Reconsidering the first cryptocurrency’s slow-and-steady approach to development, as Ethereum’s “Merge” nears – writes Chris Castiglione on CoinDesk.
Bitcoin is slow to change. Transaction speeds are too slow for a global payment system. The community is reluctant to embrace novelty. And the rate of new innovation, in comparison to nearly every other blockchain, is tortoise-like. Fortunately for Bitcoin, I believe its slow and steady pace will ultimately be its superpower.
This year Ethereum will undergo a radical upgrade known as the Merge. This event, scheduled for mid-September, will change the underlying “consensus mechanism” that allows blockchains to function from something like Bitcoin’s proof-of-work system to a more experimental model called proof-of-stake. It’s a development that has been underway for years.
Vitalik Buterin, co-founder of Ethereum, announced at a Paris-based Ethereum conference that after the Merge, Ethereum will still only be 55% complete. There’s a list of upgrades to Ethereum slated for the next two decades. The Ethereum community, Buterin cautioned, should learn to expect “short term pain, and long term gains.”
This mentality of development opens Ethereum up to new possible futures, but also risk. Herein lies the opportunity for Bitcoin – an opportunity to embrace its slow rate of change so that it can become the world’s most valuable “forever database.”
A forever database is a gift to humanity
I’ve heard blockchains described a million different ways: “an immutable ledger,” “a shared system for recording data,” “a growing list of records secured by cryptography.” All of this is fine. But for the average person, these explanations are confusing. The simplest definition of a blockchain is a forever database.
Maybe you’re a total beginner and you can’t picture a database. No problem. A database is basically a fancy Excel spreadsheet. And a forever database is one in which when you write data that is stored, well, forever.
Due to a series of design decisions, blockchains are immutable. Theoretically, the data stored becomes a bullet-proof record of truth for thousands of generations to come.
Since Bitcoin went live on Jan. 3, 2009, the network has never gone down, been hacked or stopped storing new data. Bitcoin (BTC) is also a currency that can’t be inflated, a selling point that has become the network’s chief use case. The bookkeeping is never wrong.
Imagine being able to trust that 1,000 years from now your data and money will still be accessible. Not only that, but people living many generations into the future could verifiably trust that this ledger is true. That’s powerful.
Forever databases enable novel use cases beyond money-like instruments, which are primarily being explored on networks beyond Bitcoin. Mike Bodge’s crypto-art project, 0xinfinity, allows you to publish love letters the site claims will last “forever or as long as the Ethereum network is running.” Arweave is a file storage service that claims “to store documents and applications forever.” And Starling Labs is a project that, among other things, has uploaded 56,000 Holocaust survivor testimonials to preserve evidence of human rights abuses and protect against future disinformation.
A forever database ensures the integrity of our collective memories in a way that previous databases could not.
And yet, consistency is the key ingredient. As long as Ethereum, Solana, and other blockchains continue to upgrade their codebase, they can’t compete on consistency.
In early 2022, the Solana blockchain, known for its “move fast and break things” mentality, suffered two outages, each of which took down the network for several hours. The key superpower that makes a blockchain a forever database is being resilient to outages. A forever database should never go down; if it does, let’s just call it “database.”
For Bitcoin to thrive, users need to do more than just hold their money. Bitcoin needs to become productive. There is an opportunity for biticoiners to harness the power of their forever database through the use of additional layers (e.g., Lightning or Stacks) so that they can build new applications.
The race to embrace layers
Stacks is an example of a layer that adds programmability to Bitcoin. With Stack’s Clarity smart contracts, you can create applications (social networks, photo-sharing apps, chat apps) where the underlying transactions are secured by Bitcoin.
On Ethereum, similarly, Polygon is a popular layer developers use to scale the Ethereum network. The difference is that if Ethereum were to fail, Polygon and all of Ethereum’s additional layers would follow, falling like a house of cards.
We need a new layer, one that can access Bitcoin’s forever database. It, and only it, can be a complete system on which we build the future.
In 2010, Satoshi Nakamoto, Bitcoin’s founder, first encouraged the idea of building layers on Bitcoin. “I think it would be possible for [a blockchain] to be a completely separate network and separate blockchain, yet share CPU power with Bitcoin.” What Nakamoto saw back then was the opportunity for Bitcoin to be more than just money.
Slow and steady wins the race
If we wish to create a forever database, we must celebrate Bitcoin’s approach to long-term stability. This is what Vitalik Buterin was doing when he said Ethereum should become more Bitcoin-like by “emphasizing long-term stability.”
Both Bitcoin and Ethereum will do great things for humanity. I’m excited to see them each take their own approach to building the future. As Ethereum evolves swiftly I believe it will continue to innovate.
However, until Ethereum settles down, it will lose its standing in the race to become a forever database. It’s taking on too much risk, and the world may never know exactly what Ethereum will look like until decades down the line.
This is Bitcoin’s moment. Bitcoin needs to embrace building layers. Bitcoin should not remain as money, it must learn how to be productive. Ultimately, I believe slow and steady is the secret to winning the race — because while fast may get all our attention, it’s slow that has all the power.
Chris Castiglione is co-founder of Console.xyz, a secure chat platform for Web3. He’s also a general manager at Trust Machines, where he’s working on MultiSafe.xyz, and an adjunct professor at Columbia University Business School.