That last is a huge impediment to big-business Bitcoin adoption. Most retail-tier HODLers are blissfully ignorant about this, but some leading Bitcoiners are well-informed about the problem. I recall that Greg Maxwell mentioned this, in some discussion of why he invented Confidential Transactions. Bitcoin ultra-maximalist company Blockstream uses CT in its Liquid sidechain, for the purpose of giving big businesses and institutional investors at least a modicum of privacy. I wouldn’t be surprised if some billionaires use Liquid and similar tools to break up the public view of their whale-HODLings. Meanwhile, moronic “crypto journalists” run headlines about “the biggest whale!!” to impress the n00bs. SAD.
Actually, that might be another good point that you are making D_W, and I would not characterize it as "sad" but instead a demonstration that there are a lot of folks who have hardly any clue and it is not necessarily a bad thing that they are engaged in some blissful renditions to describe what they believe is going on, [...]
I don’t think it’s sad that average people don’t understand how the world really works. That is simply a fact of life. It will sound arrogant for me to say, but it is the truth; and the world was a much more honest place when this fact was more widely acknowledged. The fact will always be a fact—but now, it is covered over in treacle, pretense, and pandering by politicians to the conceits of the masses.
What is sad to me here: Reporting on Bitcoinland is generally awful. Hold that thought.
Sadder: People who care about privacy have done a poor job of promoting it. It is an issue that I grapple with myself.
I have generally done a poor job, too.
Different people get different aspects of this issue; but who gets the whole thing? To illustrate, take two opposite poles: Blockstream versus Zcash.
Everyone here will love Blockstream, because they are the practically a corporate symbol of Bitcoin maximalism. But how many know what they actually do? They are primarily a B2B company. Aside from some B2C projects such as their acquisition of Green, and their Blockstream Satellite project which is essentially altruism (not only B2C, but made to help poor people in poor countries use Bitcoin!), well—where does Blockstream make their money? I don’t know their internal structure or their financials (none of my business!), but I plausibly guess that their bread and butter is Liquid, and their Lightning infrastructure projects, and their hosted mining—all B2B, and/or for very wealthy customers.
Blockstream cares about privacy, so what do they do? Add some minimal privacy to Liquid, which is NOT a consumer-facing project. (I say “minimal”, because I don’t consider CT sufficient—not nearly.)
On the other end of the spectrum, objectively consider Zcash. Most people here will knee-jerk hate them, “because altcoin”. Well, frankly, their coin has been mismanaged. I think that the dev team are aces at their technology, but naïve about economics and business. It shows. I say that as a constructive criticism; I sincerely wish that they had done better.
It is primarily a consumer-facing project, and that also shows. They
have done some purely B2B work (including, infamously, some contract work for JPMorgan Chase on ZK proof tech). They
have done outreach to businesses—to promote B2C use of Zcash. They have nothing like Blockstream’s promotion of Liquid—the opposite pole; most consumers have no idea what Liquid is!
Why can’t we have everything in one place? Businesses and consumers both have the same basic need:
Privacy. And it is also one issue where billionaires and Average Joe have the same basic need—perhaps manifested differently, but the need is the same. Billionaires and Average Joe also both need to eat food, even if one dines on filet mignon as the other eats hamburgers.
We need people to stand up for
Bitcoin and say, everybody needs privacy! Businesses need it to protect their financials and their internal operations from competitors. Individuals need it for
human dignity, plus many other reasons. The only people who don’t want it are those who have ulterior motives for mass-surveillance (including “surveillance capitalism”), or those who swallow the propaganda dished out by those with ulterior motives. Is that a sufficient reason for us to be deprived of something that
everybody needs?
Now, look again at that reporting. It moves things in exactly the wrong direction. There is a bad meme in Bitcoinland: The belief that “whale wallets” can all be identified. (Or that Glassnode stats for STH/LTH are anything better than vague guesses.) Such memes tends to frame discussions—to frame people’s
mindsets in a way not conducive to privacy. Bitcoiners have learned wrong information. To attain real privacy in Bitcoin, we need for people to unlearn that wrong information.
Blockchain transparency in Bitcoin is a bug, not a feature. It wound up that way because Satoshi needed to choose between a centralized, private system like Digicash, or a decentralized, totally public system. To achieve the latter, he himself needed to make a revolutionary breakthrough in the field of Byzantine fault-tolerant distributed consensus. He lacked the privacy technology that we have today—development of which was largely motivated by Bitcoin.
But since Satoshi made it that way
because he had no better choice, blockchain transparency and its implications have been sold as “features”—often by evil people with vicious motives, such as Mike Hearn. Hell, I have even seen essays by Craig Wright proclaiming that “Satoshi’s Vision” is to make all financial transactions absolutely public, and Blockstream is
criminal for conducting any transactions at all off-chain with Lightning.
There is
no reason whatsoever to make all financial transactions transparent and public!
Every alleged legitimate use case for blockchain transparency can be better solved in other ways: Proof of solvency, auditing, etc.
Once we get rid of the bad meme that there can be such a thing as ranking “whale wallets” based on public blockchain data, we will be much closer to having people unlearn the more general bad idea of a totally transparent global public ledger.
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