In a period of two days, the bitcoin price fell by close to 15%. This is after Mike Hearn, one of the most visible Bitcoin lead developers, announced on the 14th of January, 2015 that he had decided to throw in the towel and walked away for good.
As a matter of fact, thanks to his departure, for the first time in 2016, the Bitcoin price crossed the $400 mark on its way down.
Ironically, at the same time the Bitcoin price was falling, prices in stock, financial and other mainstream asset markets around the globe were falling as well. The effects of the Chinese economic downturn were being felt more even in those markets that are out of the world’s second largest economy.
This is a perfect situation that would otherwise make Bitcoin gain in value as investors in these other markets are looking for safer investment options of where they can put their money.
That did not happen in this case due to the fear that Mike Hearn’s so dubbed farewell essay to the bitcoin community stoked amongst old and would be new bitcoin investors. The short and the long of Hearn’s message was that Bitcoin was dead and putting your money there wasn’t the wisest thing to do.
And thus, the price responded accordingly.
The community is discussing Hearn’s exit
That said, declining bitcoin price was not the only response that Mike Hearn’s farewell message stoked.
Members of the community have been talking since the news broke. Bitcoin forums like the Bitcoin sub-Reddit and Bitcointalk.org are full of discussion threads regarding this piece of news.
As expected, some of the observations that community members are making are objective, others are not, and some are technical analysis of the points Mike raises and others are simply apt comic reliefs.
Among the first to react was Gavin Andresen, a fellow bitcoin core developer, who took to Twitter and stated that “Mike is too pessimistic.” It is important to note that Gavin shared the same vision for Bitcoin with Hearn.
Amidst the debate on block size scaling that seemed not to have an ending in sight, they developed a version of the Bitcoin core, which they referred to as Bitcoin XT, that they thought the community would embrace.
Wished the best in his future endeavors
That did not happen as many did not see the proposal as one that could increase the capacity of the network while at the same time safeguarding the ideals of decentralization, which indeed led to the invention of Bitcoin in the first place.
Many have said that unlike Gavin, Mike Hearn did not accept the turn down from the community well. Perhaps that’s even why he has jumped ship.
Another person who was quick to react to Mike Hearn’s exit was Andreas M. Antonopoulos, author of Mastering Bitcoin. “I disagree with Mike Hearn's analysis and concerns,” he tweeted, “I thank him for all his work and wish him all the best. Onwards”
I disagree with Mike Hearn's analysis and concerns (see LTB show next week). I thank him for all his work and wish him all the best. Onwards— AndreasMAntonopoulos (@aantonop) January 15, 2016
On his part Henry Brade, Bitcoin entrepreneur, chose to respond with a long post, which like Hearn’s, he published on Medium. In the post, he tries to answer to Hearn’s article point by point.
New employer and a new mission
He also raises questions about the possible motive behind Mike’s actions. “Hearn recently got a new job at R3, which is a blockchain project backed by over 30 major banks,” he opines, “Then he posts an article on Medium and the NYT that states his old ‘employer’ has a lot of problems. This context is important especially if we look at Hearn’s past problems with the Bitcoin community.”
Coincidentally, Charley Cooper, Mike Hearn’s new boss at R3 appeared to milk dry the news at the Brooking Roundtable on the future of distributed ledger technology, which took place on January 14, 2015.
He alerted those in attendance that the New York Times was about to run a story about Mike Hearn exiting from Bitcoin.
He gave this information in the while explaining to them how permissioned Blockchains, like the one R3 is working on, are better than the permissionless and decentralized Bitcoin network.
Many Bitcoin enthusiasts didn’t take that kindly. Even more importantly, the delight Charley Cooper seemed to take in the whole affair reinforced their belief among Bitcoin enthusiasts that Mike Hearn was a tool in the hands of those had the most to lose if Bitcoin succeeded.
Light moments in every situation
Indeed, the New York Times did take the front among the mainstream media in letting the world know that one of the Bitcoin’s lead architects thinks it is a failed experiment.
Bram Cohen, Creator of BitTorrent, has described Mike Hearn’s blog post that explains the grounds for his exit as ‘whiny ragequit’. “He attempted a hostile takeover of Bitcoin with Bitcoin-XT,” he has said in a blog post of his own, “and now that he’s predictably been made to feel like persona non grata in Bitcoin development he’s throwing a tantrum on his way out.”
Then there are the comic responses too. One meme attracting a lot of attention and shared on the Bitcoin Sub-Reddit reads, “Bitcoin experiment failed. Sorry Mike but Bitcoin is not yours to fail.”
And yet another reads, “Bitcoin is dead, but Bitcoin user is not affected.”
And some people have not forgotten to add this announcement of Bitcoin being a failed experiment to the tally of the number of times Bitcoins has been declared as dead. According to the Bitcoin Obituaries, a website that keeps track of these pronouncements, this is the 89th death of Bitcoin.
Back to the Bitcoin price, it looks like the storm has passed without unprecedented destruction. After whooshing to a low of about $350 over the weekend, the Bitcoin price is steadily making some gains. By Monday 17, January, it had climbed to over $385.
Meanwhile, discussions on Mike Hearn’s departure continue on various forums.
Image courtesy of Pixabay