I wasn't always a bitcoin maximalist. I used to own a few different cryptocurrencies and tokens from various projects. I used to believe in the “multi-coin world”, where there would be multiple types of competing cryptos at all times, and each person would hold a basket of coins they could use for different situations.
At that time, it made sense to me. How could you say that one coin was the best when there were tradeoffs for every coin out there? Plus, you might get lucky and discover the next bitcoin! I thought that buying coins was kind of like investing in early stage companies, and if you picked the right one, you could see 1000x profit on your investment!
That was in 2017. Then I started doing my homework in 2019, and within a few months I came to the conclusion that bitcoin is our only chance for non-state digital money. If bitcoin fails, everything fails.
I don't believe we shall ever have a good money again before we take the thing out of the hands of government, that is, we can't take them violently out of the hands of government, all we can do is by some sly roundabout way introduce something they can't stop.Friedrich Hayek
In my opinion, and in the opinion of most bitcoin maximalists (as I view the term), Bitcoin is the only digital asset that is distributed and decentralized enough to be censorship resistant money. Many “cryptocurrencies” are scams, and I think that is not a controversial opinion. The controversy is when (presumably) honest actors attempt to solve a problem by issuing a digital asset.
From a coin-agnostic perspective, bitcoin is not perfect, and other technology may be able to fill in gaps or solve problems that bitcoin cannot solve. Just like those early to bitcoin, people who are savvy to these new technologies can become rich by being an early investor. The go-to example is that Bitcoin can solve the “store of value” problem, while Ethereum can handle “smart contracts”.
My response is twofold. 1) These problems cannot be solved without solving the foundational problem of removing centralized control. Point to any “crypto project”, and there's a leader, a founder, a team of investors, a foundation – a central point of authority calling the shots. 2) If you can shut it off, it can't compete with bitcoin as money, and if it's not money, it doesn't need a token.
Technology can solve many problems, but it doesn't need a token with value attached to it in order to be useful. This is why I would label any other network with a monetary as a doomed to fail, even if the founders aren't scammers, per se. By all means, build the tool! But once you start pre-mining tokens for insiders and reserving a subsidy to fund your foundation, you've already lost the plot.
What Is A Bitcoin Maximalist?
Bitcoin VS Everything Else
The main attribute of a bitcoin maximalist is that they believe bitcoin is the only cryptocurrency worth holding and using. Not all maximalists agree on exactly how far bitcoin maximalism extends, but that's the basic concept.
There is no second bestMichael Saylor
There are different flavors of maximalism. For example, some people think altcoins are great because they allow for experimentation, and everyone should be allowed to do whatever they want. If people want to scam or be scammed, that's up to them. This is more of a laissez faire attitude. Some people need to touch the stove and get burned to figure things out for themselves.
Other people really hate altcoins and their scammy marketing. It's tough watching something you feel so passionately about be lumped into the same category and tarnished by the shitty behavior of many altcoin projects. Lies, scams, deceptions – these are the tools of altcoiners to pump their bags and buy more bitcoin for themselves. Fighting against altcoins is not just about being right, it's about protecting noobs from getting rekt.
Some bitcoin maximalists see the possibility of some use cases for alternative cryptocurrencies emerging outside of the bitcoin ecosystem even if they haven't revealed themselves just yet. Other people believe that all useful technology will be ported onto bitcoin, which is a major advantage of being “programmable money”.
Whatever specific flavor of maximalism you subscribe to, the general idea is that you believe bitcoin is the only coin worth buying and holding.
Proof of Work Maximalist
One of the main reasons that bitcoin is successful at retaining value over time and attracting individuals, companies, organizations, and nations to adopt is because of its proof of work algorithm. Proof of work is also why bitcoin will continue to be the dominant cryptocurrency used in the world, despite the FUD you hear in the news about its energy use. Bitcoin works because it consumes energy, not as an unintended consequence of energy use.
While other coins attempt to re-invent the wheel and establish themselves as “green” or “energy conserving”, bitcoin will succeed because it's a permissionless, open network with fair distribution of bitcoin through proof of work mining. This is non-negotiable.
No Centralized Leader
There is no leader in bitcoin, and that makes it more robust as a monetary network. With Ethereum, you have Vitalik and the Ethereum Foundation. With Cardano, you have Charles Hoskinson. With Tron, you have Justin Sun. With just about every other coin out there, you can point to a centralized organization, and most likely a single person, as the inventor, influencer, or cheerleader of the project.
From a threat model scenario, this is bad. If that person is put in jail or harmed in any way, the project is toast. From a development perspective, this is also bad because the community is dependent on that person having time, passion, and skills to keep developing. It means the project won't survive without its leader. Why stick around with a dying project when you can just hop to the next hot coin?
Satoshi disappeared a decade ago, and nobody has any clue where he went, or why. Without a leader, Bitcoin is free to become anything. If you want to change bitcoin, you'd better learn to code because it's the only way to get it done.
4 Reasons I Became A Bitcoin Maximalist
As I mentioned above, I was not a maximalist to start. I owned a couple of altcoins that I thought had some sort of utility, including Litecoin, Monero, Ripple, 0x, TheKey, Neo, Bitcoin Cash, Ethereum, and Ethereum Classic. After holding them for about two years, I sold everything for bitcoin and now I only hold bitcoin. Why? Here was my train of thought, and maybe it can help you make a similar decision.
1. The Expanding Bitcoin Ecosystem
As I was learning about bitcoin, I found a massive pool of educational resources and it continued to grow faster than I could consume it. Like the universe expanding at a pace so fast that you could never reach the event horizon, the bitcoin education ecosystem is growing so fast that I simply cannot consume it all. Maybe around late 2019 I might have had a shot at it, but these days (2022+), not a chance. Between bitcoin podcasts and bitcoin books, I have years worth of content to go through, not to mention medium blogs, substack newsletters, and articles on from around the web that I just don't have the time to read.
Contrast that with any other crypto project out there and it's just not the same. There are no Cardano podcasts. There are no books written about Chainlink. There are no conferences for Polkadot. There are no music festivals or magazines for Dogecoin.
There's simply no culture, no network, and no enthusiasm for crypto other than trading for profits. Whatever temporary enthusiasm there is for a project dissipates when the devs don't meet their deadlines and the airdrops stop flowing.
2. You Don't Need A Blockchain For That
The more I read and thought about bitcoin, the more I understood what it actually does, and why it's actually important.
Bitcoin works as money because money is information; it's data. The innovation that Bitcoin brought to the world was being able to verify this information without the use of a third party. I know I have bitcoin and you have other bitcoin, then I can give you some bitcoin and you can verify it's legit without the help of a trusted third party. It's a self-contained system that self-verifies.
Blockchain verification of money transfers makes sense. There is no such thing as physical bitcoin. I'm sending digital information from one person to the other. Other types of blockchains don't make sense. I can't send a digital avocado to someone. You can't live in a digital house. A digital receipt is not the physical thing.
Sure, you can create digital receipts that make sense, like a digital concert ticket or building entry card, but do you need that information to be global, transparent, and censorship resistant? Nope. Ticketmaster giving you a QR code or your local company having a private database works just as well.
Blockchains for businesses don't make sense either.
Independent verification of data without human intervention is what a blockchain does, which is why it's sometimes called triple entry accounting. The bitcoin network says Bob owns X and Alice owns Y, and this cannot be changed. Code is law. You cannot undo a bitcoin transaction. This is not something businesses want.
What would happen with blockchain-based real estate transactions? Let's say I buy a house, but someone steals my digital private key, or the key is lost – does that mean I no longer own the asset? Through legal documentation and a paper trail of transactions, I can prove that I purchased the property, but the blockchain says that someone else owns it.
Who is correct – the human legal system or the blockchain? Of course human intervention would be required in this case.
In a business setting, we want the ability to roll back any errors to make corrections, but this shouldn't be possible with a secure, trusted blockchain. Settled transactions are final on the blockchain. For businesses, it's much better to have a private database that you can freely edit.
3. The Competition For Money
Many people use digital gold as a framework for understanding bitcoin. This leads many people to think that if bitcoin is digital gold, then something else can be digital silver! In fact, this was Litecoin's main pitch for many years. In my opinion, this isn't true.
First off, gold and silver are not programmable like digital currencies. Silver was used as an alternative to gold because of gold's deficiencies, namely the lack of divisibility. Bitcoin is software. If it is lacking something, it can be upgraded or built upon to incorporate alternative technology.
Secondly, most people don't realize that silver and other precious metals other than gold are not really used as money. They have value, but lumber and corn have value too. Non-gold precious metals are expensive commodities, but are generally not used as money. For example, platinum is too rare and too expensive, so what would you ever buy with a platinum coin? Silver was replaced by the dollar as a “more divisible” solution to gold's divisibility problem. Both are mostly used as industrial metal and jewelry at this point. They are not used to store value or exchange goods anywhere in the world.
Everyone pretty much agrees that gold is the gold standard of precious metals. Bitcoin is the gold standard of cryptocurrencies. The demonetization of any other crypto blockchains will happen much faster.
4. If You Aren't In On The Premine, You're The Exit Liquidity
As I watched other cryptocurrencies trend toward zero, I started to understand the process of launching a token and where the money is actually made. People often think about striking it rich by finding the next dogecoin or random project that “moons” unexpectedly, but the probability of that happening is infinitely small.
The majority of profit from these token projects is made during the pre-sale or pre-mine, meaning most of the profits go to insiders. By purchasing the token at a predetermined price, which is lower than the initial listing price, they lock in their profits. As the coin moves upwards over the next weeks or months (these coins rarely last more than a year), they sell into strength, dumping on n00bs trading this garbage.
Of course, the website has a whitepaper, a roadmap, and a social media account to make things look like they are moving forward, but the reality of the situation is that by the time you get access to the token, the money has already been made. If you weren't in on the inside round before launch, you are the exit liquidity for early investors.
As a retail investor, in order to get life changing money from a project, you need to parlay a bunch of low probability events.
- have a significant amount of money invested in the project
- have enough liquidity in the market for you to sell without spooking other investors
- be an early investor
- time the market top
- not get FOMO and re-invest funds later
There are just too many variables that you have to hit right on the money in order to win this game of crypto guessing.
The only other group of people making consistent money from crypto trading are the influencers peddling these shitcoins to their followers. You see the “😱 face” YouTuber and Twitter chartbois posting their graphs about this or that coin which is in their top picks for the month, but what you don't see is how much they are getting paid to post this stuff. Often, they can make a fee simply by mentioning something innocent sounding like “I'm looking into this project”, or “What do you guys think about this coin?”
Bear in mind, that they don't actually own the coin. They are making fees off promoting it. Alternatively, they pre-buy the coin, mention it, then sell into the pump.
3 Arguments For Bitcoin Maximalism
If you are still not convinced that Bitcoin will be the only coin to survive this transition from government issued fiat money to open network digital money, I think these are three compelling arguments to consider. They aren't just about “bitcoin is better technology”, but logical, game-theoretical ideas.
1. Any Competing Chain's Success Undermine's Itself
If a new cryptocurrency would emerge and overtake the whole system as the “main crypto”, it could undermine the entire cryptocurrency market. If Bitcoin were to fail and something else to succeed, who's to say that wouldn't happen again?
Bitcoin succeeds, or nothing does.
2. All Digital Moneys Converge To One
Nobody seriously holds any alternative cryptocurrency with the idea that they'll use it as a savings account or pass it on to their grandchildren as a multigenerational asset. People trade altcoins, but the goal is typically to acquire more bitcoin.
Even if there was some niche use-case for a crypto token or crypto protocol it wouldn't make sense to hold it for the future. The token would be bought for its utility, then traded away for bitcoin when it was no longer needed. People may speculate on volatility in the short term, but they will always return to bitcoin for its security, brand, and network.
What would be the point of a second digital money with only marginal advantages? Given enough time, all other chains will die out as bitcoin absorbs their technology and they fail to achieve bitcoin's brand dominance.
Money tends to converge to one. This is how the entire world naturally evolved to all recognize gold as the most valuable money, despite having no centralized coordination. The main thing that slowed this process over thousands of years is the lack of physical connectivity and government borders.
In the digital world, there are no effective borders and communication flows freely. Those who are not on a bitcoin standard will quickly find out that bitcoin is better.
3. Bitcoin's Origin Story Cannot Be Repeated
Bitcoin's story is unique, and its history cannot be repeated. Not because of the people involved, and not because of the protocol design, but in a more literal sense. Bitcoin was invented at a time when no other cryptocurrency had been successful. It was incubated at a time when there was only a select few who knew about it, and they were able to nurture, promote it, and safeguard it from attack.
All other cryptocurrencies were invented in a world where bitcoin existed. Their path can literally never be the same as Bitcoin's. The bitcoin origin story can never be repeated because time only flows forward.
In the beginning, Bitcoin was largely ignored by the mainstream. There were no “insiders”. There was no initial coin offering or even a listing price. There were no exchanges. Enthusiasts mined bitcoin at a loss. The time they spent learning the code, discussing the potential ramifications for society, and engaging with other bitcoiners was not for profit. Nobody knew where we would be 10 years later.
These days altcoin projects and L1 protocols are venture capital funded. They have social media teams. They have a launch date and a road map.
We're bitcoin, but faster and cheaper.
We're bitcoin, but with smart contracts.
We're bitcoin, but with privacy.
In the early years of bitcoin, to actually acquire coins, you had to run a node and mine. You had to trade peer to peer. To acquire, secure, and trade your coins, you had to do the work. To get altcoins these days, you just get an exchange account and wait to see what new shit they list. The incentives in place for any new crypto project are starkly different from 2009.
What Is “Toxic Maximalism”?
The phrase “toxic bitcoin maximalist” started an insult to describe someone who simply couldn't find the capacity in their mind to make room for other crypto. Why do you have to be so mean and selfish? We're all on the same team! The term was quickly co-opted by stalwart bitcoiners and is now worn as a badge of pride by many – sometimes ironically, sometimes literally.
The definition of a toxic maximalist varies. It could mean insane assholes making death threats or people who just can't let something go and argue for hours on Twitter. So, what is a bitcoin maximalist vs a toxic bitcoin maximalist? It kind of depends on who you ask.
In my experience, the majority of people offended by bitcoin maximalists (AKA maxis or toximaxis) are not taking issue with any specific bad behavior. It's because bitcoin maximalists refuse to back down on certain issues.
A great example of this is when Moxie Marlinspike, the creator of Signal, an encrypted messaging app, announced that Signal would be introducing their own crypto token. Maximalists called him and the company out for their cash grab. There's no reason to introduce a messaging protocol native token with a floating value other than to enrich founders and investors who no doubt have a premined stake in the coin.
The token will not be decentralized. It will not be censorship resistant. If you want “crypto”, use bitcoin. If you want dollars, use a stablecoin. A native token doesn't make sense.
After days of mobbing from the bitcoin community, @moxie simply started blocking anyone with laser eyes, a hallmark trait of online profiles for bitcoin maximalists #laserraystil100k. He simply didn't want to engage with bitcoiners anymore. Was it annoying getting called out on your bullshit? I'm sure it was. That doesn't mean the maxis were wrong though.
The Benefits Of Toxic Bitcoin Maximalism
Oddly enough, on April 1, 2022, Vitalik Buterin, the person who coined the term toxic bitcoin maximalism wrote an article titled In Defense of Bitcoin Maximalism. In this article, the founder and defacto leader of the Ethereum project makes some very compelling arguments as to why Bitcoin maximalism exists and why it should continue to exist.
It's a little odd that he released this article on April first, which is April Fool's Day, but the article seems to be legit, honest, and makes a lot of sense. In fact, he even lays down some serious criticism of his own actions. Is he making a statement? Is it meant to be humorous? Is he just engaging in an intellectual exercise? Is it a double-fake and we need to read between the lines? Read the article and decide for yourself.
Toxic Bitcoin maximalism gets a bad rap, but my own personal experience is that it benefited instead of harmed me.
Back in 2017 when bitcoin was experiencing a hard fork, I was relatively new to bitcoin, but had a basic understanding of how it worked. As the saying goes, I knew enough to be dangerous (to my portfolio in this case). I remember posting in r/bitcoin about the benefits of both protocols, and trying to play middleman, seeing both sides of the argument.
Responses to my threads were not nice. I was bombarded with harsh, direct comments. Why did they have to be assholes? I was just asking questions and trying to find middle ground. Isn't compromise important here? We should have a positive discussion!
I didn't really enjoy the conversations I had at the time, but they stuck with me. I stewed on them for a year before I started my research into bitcoin, and step by step, those toxic maximalists started to make sense.
Only doubling the blocksize makes it almost impossible for an average user to run a node.
Allowing corporations and miners to fork the code sets a precedent for future hard forks.
Layers was the correct path to scaling, not on-chain
Though it was uncomfortable hearing harsh language from those individuals at that time, I see now that I was just a fresh n00b to the space and my concern trolling was not only old news, but it was also something that didn't need to be catered to. I eventually figured it out, and I say thank you to those bitcoin maximalists from 2017! Many critics of bitcoin eventually come around, as long as they have an open mind.
3 Arguments Against Maximalism
Though I consider myself a bitcoin maximalist, I do understand some interesting arguments against it. I don't 100% buy into the three points below, but I think they are worth considering.
1. Everyone Should Do What They Want
Just because some people choose to do idiotic things, that doesn't mean you should waste your time commenting on it. If bitcoin is legit, people will figure it out in their own time. Altcoins and crypto trading often serve as a gateway to bitcoin, which is why so many current maximalists came here by way of getting rekt in the altcoin markets.
At the end of the day, everything will shake out how it's meant to be. If people want bitcoin, they will devote resources to it, vote for it, buy it, exchange it, support companies that use it, etc. If people want something else, they will do that instead. I believe that in the end bitcoin will prove itself to be the only coin with the robustness to survive into the future, but I guess we'll see.
As a bitcoin maximalist you can do the most good for bitcoin by orange-pilling your close friends and family, supporting projects that are good for bitcoin, and engaging with positive, productive people who also love bitcoin.
2. Altcoins Provide A Shield To Bitcoin
Altcoins are great because they provide a regulatory shield for bitcoin. Regulatory bodies have a lot on their plates with outright scams like Bitconnect, OneCoin, and Ethereum Max, and they are just getting started with deceptive companies like Ripple and their XRP coin. With new tokens launched every day, it's impossible for them to keep up. Bitcoin is the least of their worries.
If others choose to sacrifice themselves and put their money into alts, it's none of my business. If you want to waste your breath defending decentralized oracles or smart contracts, go for it. You guys head for the front lines.
Attacks can come not just from social and political enemies, but also in the form of technical hacks. There have been many attempts to hack bitcoin before, and they've all failed. So why would an attacker waste resources trying to do what others have failed when they could just find an exploit in a new protocol? Altcoins are easy targets.
3. Altcoins Are Great For Experimentation
Maybe the most convincing argument for me is that altcoins are great for experimentation. In a global sandbox where anyone can write code for anything they want, even just one single good idea gleaned from an altcoin project could be immensely useful to bitcoin. Even when altcoins crash and burn, there are lessons to be learned. Better them, than us.
People are going to do what they want to do. Of course, it's sad to see talent wasted on crypto projects, and it's unfortunate that so many people will lose money investing in these tokens, but people have to arrive at ideas on their own. You can lead a horse to water, but you can't make him drink.
Great minds will eventually end up working on Bitcoin. Great ideas will be implemented on Bitcoin.
The Dumbest Anti-Maximalist Argument I Always Hear
There have been a number of “maximalist vs crypto” or “bitcoin vs altcoin” debates discussing many of the things I've written above. Without fail, the anti-maxi crowd always brings up something which is a bit of a pet peeve of mine because it doesn't make sense to me.
The argument is that there are lots of folks earning a living with altcoins, so what's the big deal? People are making life changing money or having their bills paid by trading crypto, so if you don't like crypto, you must not like those people making money! This is a straw man argument.
Obviously, people making money is good. The issue is that when you look at the profit aspect, you aren't seeing the full picture. Namely, there's another person on the other side of the trade. For everyone that makes money, there's someone that loses money.
With bitcoin, the story is different. People are trading bitcoin for goods and services. People are using real-world resources to mine bitcoin. People are putting bitcoin in cold storage for savings. There's utility to bitcoin. With altcoins, the only purpose seems to be trading, so for every positive trade, there is a negative trade. For every successful trader you hear about, there are many more failed traders, losing their asses in the crypto markets.
Turning altcoin profit into bitcoin or fiat cash doesn't make the case for altcoins because they are just a temporary gambling vehicle to acquire actual money.
Nobody is born a maximalist. Each individual has to take their own journey and make decisions based on what they observe and how they interpret it. I encourage you to do your own research and come to your own conclusions.
Let me explain my simplified thought process as I think about the broader crypto world and why bitcoin maximalism makes the most sense to me.
I look deep into my mind and try to consider the true nature of my interest in Bitcoin. In this internal discussion, I try to be honest when I ask myself:
Why am I buying bitcoin?
For me, the core reason I buy and hold bitcoin is monetary sovereignty. I hold the keys to my bitcoin. Nobody can force me to run different code. The number of units cannot be inflated by the government. No third party can stop my transactions. This is not possible with any other coin, especially since Ethereum moved to proof of stake.
Number Go Up is fun, but I really like having that individual power over my money. I can't get that with fiat, and I can't get that with altcoins.
This is my own thought process. What do you think about bitcoin maximalism vs a multi-coin world? Leave a comment and let me know!
- Bitcoin Maximalism Explained (Bitrawr Article)
- Bitcoin Maximalism (What Bitcoin Did Podcast, 4 Episodes)
- Bitcoin Maximalism, Altcoins, and Satoshi with Pete Rizzo (The Bitcoin Standard Podcast)
- The Origins and Evolution of Bitcoin Maximalism (Coindesk Podcast)
- Why Bitcoin's Toxic Maximalism Makes Sense (Bitcoin Magazine Article)
- Refocusing on Bitcoin (Stephan Livera Podcast)
- Andreas M. Antonopoulos – On Bitcoin Maximalism (Stephan Livera Podcast)
- Altcoins & Affinity Scamming (Stephan Livera Tweet)
- Can Toxic Maximalism Hurt Bitcoin (Bitcoin Magazine Article)
- Bitcoiners Are Not Toxic, They Have Integrity (Tomer Strolight Medium Article)
- Bitcoin Maximalism Is Dead, Long Live Bitcoin Maximalism (Forbes Article)
- Synonym Spaces – Bitcoin Maximalism (YouTube audio discussion)