I recently had the pleasure of visiting the beautiful mountain town of Lugano, Switzerland, whose appeal is that it’s essentially Italy but run by the Swiss. This is according to Tether CEO, Paolo Ardoino, one of Tether’s main backers Plan Ba Bitcoin conference where I hosted a discussion on the growing trend of Nation states embrace The original cryptocurrency.
The event had an upbeat vibe – which was no surprise since everyone was worshiping Bitcoin – but it was also clear that there was trouble in paradise. It turns out there’s a growing divide over Bitcoin’s database, and whether it should be modified to allow the blockchain to include more non-financial data.
The idea of including data unrelated to Bitcoin transactions is not new, in fact it is a novel idea The very first block The blockchain includes a reference to a newspaper headline about bank bailouts. Now, though, Bitcoin’s largest and most influential group of programmers, known as the Core, are planning to modify their software in order to significantly lift restrictions on the amount of non-payment-related information that can be included in a block.
For the core audience, this is a simple and practical way to promote new uses for Bitcoin and, in the process, impose additional fees on miners at a time when the blockchain’s lottery payout stands at 3,125 BTC and is scheduled to halve again in 2028. There is a fast-growing rival faction, however, that wants nothing to do with the scheme and is promoting a Bitcoin client program of its own. It’s called Knots.
The faction’s program is led by an influential Bitcoin developer, a devout Catholic who is said to have named it “Knot” after the “knot whip” that Jesus used to expel money changers from the temple. According to a Knots lawyer I spoke with, the software is needed to protect the blockchain from what he described as spammers and “scam-adjacent” projects promoting things like Bitcoin NFTs.
If you’ve encountered Bitcoiners in person or online, you know that they’re not known for their ingenuity. This is true of prominent figures from the early days of Bitcoin who were denouncing each other on stage in Lugano and on Ex. These include prominent partisans Peter Todd and Jameson Lobb of the Core faction, and Nick Szabo and Luke Dashger of the rival Knots sect.
This latest breakdown (you can read the helpful breakdown here) takes us back to the Bitcoin block size wars that raged from 2015 to 2017, and ultimately saw the “small blockers” – who preferred to keep Bitcoin blocks at 1MB – triumph over competitors who claimed that increasing blocks to 2MB or more would be more commercially viable. That battle produced bad blood that continues to this day.
In the current battle, Knots is still the smaller faction, but has already become the preferred client of more than 20% of Bitcoin node operators. Its growing popularity stems not only from Knots’ stance on blockchain expansion, but also from the perception that the core audience has become arrogant and out of touch with Bitcoin’s core values. Meanwhile, the core people dismiss the Contract Faction as lying troublemakers.
I lack the authority to comment on much of this, other than to note that this latest battle for Bitcoin’s soul reinforces what I’ve said for years: Bitcoin is a great technology, but it’s also a religion. In any religion, there will be divisions between ancient believers and modern followers. Fortunately for fans in Lugano, there was a moment of unity that came with the unveiling of a restored Satoshi Nakamoto statue on the city’s beautiful lakefront. The Bitcoin factions may be at war, but there is no doubt that they still worship a common god.
Jeff John Roberts
jeff.roberts@fortune.com
@jeffjohnroberts
Decentralized news
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Main character of the week
Samsul Saeed – Bloomberg/Getty Images
CZ was the easy choice for the main character the following week Obtain a presidential pardon. Critics, who pointed to a $2 billion deal involving the Trump family’s stablecoin and Binance, slammed the pardon as broadly corrupt, while many on Crypto Twitter claimed it was fair because Czechoslovakia – who pleaded guilty – was the target of a political prosecution.
Mimi, oh wait
@Globalstats11
Bitcoin lovers seeking to make the pilgrimage have a growing number of options. In addition to the restored Satoshi statue unveiled in Lugano, there is one in Budapest as well. Could the official shrine — or perhaps a Bitcoin theme park — be far behind?
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