Bitcoin in the Headlines is a weekly analysis of media and its impact.
Long-time bitcoin enthusiast and developer Mike Hearn officially “left” the open-source project this week, making clear a previously quiet departure by slamming the door in the form of an impassioned if highly contentious open letter to the community.
The former Google employee, whose contributions to the open-source transaction network include the widely used library BitcoinJ, and crowdfunding application Lighthouse, went so far as to proclaim the bitcoin project had “failed”, a narrative that was seized by global press.
At press time, Hearn’s exit had been profiled by news outlets as diverse and far-reaching as The New York Times, The Guardian, Fusion, PC World and Fortune, all of which emphasized his declaration that the project should be considered dead despite its position as the longest-running blockchain and digital currency with the highest market capitalization.
Adding fuel to the fire were damning comments that sought to paint Blockstream co-founder and bitcoin developer Gregory Maxwell as a villain in the ongoing debate over whether the open-source project should be scaled to accommodate more users or prioritize its emphasis on decentralization.
"Why has Bitcoin failed? It has failed because the community has failed. What was meant to be a new, decentralised form of money that lacked ‘systemically important institutions’ and ‘too big to fail’ has become something even worse: a system completely controlled by just a handful of people."
Perhaps most damning were statements that aimed to paint the network as "on the brink of technical collapse" and no better than "the existing financial system".
But, while publicizing an important technical debate, the media’s emphasis on using Hearn’s post as a primary reference did much to color the conversation in terms of his highly unique categorization of the drama.
Of the aforementioned reports, only the Times included comments from members of the development community outside of Hearn, a move that further ensured that his viewpoint on a complex issue was given the majority of the spotlight.
Reactions to the flood of media attention were particularly barbed, though much of the ire focused on Hearn and the way in which he chose to highlight his departure from the industry.
Some of Hearn’s worst critics at the moment point to the fact that the event felt like a veiled publicity stunt for his latest project R3CEV, the consortium that has so far signed up more than 40 major banks that describes itself as “part investor, part market facilitator and part product developer in the cryptocurrency and blockchain marketplace”.
Lending evidence to the idea is the fact that the release of Hearn’s post coincided with the publication of a profile in The New York Times that appeared largely sympathetic to the developer’s version of the events and debates ongoing in the community.
Across major media outlets, outside of the Times, there was little mention that Hearn is now employed by R3, and that the market strategy of his new employer is largely a response to the idea that the bitcoin network is ill-suited to the needs of major banks.
Perhaps the most pointed responses came from bitcoin developers, with consultant Peter Todd going so far as to question Hearn’s technical understanding of his criticisms of the bitcoin network, calling him a "blatant liar".
The RBF section of Mike Hearn's "Leaving Bitcoin" post reminds me I'm not going to miss working with blatant liars. https://t.co/Jl4Rb5be6O
— Peter Todd (@petertoddbtc) January 14, 2016
The criticism was echoed by BitTorrent creator Bram Cohen. The developer, who has recently begun speaking at bitcoin industry events but is not a member of any project, questioned Hearn’s technical prowess, while calling his post “whiny”.
— Bram Cohen (@bramcohen) January 14, 2016
Mike Komaransky, of the normally quiet bitcoin firm Cumberland Mining, was compelled to issue a response, suggesting consensus on key matters highlighted by Hearn would be easier without his presence in the community.
Bitcoin Hearn Paradox- With him, consensus is hard to reach, btc suffers. w/o him, consensus is easy to reach, bitcoin prospers.he can't win
— Mike Komaransky (@mkomaransky) January 14, 2016
Speculation that the event was a media stunt has persisted into Friday, with popular posts on the subreddit r/Bitcoin attesting evidence to the minority view.
"The timing of the New York Times article, this policy panel, Mike Hearn's Medium blog post, fits all too well," one user wrote.
Of all the articles, perhaps the one given the most scrutiny was penned by Times reporter and “Digital Gold” author Nathaniel Popper.
Though a target for criticism by community members like Cody Wilson, Popper’s piece is perhaps one of the more balanced that emerged.
Despite flourishes, including a softly lit image, that are sympathetic to Hearn, the piece includes the most exposition on the block size debate, elaborating on Maxwell’s own difficulties as a leading figure in the bitcoin community and detailing former Bitcoin Core lead maintainer Gavin Andresen’s thoughts on the debate.
The report did give odd impressions using language that suggests, despite a global development community, the open-source project is only backed by “a handful of developers”, and interestingly did not include any commentary from members of Bitcoin Core or Blockstream, groups that have argued for approaches that stand in contrast to Hearn’s views on the project's future.
Popper largely stayed away from Hearn’s technical analysis of the bitcoin protocol and mining network, as well as his selected quotes that aimed to portray still-anonymous bitcoin creator Satoshi Nakamoto as in favor of scaling the network for competition with more traditional payment networks like Visa.
In statements, bitcoin developer Eric Lombrozo said that evidence could be equally found that Nakamoto believed having multiple implementations of the bitcoin software would present challenges for developers given the network’s reliance on Consensus.
Still, he suggested the article perhaps did not do enough to portray the project as one that was responding to concerns, albeit slower than observers may want.
“Bitcoin Core has been working on this issue a lot…and we now have a way of deploying bigger blocks in a way that is backwards compatible and is practical and safe and can be rolled out soon,” Lombrozo told CoinDesk, adding:
"This will hopefully reduce hostilities in the future and allow for more implementations to enter the space peacefully."
To many observers, coverage of the story also had a measurable impact on the price of bitcoin, which, as profiled by Newsweek, sank by as much as $50 before recovering in the wake of the news.
At press time, many smaller news outlets had seized on the story, with as many as 30 news outlets covering the blog post or its impact on the price.
As a sign of the story’s impact Financial Times reporter Izabella Kaminska issued her take, painting Hearn’s departure as evidence that a "rare voice of reason" had left the community.
Kaminska used the event to discuss her views on how bitcoin remains a system that will be unable to solve problems for the financial industry, or offer much outside of evidence of how social theory and economics can yield academically interesting results.
On Twitter, more tenured bitcoin community members offered a sympathetic take on Hearn’s post and its resulting publicity, seeking to highlight the project’s continued perseverance in the face of declarations that it will not succeed.
Best way to respond to all the drama in bitcoin is to focus. Buckle down, work, don't get distracted. Engineering solves problems. Code On!
— AndreasMAntonopoulos (@aantonop) January 15, 2016
Still others thanked him for his work on the project and were amicable about what will surely be recorded as the community’s most high-profile and contentious departure to date.