Lead developer quits bitcoin saying it 'has failed'

[ShakinHandz]

Bitcoin slid by 10 percent on Friday after one of its lead developers, Mike Hearn, said in a blogpost that he was ending his involvement with the cryptocurrency and selling all of his remaining holdings because it had "failed".

Hearn, one of five senior developers who has spent more than five years working on the web-based currency, said he would no longer be taking part in development.

"Despite knowing that bitcoin could fail all along, the now inescapable conclusion that it has failed still saddens me greatly," Hearn said in his post on blog-publishing platform Medium.

Along with Gavin Andresen, who was chosen by bitcoin's elusive creator Satoshi Nakamoto as his successor when he stepped aside in 2011, Hearn has been locked for months in a battle with the other lead developers over whether the "blocks" in which bitcoin transactions are processed should be enlarged.

Each block currently has a capacity of one megabyte, which Hearn says is "an entirely artificial capacity cap", and allows a maximum of just three payments to be processed per second.

In August, Hearn and Andresen released a rival version of the current software, called Bitcoin XT, which would increase the block size to 8 megabytes, allowing up to 24 transactions to be processed every second. While that is still a fraction of the 20,000 or so that Visa can process, it would increase every year, so that bitcoin could continue to grow.

But the new software has not been adopted by the "mining" computers that secure the network, the majority of which are in China, according to Hearn.

Hearn says the bitcoin network is about to run out of capacity as the volume of transactions increases. And when that happens, the network will become unreliable, with payments unable to be processed and vulnerable to fraud.

"If an IT system runs out of capacity like that then all kinds of things go wrong – all hell breaks loose," he said in an interview with Reuters in late December.

Hearn reckons the bitcoin community has "failed" in its governance of the crytocurrency's code.

"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," he wrote.

SUDDEN DEPARTURE

Just months ago, in August, Hearn told Reuters that whether or not Bitcoin XT was adopted, the crypocurrency would live on. "If we thought it might be the end of bitcoin, we wouldn't do it," he said then.

Bitcoin was trading at around $390 on the itBit exchange BTC=ITBT by 2000 GMT, down from $430 before Hearn's blog post was published.

In his December interview, Hearn said that when people realised that the bitcoin network was at breaking point, the price would fall.

"The current price of bitcoin is supported almost entirely by people speculating on its future, in the assumption that this could be the money of tomorrow," he said. "So if the network starts to collapse, then a lot of people are going to look at it and say: well maybe we've miscalculated (its) future value."

Hearn is now working for the R3CEV consortium of banks working on using the blockchain technology that underpins bitcoin in financial markets.

Stephan Tual, the former chief operating officer of blockchain firm Ethereum, who now works at blockchain-based app developer Slock.it, also reckons bitcoin's future looks shaky.

"Bitcoin is outdated technology - almost prehistoric by crypto standards," he said. "It's because of petty quarrels such as these that it hasn't been able to evolve in five years."

Others were more upbeat.

"I'm not ready to declare that Bitcoin has failed," wrote U.S. venture capitalist Fred Wilson.

"Sometimes it takes a crisis to get everyone in a room... So if we are going to have a crisis, let's get on with it. No better time than the present."
-Source Internet

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[ShakinHandz]

I sold My 30BTC @ 406$ , to get some Fiat?
what i did was right Or wrong ? would like to hear from you guys.

[prodigy8]

I sold My 30BTC @ 406$ , to get some Fiat?
what i did was right Or wrong ? would like to hear from you guys.

You did a good job then you got $12,180, now with these money you can get nearly 33BTC which means 3BTC profit.

About the developer which quits bitcoin i don't think we should make any panic, it's his decision and bitcoin will continue its journey.

[Boelens]

I sold My 30BTC @ 406$ , to get some Fiat?
what i did was right Or wrong ? would like to hear from you guys.

That's really good. Prices are low right now and you either got out of it good or you can buy back and get more bitcoin back. But selling at 400+ was definitely the right play here.

[calkob]

He has, but why should we really care, due to the story more people will probably here about bitcoin......   and you know that anynews is good news its PR.  Bitcoin is still working it aint broken.  untill i see my node actually shit itself infront of me i'm gona keep buying.....

[notbatman]

What are the odds that Darth "Rage Quit" Hern shorted BTC with the fiat he got from flipping his stash before his blog post and planned to re-invest the profits when hit the floor (about 5 hours ago)?

[lenoli]

I sold My 30BTC @ 406$ , to get some Fiat?
what i did was right Or wrong ? would like to hear from you guys.

for now, its good, bun you must buy some btc now, because i am sure soon it will raise again

[n2004al]

There is a very bad situation for bitcoin since I remember to know it and maybe since its born. From to many directions are coming news which predict the end of it. Beginning with the admission of the problems of Cryptsy and the writing - full of bad news and problems existing within the team of core developers - made by Mike Hearn. Then the strong drop of value of bitcoin within few days (after a fantastic period of stability). I remember the time after MtGox. Was the same situation but the bad news was only one. The bankrupt of MtGox and the bitcoin suffered only this. Today are more. And no one know if will stop here this storm. Will survive bitcoin? I think yes. But only the time will verified this. If yes I will be again back to this post and thread to remember this very bad moment for everyone who like bitcoin and has followed and believed on it.

[Sereneum]

He has, but why should we really care, due to the story more people will probably here about bitcoin......   and you know that anynews is good news its PR.  Bitcoin is still working it aint broken.  untill i see my node actually shit itself infront of me i'm gona keep buying.....

This made me laugh and yeah, I agree. It still seems to be working pretty well for what I want to use it for.

[HeroCat]

Bitcoin market is very large and with worldwide spreading. So it will be stable in future, and some changes in BTC price can be always 

[7425504]

I sold My 30BTC @ 406$ , to get some Fiat?
what i did was right Or wrong ? would like to hear from you guys.

I think you are right, bitcoin will not die, but may have a period of ice, let us look forward to bitcoin's return, the price rise

[LiteCoinGuy]

Mike failed. Bitcoin moves on.

[ShakinHandz]

There is a very bad situation for bitcoin since I remember to know it and maybe since its born. From to many directions are coming news which predict the end of it. Beginning with the admission of the problems of Cryptsy and the writing - full of bad news and problems existing within the team of core developers - made by Mike Hearn. Then the strong drop of value of bitcoin within few days (after a fantastic period of stability). I remember the time after MtGox. Was the same situation but the bad news was only one. The bankrupt of MtGox and the bitcoin suffered only this. Today are more. And no one know if will stop here this storm. Will survive bitcoin? I think yes. But only the time will verified this. If yes I will be again back to this post and thread to remember this very bad moment for everyone who like bitcoin and has followed and believed on it.

will sure look for it , any situation will be favorable for me , i have seen time when bitcoin was 45 usd.
I am just shocked to see the news.

[Etoiliste]

Mike failed. Bitcoin moves on.

yeah i don't think that the major holders of bitcoin can let it go dawn easily because there is all new companys that deals with bitcoin and it could just be a way to Mike get more profits when bitcoin goes down he buys more and then sellit back when it gets higher

[Anddos]

Even though the price goes up and down everyday still he got a good price IMO. But I still don't think that bitcoin will die.

[onlinedragon]

When one leaves another one will join the team. Or don't they work that way like an normal company.

[RodeoX]

Mike failed. Bitcoin moves on.

I heard Mike failed because he's not backed by anything! And he's a ponzi!!! 

lol, na. Best of luck Mike. 

[TippingPoint]

Dogs howl, but the caravan moves on.

[MRKLYE]

Mike failed. Bitcoin moves on.

Hahahaha. THIS.

Thank you for finding the words I was looking for.

[kevin go]

in which part bitcoin has failed?
i dont think so..still many people using bitcoin and looking for bitcoin.price is going to stable right now..not too high and low..
or mike just fail in trading or gambling or got into ponzi site?