Found via Artemis3’s excellent response:I hope everyone who gives a darn about Bitcoin avoids doing business with Bitmain in the future. Bitmain has been a long standing bad actor in the cryptocurrency ecosystem. We shouldn't forget this just because they replaced their CEO. As far as I know they have done nothing to undo the damage they've caused or otherwise make amends. We can see by their continued open source license violations in their products that they haven't changed.
I will award merit to every post that makes a compelling statement against buying from bitmain.
Artemis3 said everything that I usually would have, plus more; and the discussion thus got me thinking about Bitmain. What is their strategy, on a deeper level?
Well, let’s talk business. Most people on this forum know me for being suicidally principled; but I do understand business, in a purely pragmatic sense. And, “business is business.” Mining is a for-profit activity; miners obviously don’t want to shoot themselves in the foot financially with poor business decisions based only on idealism. Of course, one of Bitcoin’s finest qualities is how effectively it
aligns self-interest incentives with the greater good of Bitcoin; and if Doing The Right Thing makes business sense, then you must be incredibly stupid to do otherwise.
My flash of insight here:
When you buy from Bitmain, you are funding a hostile competitor. Not only as a miner, but as an investor in Bitcoin. Moreover, you are incurring a dependency of your business on a hostile competitor. All of this is sheer idiocy, from a perspective of “strictly business”.
I observe that Bitmain attacked Bitcoin’s uniqueness. Anyone who has studied the nature of money should know how detrimental an
attack on uniqueness is, without further explanation. Moreover, Bitmain are not only willing, but
overly eager to make ASIC miners for altcoins—even for altcoins that deliberately attempt ASIC-resistance. I followed the Zcash backpedalling on their ASIC-resistance promise, and Monero’s repeated hardforking of their proof-of-work algorithm while they developed RandomX
(and if there were one altcoin feature that I could steal for Bitcoin, it would be RandomX—yes, I know why that will probably never happen; don’t bother explaining). Bitmain has invested serious resources on all fronts to make a giant, undifferentiated market of lots of coins, in which all coins are just coins mined by Bitmain.
Bitmain is not only an ASIC maker: They are an ASIC-maker whose self-evident strategy is to proliferate the market for mining hardware in every way they can, no matter how that may damage the market in other ways. They don’t want for any particular coin to be uniquely valuable: They want a general market of cryptocurrencies where one is pretty much the same as another, and no matter which one you choose, you will buy a Bitmain miner for it. Meanwhile, they themselves can mine them all, and dump them all—it’s all the same to them.
At this juncture, I recall a
vintage Joel on Software strategy letter:
Smart companies try to commoditize their products’ complements.
My analysis:
Bitmain seeks to commoditize cryptocurrencies as such. Note the plural.
For HODLers of
any cryptocurrency, this is disastrous. For miners of
any cryptocurrency, this is even worse, insofar as
you are paying for the privilege of having your worst strategic competitor actively attempt to undermine your whole market.Miners who buy Bitmain are, of course, buying from their
direct competitor in the mining business. I have never understood why people do this. You pay Bitmain top bits for fast hardware, and thus fund Bitmain and Bitmain-operated pools to compete against you in hashrate. You even buy from a direct competitor who was
most probably deploying covert ASICBOOST in secret back around early 2017; so you know that they will play dirty tricks to gain an unfair competitive advantage against you. You also know, as Artemis3 pointed out, how generally hostile they are to their own “customers”, with their history of control-freakery over business-critical capital hardware that you
thought you actually bought from them—even to the point that they have sometimes “sold” you miners that came with their ability to remote-brick “your” business (!). And you keep paying them!?
All this is simple,
tactical, obvious at the surface; how do people not realize it, other than total thoughtlessness?
Whereas my point here is much deeper, and accordingly even scarier. If you HODL any coin—not only Bitcoin, but
any coin—then Bitmain is working to undermine the long-term value of your investment on a
strategic level. And if you fork over your capital investment money to Bitmain for mining hardware, you are forking yourself over in the long term.
Think business-wise. Think about how best to grow and protect your own wealth in the long term. Be guided accordingly.
This is a specific, concrete instance of a general, abstract point that I have been urging for awhile now:
If you have any Bitcoin, whether you have 1000 BTC or only a few precious satoshis, then an attack on Bitcoin is an attack on your wallet. You may or may not care about Bitcoin’s noble principles. You will defend those principles, to defend the value of your money.
Part of the genius of Bitcoin is that it turns greed and selfishness toward the common good: If you have Bitcoin, you want to protect your savings, so you must stand against people who try to devalue it. Otherwise, you risk losing your savings.
Everybody who has Bitcoin, has an incentive to protect Bitcoin. If you have Bitcoin, then you are making the world a better place when you defend the value of your own money. You can’t avoid protecting Bitcoin, if you want to protect your own money. And if you have Bitcoin, then an attack against Bitcoin is not only an attack against some idealistic theory: It’s a financial attack on you, personally! Of course, you should be angry about that.
As a Bitcoin idealist, I understand that many people couldn’t care less about Bitcoin principles.
As a HODLer who gets hit in the wallet by the destructive market effects of fork-attacks against Bitcoin, I
do not understand why many other people don’t seem to care about the value of their own money. Please. Be more selfish. It’s good for Bitcoin, and good for you.
Full disclosure: I have a
personally significant financial interest in Bitcoin. I have skin in the game, and Bitmain’s strategy is thus adverse to me, me, me. A considerable part of my enmity for Bitmain is driven by pure self-interest. You see how that works?
