Bitcoin Gravity – The Nature of Bitcoin and the Reasons Why It Is More and More Popular

Bitcoin has different meanings for different people. No matter what it is for you, it undoubtedly triggers a phenomenon that carries the polarization of ideas. There are certain ideas in the nature of Bitcoin that you may be interested in some or all of them.

The invention of Bitcoin and its underlying blockchain technology were widely interpreted, spawning many blockchain projects, networks and communities. Some of these blockchain networks compete directly with each other, which leads to endless conflicts and a lot of controversy. The root of these conflicts is essentially the difference in ideology, that is, the disagreement about what the world looks like and what it should be. This is a divergence of ideas.

In the following, the author will attempt to explain some of the reasons behind this polarization, explore the dynamics behind it in more detail, and explain why more and more people are attracted to Bitcoin.

Identify a set of ideas

The goal of the Bitcoin network is to reach a consensus, that is, to reach a general consensus on the state of the system. Bitcoin's breakthrough innovation is to use its unforgeable costliness to reach a global consensus without relying on central authority.

Bitcoin can be understood as a game that anyone can join. Just like all games, this game can only be played when it has rules and some inherently consistent ideas. Otherwise, this is not a game, it will be a mess.

"Before playing any game, the rules must be established; before the game is changed, the rules must be clear…. Anyone who understands the rules and accepts the rules can play the game without having to fight for the rules of the game. This will bring Peace, stability and potential prosperity – this is a good game. However, a good game means better games, and a more attractive game may always exist." – Maps of Meaning

• The currency was ambushed by hackers, and $41 million was missing.
• Babbitt Watch | Bitcoin Community: Roll back when you are stolen, do you want us to be Ethereum?
• The currency wants to roll back Bitcoin, which is essentially a hegemonic thinking.

Bitcoin's consensus rule is a set of ideas, a set of coded validation rules that are executed by nodes in the network. Changing these core ideas is like changing Bitcoin, and the decentralization of the Bitcoin network makes it extremely difficult to change these ideas. Because there is no central authority to direct these changes, it is almost impossible to agree to adopt a new set of ideas.

Anyone who changes the rules, even if he thinks such a change is better, means that he will start playing a different game, and only those who join him will play this new game with him.

As Ben Teng, the inventor of Bitcoin, once said, the essence of Bitcoin is that once the 0.1th edition is released, its core design is fixed and remains the same throughout its life cycle.

There is no doubt that Nakamoto has some ideas when creating Bitcoin. These concepts are reflected in Nakamoto's article (https://satoshi.nakamotoinstitute.org/) and even in the Bitcoin Creation Zone. Most importantly, however, his core philosophy has been incorporated into Bitcoin's consensus rules:

• Fixed supply
• No central point of failure
• There is no possibility of being expropriated or reviewed
• Anything can be verified by anyone at any time

This set of ideas is embedded in the Bitcoin network rules, and users must adopt these ideas in order to participate. In essence, a network like Bitcoin encodes a social contract in its software, a common idea that everyone on the network agrees with.

Communication concept

All great things start with small things, and Bitcoin is no exception. In the beginning, it was just a node, a piece of software, a person, a set of ideas. On October 31, 2008, the Bitcoin White Paper was released. Two months later, on January 3, 2009, the Bitcoin founding block was dug up. Nakamoto wrote in the founding block:

“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.” (Translation: The Chancellor of the Exchequer is on the verge of implementing the second round of bank emergency assistance on January 3, 2009)

Just two days later, a second person was attracted to the Bitcoin network: Hal Finney ran the software and connected it to Nakamoto's node, so the Bitcoin network was born. Soon, others accepted the idea, ran the software, and set up their nodes to join the Bitcoin network.

The Bitcoin network is a complex mechanism. The network consists of a combination of people and technology, making it difficult to describe and understand the network itself. Although the following figure does not fully describe the system, the authors believe that some of the components are useful in more detail: ideas, people, codes, and nodes.

Part of Bitcoin

At the physical layer, the bitcoin network consists of interconnected nodes. Bitcoin's consensus rules are contained in its software (that is, the code that runs on the network nodes). The software that people ultimately choose to run is determined by the ideas they hold.

Part of the reason that Bitcoin's consensus rules are difficult to change is that users can run nodes with self-sovereignty. As mentioned above, in a bitcoin network, there is no central authority and no entity that can be trusted (the bitcoin network is trust-free). Any change in consensus rules must be voluntarily received and adopted by each participating node. People are free to run any version of the software, whether it's out of faith, laziness or contempt.

According to the Bitcoin White Paper, Bitcoin is a system based on cryptographic proof rather than trust. This means that you are the authority yourself, you have to verify everything for yourself from scratch. Consensus will arise from this.

“Freedom makes people rude and directly responsible for their own free behavior.” — Frank Meyer, Defending Freedom

Once a consensus is reached in the Bitcoin network, value comes into play. Bitcoin (or any kind of currency) If you want to have value, it is itself a concept that needs to be convinced.

For Bitcoin, this process took nearly 500 days. Bitcoin is worth nothing when the network is still in its infancy. Bitcoin was dug up by some curious punks and sent back and forth between them.

However, on May 22, 2010, Bitcoin made its first physical transaction, and programmer Laszlo Hanyecz bought two pizzas using 10,000 bitcoins. In an instant, the Bitcoin network becomes valuable in a tangible way.

Since then, the "idea-value feedback loop" described below has come into play:

1. The idea of ​​Bitcoin – its value proposition – is beginning to attract people;
2. These people are free to choose which code to run;
3. The selected code runs on the node, specifying the behavior of the node;
4. Nodes join the network and connect with groups of users who share a common philosophy;
5. The network reached a consensus and agreed on who owns what;
6. Value in turn reinforces this set of ideas defined by consensus rules: it carries its value proposition.

Idea-value feedback loop

This "ideal-value feedback loop", which enhances ideas through value creation, is the mechanism behind bitcoin gravity. Everything in this cycle of cycles affects everything else — whether it's software, hardware or wet parts (ie the human brain). This cycle eventually caught and attracted people, and in fact, because Bitcoin's core philosophy is fixed, it has some surprising effects on people's ideas.

Bitcoin created "gravitational well"

As we saw above, Bitcoin is a software with a set of ideas that creates a network with this concept. The impact of this network of ideas is that it attracts a group of people who agree with their ideas.

It can be said that most early adopters of Bitcoin have a core philosophy in common with it. As Dan Held pointed out in his article "Planting Bitcoin," Nakamoto carefully selected the original group of people: cryptographers and password punks, who understood the technical components of Bitcoin.

There are many factors that get people close to Bitcoin and attract them: you may be interested in cryptography, information security or financial technology; you may hold certain political or economic beliefs; you may be a gold beetle (golden investor) An advocate of freedom of speech or a speculator. You may need to use Bitcoin if necessary.

No matter what your initial contact with Bitcoin is, there is a certain possibility that you will be attracted. Nakamoto referred to this multi-dimensional appeal in an email to his cryptographic mailing list:

"If we can explain it correctly, this is very attractive for liberalism. But I am more at the code than the text." – Satoshi Nakamoto

One way to illustrate Bitcoin's multi-dimensional appeal is to visualize ideas. Since the actual number of all possible ideas is infinite, we will have to pay attention to one of the small subsets. Since we are talking about bitcoin, we will focus on the small universe created by the question "what is bitcoin?"

"What is Bitcoin?"

Ask three strangers what bitcoin is and you might get three very different answers. Any answer must be influenced by their respective past experiences, political and economic beliefs, and personal understanding of the world. Your personal ideas/thoughts, your worldview, determine your position on the concept map.

One person may think that Bitcoin is primarily digital gold, focusing on the value storage aspect of Bitcoin; another person may think that Bitcoin is a payment system that focuses on the exchange medium of Bitcoin; and a third person may think that Bitcoin is A way to automate more complex social structures that focus on contract automation and some similar ideas.

These ideas, these ideas, (partly) describe what Bitcoin really is and also describe what we "think" about it. As we understand the system and the development of the system itself, these ideas will inevitably evolve over time. Whether it is ideas, people, bitcoin, or the whole world, it is not static. Our views on Bitcoin have changed and will continue to change in the future.

The gravitational well created by Bitcoin

Therefore, Bitcoin attracts people with the same ideas and ideals. As the saying goes, "Things are gathered together, people are divided into groups." In this case, it is not surprising that many computer fans and password punks gather around Bitcoin very early.

Surprisingly, however, Bitcoin, the extra effect of a network of ideas, affects people's ideas. Since the core concept of Bitcoin is fixed, the concept that people hold must be consistent with Bitcoin. The past decade has proven that Bitcoin is very effective in changing people's minds. However, so far, no single idea has changed the concept of Bitcoin particularly effectively.

Reiterating the old saying used by Tales from the Crypt podcast: Bitcoin will change us more than we change it, and that's what I know.

Attraction and exclusion

So what if your idea doesn't overlap with bitcoin? If you want to change the concept of Bitcoin, don't think it's a futile attempt, what should you do? What if you completely reject some of its ideas?

“The physical miracle I am talking about here is actually known since the Einstein era of general relativity; gravity (gravity) is not always attractive. Gravity can also act as a repulsive.” – Alan Guth

If you reject the idea of ​​Bitcoin, you may end up drifting into space and into interstellar space, where people who don't hold bitcoins float around.

If you want to fundamentally change the concept of Bitcoin, you may end up creating another gravity well. This is easy to implement due to the open source nature of Bitcoin. Its open source, unlicensed network structure, and no formal organization of any kind allows anyone to copy, modify, and run their code without requiring permission.

As mentioned above, changing the core rules of Bitcoin creates a new game, a game that is different from everyone else. In order not to let yourself play this new game, you must convince others to play with you. If you want to play with as many people, you must make everyone on the web believe that your ideas are better than others. Since this is primarily a financial game, a powerful network effect is very beneficial; persuading everyone will bring you the most benefit .

If you can't do this, you'll create a competitive system, whether it's creating a new network or getting away from an existing bitcoin network. Since all new projects are inspired by Bitcoin, the concept of this series will inevitably overlap, sometimes almost exactly the same.

Since creating a new gravity well is possible and relatively easy (copy Bitcoin code, change some parameters, you can start a new network with a few friends), in the past few years, other types of encryption The currency has exploded.

Although most of these altcoins are downright scams, some currencies try to find a niche market that appeals to people who share their new ideas or modified ideas. (Note: niche market refers to some market segments that are ignored by companies with absolute market advantages, and supply services have not been perfected in this market.)

Gravitational wells with different ideas attract different people

The traction we see in Bitcoin and other communities is largely due to being sucked into these gravitational wells and into a “idea-value feedback loop” mentioned above. The direct link between holding beliefs (ideas) and holding assets (values) is a multiplier relationship that may lead us to build stronger relationships with them.

In any case, it is very difficult to give up your original ideas/ideas, and it is even harder if your net worth is closely related to these ideas.

Track and collision

The formation of any gravitational well is not smooth sailing. Just as the formation of stars and planets is sometimes violent—the sun devours planets, the planets collide with each other, and the satellites are smashed into pieces—the formation of bitcoin gravity has also experienced some violent events (such as the production of BCH and BSV).

This article will not outline these events, but we need to admit that there are currently some projects that run around Bitcoin orbit and have collided in the past.

An artist's impression of Bitcoin and its satellites. Source | KQED Science

Whether all other projects will be swallowed up by Bitcoin or die on their own, or whether some of them can find a stable track, is still unknown. However, what can be observed today is that most networks compete with each other.

Since it has happened many times in the past few years, we can also observe that projects that fail to deliver on their value proposition are rapidly losing most of their followers and values ​​- losing followers because their fantasies are shattered Losing value is because of the power of the market.

Value, and speculation about future value, is an important part of the “idea-value feedback loop”. If the concept is not realized, the real (and speculative) value will be lost, which will actually stifle these ideas and the networks that carry them.

However, as long as people hold different ideas, as long as a project on the Bitcoin track reflects one of the concepts, people will come. Whether these ideas are valuable will depend on time and free market, and ultimately on reality. Bad ideas don't work at all, bad ideas don't last long, and solutions that don't have much worse than the status quo won't thrive in the free market.

However, the best ideas may be discovered and absorbed by the largest network (if possible). If Bitcoin is available, it will absorb it.

Absorb other ideas

As mentioned above, the core concept of Bitcoin has been fixed from the beginning. However, this does not mean that Bitcoin cannot be improved. Bitcoin can and should be improved, but must be improved in a way that does not destroy the nature of Bitcoin.

This kind of improvement has been happening, which is why we can "pay for script hash (P2SH, Pay to script hash)", have segregated witnesses, and can be fast and low on Lightning Network. Micropayments are made at a cost.

The technique of improving bitcoin – and the important difference between soft and hard forks – is worth exploring, but is beyond the scope of this article. Based on these technologies, Bitcoin is undoubtedly improving, so its feature set is changing and expanding.

In terms of bitcoin gravity, this means that bitcoin is becoming more popular. The idea of ​​describing Bitcoin and its feature set is expanding, potentially attracting more people and consuming the competing projects and ideas in the process.

For example, the concept of low-cost micropayments has reappeared due to payment channels on lightning networks. Although still in its early stages, if the lightning network achieves large-scale success, other projects based on this concept will lose its advantages.

Privacy protection is another concept of Bitcoin and the core of several competitive projects. If Bitcoin's privacy protection is enhanced in the future (Schnorr signature, lightning network, whirlpool, wallet supporting CoinJoins), these items may also be swallowed up by Bitcoin.

The author does not mean that all other projects are bound to die out. However, the prosperity of the blockchain network benefits from the network effect: the winner will get the most, if not all, of it.

Value of belief

Without exception, tribalism becomes a norm whenever people are arguing about ideas/ideas. Whether it's politics, sports, or iPhone vs Android, people find a sense of belonging in the camp closest to their ideas and ideals.

Although the validity of ideas/ideas is sometimes difficult to measure, either because their results are very indirect (such as in the political arena), or they are too subjective and have no substantial impact on the overall picture, but networks like Bitcoin have A direct measure: value.

Although value may be distorted by price manipulation and speculation, it is a reliable (almost) direct indicator of belief and effectiveness. If more people are convinced by the idea of ​​the Bitcoin network, then more people will hold Bitcoin assets. The more these concepts are consistent with reality, the network can generate more real value, convince more people, and deepen the beliefs of those who have been convinced.

Bitcoin has the greatest appeal for a reason: it can be used from the very beginning, solving real problems for people and producing real value. It works because its philosophy is closest to reality. Bitcoin is valuable because people believe in its value proposition and for good reason: the Bitcoin network is by far the largest, safest, most powerful, and unlicensed digital asset transfer network. And it is still growing.

Whether you have been convinced by the idea of ​​Bitcoin, or vice versa, Bitcoin will not care. Its gravity will continue to increase, absorbing thoughts, people, code, and nodes in the process.

Conclusion

We have seen that Bitcoin carries a specific idea in its consensus rules and overall architecture. Changing the core concept of Bitcoin is almost impossible, which is why its core design is “fixed” from day one.

The “idea-value feedback loop” is the charm of Bitcoin. People close to this cycle have a certain likelihood of being attracted, which allows them to align their ideas with Bitcoin or run counter to them.

Since changing the core concept of Bitcoin is not feasible, projects that carry new ideas come one after another, and new gravitational wells are created in the process.

The foundation of each gravitation well is a different “idea-value feedback loop”. Tribalism and the psychology of avoiding disadvantages help to explain some of the phenomena between competing projects and communities. Anyone who is attracted to a gravitational well will have an impact on its worldview.

Both the world and Bitcoin are dynamic developments, which makes it impossible for any set of ideas/concepts we currently hold to stand forever. Bitcoin can and does change, even though its nature is virtually immutable. No matter what our personal beliefs are, we can't be too attached to any set of concepts/ideas.

The dominant position of Bitcoin is not accidental. Its series of ideas succeeded in convincing the largest group of people, which in turn produced the greatest value. But sincerely exploring other ideas/ideas may also be a useful thing. Time and free markets will determine which ideas are in line with reality. Bad ideas will disappear and good ideas will be absorbed.

In today's world where people have ideas/ideas and valuable assets, a “feedback loop” that links and strengthens the two is a powerful attraction. Whether you are just beginning to feel the mild appeal of Bitcoin, or have become a Hodler on a close track, the gravity of Bitcoin will continue to increase. The author is convinced of this idea and hopes to plant a seed of faith in you.

Extended reading

 

• Unpacking Bitcoin's Social Contract — Hasu:

Https://medium.com/s/story/bitcoins-social-contract-1f8b05ee24a9

We can't all be friends: crypto and the psychology of mass movements –Tony Sheng:

Https://www.tonysheng.com/mass-movement

Visions of Bitcoin — How major Bitcoin narratives changed over time — Hasu and Nic Carter:

Https://uncommoncore.co/visions-of-bitcoin-how-major-bitcoin-narratives-changed-over-time/

The Many Faces of Bitcoin — Murad Mahmudov and Adam Taché:

Https://hackernoon.com/the-many-faces-of-bitcoin-1c298570d191

Bitcoin: Past and Future — Murad Mahmudov and Adam Taché:

Https://hackernoon.com/bitcoin-past-and-future-f2feba1f419d

Crypto-incrementalism vs Crypto-anarchy — Tony Sheng:

Https://www.tonysheng.com/incremental-vs-anarchy

Bitcoin Culture Wars — Brandon Quittem:

https://medium.com/@BrandonQuittem/bitcoin-culture-wars-what-doesnt-kill-you-only-makes-you-stronger-b0db7e5515e1

Schrödinger's Securities — Nathaniel Whittemore:

https://hackernoon.com/schr%C3%B6dingers-securities-regulation-the-quantum-state-of-crypto-ffb4e5b7446

Market Narratives Are Marketing — Nathaniel Whittemore:

Https://tokeneconomy.co/market-narratives-are-marketing-introducing-the-crypto-narrative-index-deeeb49bc909

Quantum Narratives — Dan Held:

Https://tokeneconomy.co/quantum-narratives-859cde44401b

Acknowledgement

• Thanks to Hasu, his great feedback helped shape most of this article. His article on Unpacking Bitcoin's Social Contract is the source of inspiration for the author.
• Thanks to Nathaniel Whittemore for his feedback on the early draft of this article.
• Thanks to Ben Prentice for proofreading the final draft.

Source | Unitimes

Author | Gigi

Compile | Jhonny

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