10 Years of the Blockchain: What Is Bitcoin, Really?

The Bitcoin white paper was released into the world 10 years ago today, so we asked some influential people in the space—including the guy who spent 10,000 bitcoins on pizza in 2010—what it is and where it's going.

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Oct 31 2018, 2:00pm

Illustration: Getty Images/smartboy10

It’s been 10 years since someone going by the pseudonym Satoshi Nakamoto posted the white paper describing Bitcoin to a cryptography mailing list, and we are all very tired.

Whether you like it or not, the original cryptocurrency is a part of most of our lives now. If you’re not an ultra-libertarian net warrior yourself, then you’ve probably been exposed to someone babbling about blockchains at a party, or at a coffee shop, or on the news, or, god help you, around the dinner table. Even people who’ve never heard of Bitcoin can be affected by it—say, in the towns where the industry’s intense energy needs have suddenly become everybody’s problem.

With all of this loud, overlapping yammering around Bitcoin—and if you’re reading this and don’t know the basics, check out Motherboard’s primer—it can be easy to forget that there are some very basic questions about it that still haven’t been answered, or at least borne out with time. For one, what is it?

There have been many answers to this questions over the years, and many of them directly compete. Is Bitcoin cash-like money, or is it a long-term investment more akin to gold? Is it a scam? Is it a premature relic, a failed experiment already surpassed by technologies with more bells and whistles like Ethereum? Is it a tool for tracking the ownership of things like land or goods? Is it an exit from the current financial system or a way to entrench it? Is it a “blockchain” or a glorified database, and hey, while we’re at it, what is a blockchain anyway? You get the idea.

"A triumph in social engineering and grass-roots activism. A meme. A sociotechnical experiment. The world’s greatest multi-level marketing scheme. It’s many things to many people"

For my money, Bitcoin is for sure at least one thing, whether you love it or hate it with a burning passion: it’s interesting. And as a merely interested party (I don’t own any bitcoins), I figured the best way to put the dizzying array of perspectives on Bitcoin into, well, perspective, was to ask a bunch of people who’ve been involved with Bitcoin or cryptocurrencies for a long time the deceptively simple question: what is Bitcoin? For good measure, I also asked where they thought it was going.

I got responses from long-time developers (including one who famously declared Bitcoin a failure in 2016), a policy analyst, the guy who spent 10,000 bitcoins—now worth more than $60 million—on pizzas in 2010, one former YPG fighter, and more. Their answers ranged from describing Bitcoin as a meme, to a store of value like gold, to online cash, to a method of financing anti-state activities, to an illustrative but ultimately failed experiment.

Most, though, said that they still believe in Bitcoin as being money of some sort, although there are disagreements within that broad characterization. As for where it will go next, well, that’s even less clear. Read their responses below.

Andrea O'Sullivan
Image: Andrea O'Sullivan

Who: Andrea O’Sullivan
What: Co-author of Bitcoin: A Primer for Policy Makers and feature writer at the Mercatus Center

What is Bitcoin?
Same as it ever was: A censorship-resistant network and currency that can be transferred directly among parties without the need to rely on an intermediary.

Where is it going?
I hope it becomes something that anyone in the world can easily use to protect their economic autonomy. Given the quality of projects and people that are working towards this goal, I am more optimistic about this than I am about basically anything else.

Mike Hearn
Image: Mike Hearn

Who: Mike Hearn
What: Former Bitcoin developer, declared it a failure in 2016, now working on the Corda project

What is Bitcoin?
Although Bitcoin didn't become the popular currency for payments us early developers hoped for, its impact on the world has been enormous anyway. It introduced hundreds of millions of people to the idea that currencies could be created by volunteers and the private sector, which is a solid step towards a more libertarian, capitalist society.

Where is it going?
I can't see it recovering from the years of censorship and stagnation it has suffered from—we learned a lot about what works and what doesn't, and that'll be its primary legacy.

Meltem Demirors
Image: Meltem Demirors

Who: Meltem Demirors
What: Investor, currently Chief Strategy Officer at CoinShares

What is Bitcoin?
A triumph in social engineering and grass-roots activism. A meme. A sociotechnical experiment. The world’s greatest multi-level marketing scheme. It’s many things to many people.

Where is it going?
It’s going to be what it has always been—open source money. Utilization will grow by push and pull. We’ll push Bitcoin to users by building truly delightful user experiences and applications—I see those being built, albeit slowly. And on the pull side, there will be groups of people who seek out Bitcoin, who are willing to overlook the current limitations and the learning curve because it’s a matter of life and death for them. Choice is an incredibly powerful and sometimes destabilizing force.

Amir Taaki in the YPG
Image: Amir Taaki

Who: Amir Taaki
What: Bitcoin developer, former YPG fighter

What is Bitcoin?
Bitcoin is more than an exit from the system, it's a powerful financial tool. Satoshi's first website said "Bitcoin is a form of p2p money that cannot be controlled by governments and central banks". I still abide by this vision. It is simultaneously a unit of account, means of exchange, and a store of value. The system follows libertarian principles of mistrust of central authorities, instead being about popular control over the financial system. Bitcoin is for counter-economic black markets and funding non-state sanctioned movements. Bitcoin is global and uncensored.

Where is it going?
Bitcoin has failed to materialize the early optimism because the community is unable to critique itself, and modify its course of action, rearranging its structure to be more effective in organizing.

This will unfortunately be the thing that kills Bitcoin, not some outside threat as the community is currently unable to organize effectively to take advantage of the opportunities in the market to spread the potential or ideas of Bitcoin. I still think the system has massive potential but this can only be capitalized on with a radical change in the root of the community.

Jimmy Song
Image: Jimmy Song

Who: Jimmy Song
What: Bitcoin developer, author of the upcoming Programming Bitcoin

What is Bitcoin?
Censorship resistant self-sovereign store of value.

Where is it going?
Bitcoin is headed towards being the main money that's not controlled by the state. This means it will become the store of value much like gold was in the late 1800s. Eventually it will also become a method of payment and unit of account, but not until it's first established as store of value.

Charlie Shrem
Charlie Shrem in 2013. Image: cshrem/Wikimedia

Who: Charlie Shrem
What: Entrepreneur, Bitcoin-related felon, co-founder of CryptoIQ

What is Bitcoin?
This is the most vital aspect of Bitcoin and cryptocurrency in general: its role in bringing personal power to everyone who uses it. What Satoshi did when he democratized money was hand every individual alive—and generations to come—vast personal liberty.

Where is it going?
This shift in power from the few to the many equals events in history like the advent of democracy itself, the invention of the printing press, and the Renaissance. But nothing is free. What we gained in liberty with Bitcoin, we lost in the security of knowing someone else was responsible for protecting our money. Which would you rather have?

Anthony di Iorio
Image: Anthony Di Iorio

Who: Anthony Di Iorio
What: Co-founder of Ethereum, CEO and founder of Decentral and Jaxx

What is Bitcoin?
Bitcoin is one of many cryptocurrencies that has morphed from a cash for the internet and cheap way to interact to a storing of value. Projects that have spawned from Bitcoin provide many solutions that are not just for cash systems but that will disrupt all sectors in a way that the internet disrupted information. Bitcoin is the most tried-and-tested of the cryptocurrencies. It has a large first mover advantage but it is definitely not as advanced as new technologies that are emerging.

Where is it going?
I’m not sure where Bitcoin is going. There are a lot of possibilities. It has a chance of leading the way or becoming obsolete, only time will tell.

1540934747595-Screen-Shot-2018-10-30-at-52532-PM
Image: Laszlo Hanyecz

Who: Laszlo Hanyecz
What: Introduced GPU mining for Bitcoin, spent 10,000 bitcoins now worth more than $60 million on two pizzas in 2010

What is Bitcoin?
Bitcoin is a tool that allows everyone to take control of their money. Using Bitcoin, people can trade without having to get permission from anyone else and if they're careful about it, nobody ever has to know that they traded. Bitcoin is final, there isn't an easy way to reverse a transaction and fraudulently take back your money after a successful trade. Bitcoin is scarce—there isn't some easy way to print more and devalue it (software bugs aside). Bitcoin has no borders—it works across the world.

Where is it going?
Bitcoin might just become the next form of money. Aside from the censorship resistance and [the] scarcity of it, it's also very convenient as a money of the internet, something where credit cards currently dominate.

These responses have been edited for length and formatting.

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