitcoin will not change. Dr. Craig Wright mentioned all of this publicly since at least 2018:

Dr. Wright is way ahead of the curve and always has been. Why is Dr. Wright so in his place? Well, he is Satoshi Nakamoto, the inventor and creator of Bitcoin. The outcome of the Kleiman v. Wright trial made this very clear. Further information can be found in the history of how Bitcoin was stored.

Dr. Wright has been consistent in what he has publicly stated about Bitcoin as evidenced by his comments in 2014 until now in 2022. Dr. Wright does not advocate changing the Bitcoin protocol and has been very consistent with his own statements regarding Bitcoin being set in stone which makes it decentralized. Consistency, trust – much like the blockchain itself.

Regulatory Reasons Not to Change Bitcoin

Saylor is correct in saying that the change of Bitcoin means that Bitcoin can be a security. We don’t want that, but not for the reasons Saylor stated. He just seems concerned that BTC can no longer be traded on unlicensed exchanges due to being a security.

The original Bitcoin – today known as Bitcoin SV (BSV), the BSV blockchain – is not a security. It is an information product.

A commodity is a standardized good. If we recognize bitcoins, the individual satoshis are themselves commodities that can be used for something; We do not have an item yet. Only when the single satoshis are standardized can they be a commodity.

Are they standardized? Well, it depends. In BTC they are not, as BTC has been changed a lot from what Bitcoin originally was and will probably be changed in the future again and again. So there is no standardization in BTC, which means that BTC is not a commodity. Saylor’s fear of BTC being perceived as a security is for this reason, whether he knows and understands it or not.

With BSV, however, the Bitcoin white paper is followed. This means that the rules in the Bitcoin White Paper are set in stone foundations. Therefore, BSV satoshis can really be commodities – commodities that are standardized, not securities.

Contractual perspective on Bitcoin change

Saylor is only scratching the surface. He understands that changing Bitcoin means that Bitcoin is no longer Bitcoin. That is what we have seen with BTC. For example: when Segregated Witness (SegWit) was implemented in BTC, it was against the Bitcoin White Paper. Therefore, since the day Segregated Witness was implemented, BTC is no longer Bitcoin.

Given the fact that Bitcoin is bound under contract, a change to the protocol has legal implications. Satoshi Nakamoto issued all Bitcoins, and these Bitcoins are now being distributed – from the miners to the exchanges and on to the users. In his article “Forking and Passing Off,” Bitcoin inventor Dr. Craig Wright – stated:

Bitcoin has an issuer. In January 2009 (…) I issued 21 million bitcoins, where each individual bitcoin is an indivisible set of 100 million tokens. To distribute tokens (…), I set up a contractual arrangement where nodes (which many call miners today) operate within a set of common rules that I defined.

Any change in the protocol means that a new contractual offer is drawn up. BTC is not the original unilateral contract offering that Satoshi Nakamoto brought to the world.

If you want to know what BTC is, ask the creators of BTC – BTC developers, BTC miners, BTC influencers, BTC promoters, BTC dedicated exchanges, and so on. Ask them what kind of unilateral contract offer they have in store for you. Since they are changing the BTC protocol and even discussing removing the 21 million coin cap on BTC, you will find that there is no solid contractual offer behind BTC.

Fun fact: if you’ve changed Bitcoin to BTC, you’ve created a new blockchain project and a new coin. Therefore, you are responsible and have issued BTC at an extremely high value. Consider paying tax on that issue. On the contrary, Satoshi Nakamoto issued the original Bitcoin when Bitcoin had no value. But to understand what this means for BTC, watch this video:

Financial reasons to never change Bitcoin

Saylor should also focus on the financial reasons for not changing Bitcoin and not just worry about whether BTC can be traded on unlicensed exchanges. As noted economist George Gilder said in an interview with the Hoover Institution:

A low-entropy carrier is required to carry high-entropy information. (…) To carry (…) a surprisingly creative signal, you need a predictable carrier.

What you want in economics is predictable laws, predictable political leadership, a spirit of trust that means a contract can be predictable. Property rights, which means that property rights do not change from time to time. That entrepreneurs can launch their creation through a world governed by predictable legal rules (…).

We want Bitcoin as a predictable carrier to allow surprisingly creative signals to occur on it. Therefore, Bitcoin must remain unchanged, otherwise no one can predict the future of Bitcoin as its foundation. Without predictability, no construction would happen on and with Bitcoin.

George Gilder is a Bitcoin SV (BSV) advocate, by the way, also stated:

Satoshi’s vision is now manifested in a transaction level that dwarfs that of BTC. Everyone is focused on the market value of Bitcoin (…), but you advance by inventing new things, using money as a measure of your own achievements. And Bitcoin SV is now taking off in the transaction field.

Saylor should take a few hours and listen to everything George Gilder said at various CoinGeek conferences in the past. Gilder literally described Bitcoin SV – the BSV blockchain – as the epitome of the information economy.

If Saylor follows this lead, he may find himself agreeing with Dr. Craig Wright more and more in the future.

New to Bitcoin? Check out CoinGeeks Bitcoin for beginners section, the ultimate resource guide for learning more about Bitcoin – as originally envisioned by Satoshi Nakamoto – and blockchain.