Oh my Satoshi
Myths
Myth of store of value
Myth of decentralisation
Myth of scalability
Myth of Slow confirmation times
Myth of Anonymity
Myth of wasteful mining
Myth of DLT
Myth of Bitcoin as a voting system
Myth of Yap Money
Myth of store of value
Bitcoin. It is not about attacking banks. Very simply, it is a cash-based system that works over the Internet. It is not about replacing intermediaries or what they call trusted third parties; the difficulty with trusted parties is that they increase the minimum level of exchange, which is what Bitcoin solves. Is not digital gold, and it is not an anonymous money source that allows people to buy illicit goods.
The purpose of Bitcoin was very simple and focused: Bitcoin is an ordering and timestamp system that allows for the creation of digital cash in a manner that is efficient and effective. Unlike monetary systems based on a trusted third party, Bitcoin can enable transactions that act as cash and that can be as small as a thousandth of a cent.
Cash is not and was never designed for making multibillion dollar payments. They are possible with Bitcoin, but are not desirable outside of a few criminal activities. And even so, when criminal actors come to understand the nature of Bitcoin, they will come to understand that Bitcoin is not good for criminal activities. Bitcoin works best as a system that allows very small transactions and small casual transactions, such as ones that would be seen over a micropayments application on the Internet. The banking and credit card models don’t work for accessing small casual services. Bitcoin will.
Myth of decentralisation
In this, the false idea that all users are required to run a node was promoted to mislead users and people interested in Bitcoin.
The nature of Bitcoin is such that once version 0.1 was released, the core design was set in stone for the rest of its lifetime.
There is a completely false narrative that you do not hold bitcoin and that they are an intangible distributed across many machines around the Internet. It is utterly wrong. Individuals hold their own bitcoin. Bitcoin is merely a digital token, and the digital token is never distributed on the blockchain itself. The blockchain acts as a transaction record and log, recording the control and movement of the tokens and allowing the nodes to verify and control the property rights associated with each of the tokens under the rules of the system, which incorporates law.
Myth of scalability
This is the biggest myth around bitcoin. The only problem with scalability is the subsidising of home user hobby nodes. Bitcoin can scale to terabyte size blocks today. The only thing stopping this is a false idea that nodes that do not mine bitcoin are required in the network. Miners are competitive organisations.
Myth of Slow confirmation times
The confirmation times within bitcoin are fast. People confuse confirmation and settlement. A transaction that has not been settled within a block is secure enough. It does not need to be impermeable, it needs to be good enough.
Myth of Anonymity
Bitcoin is purposely pseudonymous. There is a fine line between privacy and anonymity and it is a line that cannot be crossed. What few understand is that anonymity is not privacy. Anonymous transactions do not help the average person, they help corrupt governments and criminals. Worse, anonymous systems will never be legally enforceable. This undercuts their key use as monetary systems and as a method of exchanging contract.
It has always been the sunshine principal that allows us to detect fraud and dishonest dealings. A system of anonymous money allows those in organisations such as Enron to expand operations in a manner that allows them never to be caught. Anonymous money allows governments to buy deals, votes, guns and more with impunity. It is not anonymity that leads to free and open exchange but pseudonymous and private communications.
Privacy is important but anonymity isn’t. Anyone who does not understand this should read Plato’s Ethics, and in particular, the Ring of Gyes
Myth of wasteful mining
The value of bitcoin is not the electricity in the system, it is that value in exchange and people are willing to pay for this using electricity in mining. There are no absolutes in the economic world and this holds true for bitcoin.
The question to always ask is not whether something uses energy but rather does it deliver an outcome that people want more efficiently. Bitcoin delivers the first form of stable money ever developed in human history and it does this at a cost that is lower than the combined cost of monetary issue, electronic data exchange and fiat money as they exist today. As an economic system bitcoin self adjusts in mining and fee reward based on the overall utility of the system. Most importantly, as the system scales it becomes more and more efficient.
At a global scale, the system can operate more effectively than the credit card system alone while delivering far more.
Myth of DLT
Property and Bitcoin
Bitcoin is falsely called a distributed or decentralised cryptocurrency because of the ledger. Yet, it presents a misleading understanding and description of Bitcoin. Bitcoin is a peer-to-peer token exchange system that can be used as a form of digital cash. As with all token systems, a token can represent any value and reference any agreed property or item.
Bitcoin is not distributed across a ledger. Bitcoin is held by the individual controlling it, who generally would also but doesn’t need to be the owner. Your bitcoin is not held in the ledger. Your bitcoin is held in your wallet or related application. The ownership of any set of tokens remains with an individual or group (including a company), and is not distributed.
Myth of Bitcoin as a voting system
Many people have failed to read my white paper and assumed that Bitcoin is a voting system that allows rules by consensus where every individual has a vote.
Bitcoin, in fact, any blockchain-based system, is anti the vote by the masses. There is no way to create rules by consensus across individuals in any blockchain. Bitcoin was never designed as a demagoguery, it is designed as a commercial system where the nodes, the generals, are visible and the amount of resources they invest and the level of their effectiveness may be publicly validated.
Myth of Yap Money
Yap money is new actually
These stones only started after the Steel ships came
The myth is utter bs.
The yap stones are a creation of the late 19th C
If you read the logs of the original explorer of the region,
you see they are in the order of 20 kg
Yapp money is crap
it is 19th-century and didn't exist before then
and that whole fucking story is bullshit
These are all post-European stones.
The yap stones are a creation of the late 19th C
When 1st encountered in the 1840s stones where described as
"very rare" and hand sized.
The interest expressed by Europeans led to the Yap islanders
creating what the traders demanded.
This was inflationary and 13,281 large stones by 1929
They DID carry then in cannoes. Many at a time.
Then, the British banks came with steamers
5kg vs 15000 kg
Sources:
Kirwin, Harry W. "American Far Eastern Policy in the Western Pacific Area, 1917-1921." PhD diss., Fordham University, 1945.
Hobbs, William Herbert. "THE ISLAND OF YAP AND ITS PEOPLE." Current History (1916-1940) 15, no. 5 (1922): 762-769.
~ Craig S Wright
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