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Why is Bitcoin growing so slowly? Which is better, the tortoise or the rabbit?

Why is Bitcoin Development So Conservative?

By Vlad Costea

Ah Jian, ethfan

In a world where weekly software updates are the norm and patches can even be released at any time, bitcoin's software development seems to be Mired in a certain conservatism. The base layer is being solidified, the way the software works is becoming more rigid, and developers are still developing optional optimizations that don't break the consensus between nodes.

For the uninitiated, there seems to be nothing new in the world of bitcoin. The fact that alt-coins are experimenting with all sorts of new ideas and deploying eye-catching features underscores this distorted impression. Anyway, Bitcoin is a set of software, if the industry's top developers are developing bitcoin, how could they be so slow, why don't they do VR games on the blockchain, they can also tokenize the video clips stored in the cloud, why didn't DeFi's liquidity mining first appear on bitcoin?

Well, first of all, bitcoin is a hard currency, and users have embraced the promise of e-gold. Second, the bitcoin network is sufficiently decentralized to phase out undesirable and unnecessary proposals. Each node operator is an independent voter, choosing their own software and optimizations, and agreeing to the underlying rules of the network.

Refusing to run the developer's code is part of the game. Decentralization is best achieved by rejecting code and not letting any code wizard (developer) become the tyrant of the network. That way, developers won't build on controversial software. And when a bug needs to be fixed, it can be expected to undergo rigorous testing and peer review.

Bitcoin's soft fork and game Theory

A soft fork is essentially extra code that is added to a Bitcoin node to run to achieve other goals. Soft forks are uncontroversial because, whether they are added or not, they do not break the network's consensus and cause it to split (as hard forks can if they are poorly organized). To explain bitcoin's conservatism, let's take a look at two of the most popular upgrade proposals: Taproot and Segwit.

Taproot was first proposed by developer Gregory Maxwell in January 2018 to improve the multi-signature functionality and privacy of the base layer. About three years later, the code is nearly complete and only 520 lines long. What does that mean? It means that on average every line of code has been audited for two days.

Even after the proposal has made it through peer review and into the roll-out phase, it still takes some time to convince community members to run the code on their own nodes. By September 2020, there was an ongoing consultation process to convince users, mining pools, trading platforms and wallet developers to support the proposal. However, as usual, full nodes will only add this extra code to their nodes if their operators find it useful and are confident that the code has been adequately tested.

As a result, SegWit, which received overwhelming support from developers, mining pools and trading platforms in 2017, has only been accepted by 50% so far. In other words, three years after some nodes started activating the soft fork, half of the network is still not running the upgrade to fix the malleability vulnerability.

Without a "benevolent dictator" to enforce a road map, Bitcoin relies on doubt and constant verification. Even if some users decide to run extra code on their own nodes, others can choose not to do so and still be in sync with the rest of the network.

Speed of development and the roll-out of new features were clearly not a priority for Bitcoiner. Most users will point to base solidification and the "Lindy effect" (the longer something lasts, the more likely it is to survive and maintain its meaning) as reasons for their conservatism. While additional features are good, you shouldn't aggressively push for changes or introduce unnecessary complexity to reap those benefits -- as the best experts will tell you, complexity is the enemy of good security and auditability.

Bitcoin development vs. alternative coin development

The slow and steady development of Bitcoin is quite different from the "fast progress, old and new" philosophy of alternative coins. Some of these networks are far more interested in providing features that capture the market's attention than making sure they work as efficiently as possible. This is mainly due to the centralization of their projects.

For Ethereum, it's much easier for developers to push a roadmap and hack away at the base layers than it is with Bitcoin. This is not just because they have a history of breaking blockchain immutability through "rollback", but also because some founders are keen on "governance" (using human intervention in matters of protocol, replacing "code and law" with politics).

As the network's co-founder and benevolent dictator, Vitalik Buterin can decide to accelerate the integration of a feature or prioritize a development direction. Similarly, the Ethereum Foundation can decide to fund certain projects or stop funding them. As for full nodes, Ethereum is much less decentralized, and the number of fully archive nodes is problematic (even Vitalik Buterin doesn't run such nodes, by the way). Even something as big as moving to a different base has been met with less opposition than applause.

The situation is even worse in other projects that dare not claim to be "decentralised". Thanks to their modesty, they are free to experiment with new features without worrying about the consequences. However, being able to activate SegWit before Bitcoin or add Schnorr signatures and Tapoot before Bitcoin is accepted does not make them more creative. Similarly, copying Ethereum's design to cater to the DeFi craze is shortsighted.

In a category, only the top networks can have the most consistently high quality development, while other projects tend to just copy and tweak metrics. This is good for code testing, but bad for venture capital, which is likely to fail.

In this climate, it is no wonder that newcomers will agree that Bitcoin is prehistoric. According to this view, bitcoin can lead the market simply because of its brand and first-mover advantage.

As a result, these boosters will tell you that their "faster" and theoretically "more decentralized" networks will eventually beat the king of money. Otherwise, why did so much development work go into the DeFi app when bitcoin took years to join a Taproot, why SegWit and lightning networks had such low acceptance, and why didn't there be a leader to unite everyone along the same path and form an official narrative for bitcoin's purpose?

Is Bitcoin afraid of change

All of this has to do with decentralization. Though in a world full of benevolent dictators and their walled gardens, this may seem counterintuitive. But, eventually, Bitcoin's Layer 2 and side chains will integrate everything you see on alt-coins today -- only they'll be built on a stronger base Layer that uses sound money. Accordingly, the base layer solidifies to the point where there are very few updates.

Bitcoin, while conservative, remains the most popular and decentralized cryptocurrency. Its transactions are the most secure, guaranteeing the best finality, and its network's incentives have lasted the longest. If the speed at which new features are being rolled out bothers some users, there are plenty of other options -- from Layer 2 to side links to privacy alt-coins -- that users can help themselves to.

Competition is healthy and necessary, whether for increased use, enhanced functionality, or enhanced protocol; Competition ultimately leads to a more secure decentralized system. Competition also helps test whether the same piece of code serves the same purpose in different implementations. If the bitcoin base layer does not provide absolutely necessary and certain functions in a politically volatile climate, alternatives exist both on and outside of Bitcoin. For now, what matters is decentralization and agreed upgrades.

Technologies designed to improve privacy and scalability, such as Schnorr signatures and Taproot, have not lost support and will also make Bitcoin more robust and ready for wider use. Meanwhile, research and experimentation continues on bitcoin and newer protocol upgrades, such as Prism's ability to implement directed acyclic graphs (DAG) to improve scalability.

Bitcoin is the most secure cryptographic currency and the most efficient store of value we have today. Any criticism should start by thinking about the game model when incorporating new code. After all, we grew up hearing stories about the race between the tortoise and the hare: it was the slow but determined tortoise, not the rabbit, who had the last laugh.