Why keeping up with Bitcoin is a full-time job https://ift.tt/3mshzd6

BitcoinTechnology

Dec 24, 2021 at 17:38 UTC

Several years ago when I discovered Bitcoin and the growing world of cryptocurrencies, my instinct was to dive in with full force. I wanted to learn everything about how Bitcoin works and why we need it, about the cryptography behind privacy coins like Monero, Grin and zCash, about smart contract platforms and DeFi… 

I burned out. It was just too much information and it was impossible to keep up with everything. And I was increasingly suspicious that most of it was just noise that would ultimately lead nowhere.

A healthy thing to do after a burnout is to take a step back and refocus. What was the initial motivation that led me to this space? The idea of a global monetary system that is fair, neutral and with no-one in charge. So I went back to the roots and dedicated my attention solely to Bitcoin. To my surprise, I soon found that keeping up with Bitcoin alone is a full-time job in itself. 

That may be surprising to those who have heard that Bitcoin has little to no development and that all the action happens on other chains. That’s partly true for the base protocol, where things move slow (for a good reason), but in its entirety, Bitcoin is far outpacing other technologies. This is because Bitcoin is a multifaceted phenomenon. Besides protocol development, the areas of focus are the Bitcoin ecosystem, its Lightning and application layers, the philosophy and economics of Bitcoin, and its prevalence in context of current events. 

Bitcoin protocol

“Move slowly and break nothing.” –Cory Klippsten

Development at the protocol level is intentionally conservative. Even non-contentious upgrades like Schnorr signatures and Taproot take years to be adopted. 

The slow-pace of development is mostly out of concern for breaking network consensus. Bitcoin is decentralized and every transaction is validated by thousands of individually operated nodes. There needs to be widespread agreement about what protocol rules are valid and, for any change in the protocol to be introduced, node operators need to be given sufficient time to acquaint themselves with the changes in order to decide whether to run the new code. All Bitcoin protocol updates are therefore implemented as so-called soft forks: backwards-compatible changes where updating is optional and non-updated nodes remain part of the network. 

While it takes a long time for any particular change to find its way into the Bitcoin protocol, there are a lot of ongoing proposals and relevant discussions to follow. To learn about how Bitcoin works under the hood and to keep up with various Bitcoin Improvement Proposals (BIP) check out these resources:

Bitcoin ecosystem

“I will make you obsolete.” –Nicolar Dorier

There would be no Bitcoin adoption without various ecosystem tools. Software and hardware wallets, full node solutions, blockchain and mempool analytics, payment gateways, and multisig and CoinJoin implementations are all part of the vibrant ecosystem that makes Bitcoin a useful financial instrument, not just a theoretical project.

Keeping tabs on how Bitcoin tools evolve is useful for improving privacy, security and sovereignty. Holding your bitcoin on a custodial exchange is antithetical to Bitcoin and exposes you to a potential world of hurt.

To improve your Bitcoin experience through security and privacy, get acquainted with these tools:

Wallets:

• Trezor – the original hardware wallet, based on the Free and Open Source Software (FOSS) philosophy
• Specter – desktop multisig wallet and DIY hardware wallet
• Muun – hybrid Bitcoin wallet for both on-chain and Lightning transactions
• Phoenix – easy to use Lightning wallet
• Zap – advanced Lighting wallet for users who run their own Lightning nodes
• Samourai – advanced on-chain wallet for Android users with enhanced privacy capabilities (CoinJoin, postmix tools, coin control)
• Wasabi – similar privacy capabilities to Samourai, for desktop users

Open source tools:

• BTCPay Server – self-hosted, open-source Bitcoin payment processor supporting both on-chain and Lightning payments. Good alternative to 3rd party services like BitPay (in reference to which BTCPay’s founder Nicolas Dorier uttered the famous “I will make you obsolete” line).
• Mempool.space – blockchain and mempool explorer. Very useful for estimating on-chain fees.
• Bisq – decentralized bitcoin exchange that operates in a peer-to-peer fashion, without any Know Your Customer (KYC) identification processes. Good choice for preserving privacy when buying or selling bitcoin.

Bitcoin full stack solutions are also becoming popular. These come in the form of plug-and-play Bitcoin full nodes, often with the option to also install a Lightning node, BTCPay Server, or blockchain and mempool explorers and other tools. Some examples are:

A good way to keep up with ecosystem developments is to follow the No Bullshit Bitcoin channel, either on Twitter or Telegram.

Lightning and application layers

“Yo.” –Jack Mallers

People sometimes ask what Bitcoin’s killer app is. The Lightning Network seems to fit the bill quite well – a payment network that facilitates global, instant, low-fee micropayments while keeping true to Bitcoin’s permissionless qualities. All the metrics related to Lightning Network’s growth have exploded this year and the previously “reckless” payment method is becoming more stable and usable by the day.

Explosive growth in Lightning Network capacity, currently at 3300 BTC / $170M. The bigger the capacity, the higher the chance that user transactions will find a route even if two transacting parties do not have a direct payment channel opened. Source: lookintobitcoin.com. 

Moreover, development of the Lightning Network isn’t constrained by concerns over breaking consensus, and that’s why progress has been quite rapid since Lightning became publicly usable in early 2018. 

An example of those fast-paced advancements is LNURL: a set of complementary protocols that make the user experience on the Lightning Network much smoother. One of these protocols is called LNURL-pay, which improves the basic Lightning payment experience, where the receiver has to issue an invoice before they can be paid by allowing more intuitive push payments, where the receiver uses a static invoice with which a payer can initiate a payment at any time. Other LNURL improvements continue to make the payment network more intuitive and usable even without technical knowledge of how things work under the hood.

The Lightning Network ecosystem is expanding rapidly and a new crop of Bitcoin projects and companies are built partly or entirely on top of Lightning Network. One of the most notable is Jack Mallers’ Strike, which revolutionizes remittance payments by offering instant and almost-free payments around the globe – Strike’s API powers Twitter’s bitcoin lightning tipping feature. 

There are even projects attempting to build a Layer 3 on top of Lightning, thus possibly realizing the vision of a decentralized and private internet, with applications such as peer-to-peer chat (Sphinx) or voice-over-lightning (Red). 

These are some of the most exciting projects to follow when it comes to Lightning and its development:

Philosophy and economics of Bitcoin

“Gradually, then suddenly.” –Parker Lewis

Bitcoin isn’t just about the protocol and ecosystem developments – those are Bitcoin’s “how”, but everyone first needs to understand the “why” of Bitcoin. Why does any of this even matter? Why should I adopt Bitcoin in the first place, and why should it survive in a fierce competition of fiat currencies and altcoins? This is where the Bitcoin-focused philosophy and economics step in. Studying the various societal contexts and consequences of Bitcoin is quite a deep rabbit hole of its own.

Here are just a few questions of the many to ponder:

• What is the impact of inflation and currency debasement?
• What is hyperbitcoinization, how does it occur and can it be stopped?
• Will money trend towards one universally accepted standard, or can multiple forms of money coexist?
• How will a sound money standard transform our economies?
• Will Bitcoin still work after its block subsidy tapers?
• Can Bitcoin satisfy the needs of a multi-planetary civilization?

If you’re curious about the possible answers to these questions and many more, check out these resources:

Current events, studies and analyses

“What is up freaks?” – Marty Bent

As Bitcoin gains prominence, events pertaining to it become more common. Whether it’s the umpteenth China ban, ransomware scare or ESG-motivated critique, you can always find qualified commentary on the given topic. On top of that, long-form professional studies worth reading are emerging more often.

These are several deep-dive studies from recent months:

And here are content creators for high quality commentary on current events:

Bitcoiners are minimalists

Bitcoin as a living organism isn’t easy to fully grasp. In the text above I have broken it down to some crucial aspects to examine in further depth through the linked resources. While I stand by them as a good starting point, Bitcoin is about community: to dive deeper into what Bitcoin means, one irreplaceable resource is Bitcoin Twitter. 

To understand not just Bitcoin, but bitcoiners as well, Twitter is where you can soak up the ethos of Bitcoin in all forms, through memes, threads, heated debates, and live discussions on Spaces. If you want to feel the ferocity of the bitcoiner movement – hate it or love it – Bitcoin Twitter is the place to be. 

Bitcoin is a multifaceted phenomenon that requires focus and dedication to be understood in its fullness. That is why some of us choose to ignore the broader “crypto” ecosystem and dive deeper into what we believe is the signal among the noise. What comes across as closed-mindedness to some is in fact a pragmatic choice to declutter our minds and focus on Bitcoin alone, embracing the clarity brought about by cognitive minimalism.