The resolution of the Bitcoin experiment | Mike Hearn

Mike Hearn; The resolution of the Bitcoin experiment; On Medium; 2016-01-14.

tl;dr → 4500 words. The Bitcoin culture is & was corrupt.  Now it is failing.  The technology “doesn’t scale” anyway. The long con is folding up.  Mike Hearn exits, stage left.


  • age, 31,
  • R3
    • <quote ref=”NYT“>currently “on salary,” Andreessen Horowitz; towards Bitcoin development</quote>
    • <quote ref=”NYT“>R3, is developing Bitcoin-like networks for banks to enable cheaper and faster ways to trade assets of all sorts. The start-up aims to take advantage of the less-centralized record-keeping methods of Bitcoin, but still allow for someone to be in charge, to handle the software and to manage access to the system.</quote>
  • ex-Google, Google aps
  • degree? Durham University, England
  • grew up in Manchester, England,


<quote ref=”Mike Hearn“>

Think about it. If you had never heard about Bitcoin before, would you care about a payments network that:

  • Couldn’t move your existing money
  • Had wildly unpredictable fees that were high and rising fast
  • Allowed buyers to take back payments they’d made after walking out of shops, by simply pressing a button (if you aren’t aware of this “feature” that’s because Bitcoin was only just changed to allow it)
  • Is suffering large backlogs and flaky payments
    • … which is controlled by China
    • … and in which the companies and people building it were in open civil war?

I’m going to hazard a guess that the answer is no.


<quote ref=”ProHashing“>

Some customers contacted Chris earlier today asking why our bitcoin payouts didn’t execute …
The issue is that it’s now officially impossible to depend upon the bitcoin network anymore to know when or if your payment will be transacted, because the congestion is so bad that even minor spikes in volume create dramatic changes in network conditions. To whom is it acceptable that one could wait either 60 minutes or 14 hours, chosen at random?

It’s ludicrous that people are actually writing posts on reddit claiming that there is no crisis. People were criticizing my post yesterday on the grounds that I somehow overstated the seriousness of the situation. Do these people actually use the bitcoin network to send money everyday?


  • Bitcoin
  • Developers
    • a.k.a. The Good Guys, who support the block size increase, Bitcoin XT
    • The Bad Guys, who do not support the block size increase, Bitcoin Core
    • The Fantastic Guys
      • Satoshi Nakamura
        The Ghost of Christmas Past, The Shower of The Way, The Savior & The Man Who Never Was
  • Bitcoin Core
    The software that you have to run to participate.

    • contra Bitcoin XT
    • Bitcoin Core v0.12
      • transactions are reversible
      • transaction fees can be added after the transaction is recorded.
      • transaction clearing fees; <quote>higher than credit cards<quote>
  • Bitcoin XT
    • achieved 15% adoption
    • contra Bitcoin Core
  • Factoid
    • Mining blocks is paid 25 BTC ~ $11,000 USD
    • Conversion rates (various days)
      • ₿1 BTC = $325 USD
      • ₿1 BTC = $440 USD
  • Coinbase
  • Governance, Community Processes
  • Componentry
    • libconsensus
    • Bitcoin Core
    • “the node software”
    • The Bitcoin Consensus
  • Attacks
    • Bitkiller
      • “a hacker”
      • Russie
    • <quote>entire datacenters were disconnected from the internet until the single XT node inside them was stopped. About a third of the nodes were attacked and removed from the internet in this way.</quote>
  • Promotions
    a.k.a. <quote>The Bogus Conferences</quote>

  • Scandals
    • Mt. Gox
    • other embezzlement and pump & dump scams.
  • Alternative Bitcoin
    • Bitcoin XT (Mike Hearn & ilk)
    • Bitcoin classic
    • Bitcoin Unlimited


  • Satoshi Nakamoto created Bitcoin, then disappeared [not died, killed, or disavowed, but he disappeared; c.f. indeed, the Monomyth]


  • <quote>When Satoshi left, </quote>




  • 2015-12 → Scaling Bitcoin, Hong Kong
  • 2015-08 → Scaling Bitcoin, Montreal
  • 2015-08 <quote><snip/> due to severe mismanagement, the “Bitcoin Core” project that maintains the program that runs the peer-to-peer network wasn’t going to release a version that raised the block size limit.</quote>
  • 2015-05 → Gavin Maxwell begins arguing against raising the limit, in his blog; c.f. , Time to Roll Out Bigger Blocks


Mike Hearn, using the self-asserted identity token @octskyward, on Medium.


In order of appearance, duplicates removed & some sources coalesced.


Exhibit: A graph of the timeline 2014-10-01 → 2016-01-01

  • yellow, right → bytes, block sizes
  • blue, left → XBT, transaction value

Exhibition: 95% of bitcoin mining capacity is <quote>a handful of guys sitting on a single stage</quote>. in Hong Kong, at Scaling Bitcoin, 2015-12-06.

Source: Gavin Andresen, New York Times (NYT)


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