Lately, a concerning divide has sprung up in the Bitcoin community. This division has resulted in two fiercely opposed factions. One faction, referred to as the “Bitcoin transaction maximalists,” insists that Bitcoin Layer 1 should be exclusively for processing transactions. Conversely, the “Ordinal enthusiasts” wish to experiment with Layer 1, using it to record arbitrary data.
I must clarify, I am neutral in this dispute. Both groups present strong arguments for their case. This article’s objective isn’t to favor one side over the other, but rather to shed light on the potentially harmful consequences if this internal strife persists.
Showing Empathy for Bitcoin Transaction Maximalists
The split within the Bitcoin community emerged when the Ordinals protocol was introduced in January 2023. This protocol brought NFTs to the Bitcoin realm—a space typically dominated by the Ethereum community. As the Ordinals revolutionized the dynamics, creators who previously minted NFTs on Ethereum flocked to Bitcoin, bringing along new developers and inevitably, higher transaction costs.
The Bitcoin blockchain isn’t optimized for speed, hence the advent of the Lightning Network and other Layer 2 solutions. The Bitcoin network’s primary function is to facilitate highly secure and consistent value transfers, boasting an uptime of 99.98%, a remarkable feat. This reliability is exactly what’s needed in a dependable base money system.
However, an increase in Bitcoin users implies an upsurge in transaction fees due to limited block space, resulting in some transactions being outbid or even priced out completely. This may not be a significant issue for those in the Western world who can afford to wait for fees to drop. However, it poses a significant challenge for users in the global south who rely on Bitcoin for day-to-day transactions. This is why I empathize with the notion that Bitcoin’s primary use should be transactional.
Empathy for Bitcoin Ordinal Enthusiasts
That being said, the Ordinals protocol does follow Bitcoin’s guidelines. Since its inception, there’s been a noticeable increase in activity on the Bitcoin network. While this has led to a significant rise in fees (a staggering 560% increase by May 2023), it has also illustrated how these fees could eventually replace the block subsidy. However, it seems that the Bitcoin transaction maximalists were caught off guard by this early transition in the Bitcoin adoption cycle, sparking their resentment towards Ordinal enthusiasts.
Some of these maximalists perceive Ordinals enthusiasts as merely disruptive altcoiners, cluttering the Bitcoin network with their peculiar activities. However, Bitcoin is a permissionless network—users can utilize it as they wish, as long as they adhere to the established rules.
The ongoing tension within the Bitcoin community, resulting in clearly defined camps, is unfortunate. Our shared mission should be fostering the widespread adoption of a Bitcoin standard.
Bitcoin’s Ambassadors
This disagreement was largely contained within Bitcoin Twitter, but tensions flared openly at the Bitcoin 2023 conference in Miami.
The “Great Ordinals Debate” at the conference was a glaring manifestation of this discord. Representatives from each faction clashed, accusing each other of hampering Bitcoin and its adoption. The debate seemed immature, and the squabble over BRC-20 tokens distracted from more important matters.
To the wider public, the optics were less than ideal—a group of men arguing over technicalities that most wouldn’t comprehend. As we aim to onboard billions globally, such infighting over esoteric matters doesn’t promote a welcoming image.
This contention seems to reflect a broader existential crisis within the Bitcoin community. What does it mean to be a Bitcoiner? How should the network be utilized? Is it right for Bitcoiners to dictate how others use the network?
These questions will likely persist as Bitcoin evolves and new use cases emerge.
Internal squabbling, whether on social media or at conferences, paints the Bitcoin community in a negative light and suggests an industry not quite ready for prime time. For Bitcoin to become a global reserve currency, we need to establish order within our ranks.
As ambassadors for Bitcoin, we must present a unified, professional front to the world. Bitcoin’s mission is to provide a superior alternative to the world’s fiat currency system, and that won’t be taken seriously until we demonstrate maturity and mass adoption.
To bring about global change, the Bitcoin community needs to remain focused, coherent, and appealing to a broad audience. Let’s remember what brought us to Bitcoin and remain united in achieving our shared goals.