DO BITCOIN DEVELOPERS REPRESENT A MASSIVE COUNTERPARTY RISK?

[headingnorth]

So in theory bitcoin is supposed to work on consensus. The developers should respect the wishes of the community when implementing any kind of updates or changes to the code.

But in practice consensus is unenforceable and therefore completely optional. As we have seen the latest version of Bitcoin version 30 had no consensus at all and yet it was rammed through anyway. Which shows that the devs could force through any kind of unilateral changes (malicious or otherwise) to the network code anytime they want and there is not much anyone could do about it. This is the elephant in the room that no one ever talks about. In response the nodes could simply switch to an alternative node software but the damage would have already been done and crashed the market. It would take months if not years for bitcoin to recover. And not many nodes would make the switch in the face of clear malice. Why? Because people tend to be sheep and will do whatever the status quo wants them to do. All it takes is 10 per cent or so of the nodes to run the malicious software to do a great deal of damage to the network.

The other problem is there is no telling how many nodes are controlled by the devs themselves or their donors. Bad actors only need to control a very small percentage of the nodes to force the network to run their malicious code. There is no limit to how many nodes can be started by anyone.  So if they wanted to bad actors could simply start up and run more and more nodes to gain greater control of the network. And bitcoin's decentralization is also questionable when ninety percent of bitcoin devs are based in the US and hence subject to US laws and regulations that can suddenly change at anytime, subjecting them to political and regulatory pressure from the US government, pressure from other public and private actors, etc.

The idea that bitcoin devs are all a bunch of lone independent cypherpunks in white hats who can never be influenced by political pressure or multi-million dollar paydays from Wall Street
VCs is naive at best. There is no telling who the devs are actually working for or getting paid from but we do know their funding sources include Blackrock and crypto VCs.  

So yeah, the devs are clearly prioritizing their own personal financial interests not yours and mine and not what is good for the network. Decentralization and lack of counterparty risk or trustlessness is supposed to be two of bitcoin's greatest strengths. But in practice these things are a myth IMO but I would love to be proven otherwise. When I came to this realization is when I started to gradually dump my bitcoin early last year after hodling for years.

[Ambatman]

I'd like to point out something
It wasn't a consensus level change but a policy change in Bitcoin core not Bitcoin
And users have every right to choose not to update or can switch to other client.

Which shows that the devs could force through any kind of unilateral changes (malicious or otherwise) to the network code anytime they want and there is not much anyone could do about it

Not true
Consensus rule are what dictates which block is valid and if seen malicious
There would be a chain split and miners,nodes ,exchanges and the likes would choose which to follow
And the majority wins. Consensus rule.  

Why? Because people tend to be sheep and will do whatever the status quo wants them to do.

If they were I don't think they would be running a node

[retaur]

The people are sheep and favour the status quo is usually people not wanting change.

Devs don't have the almighty power and if you wanted to change something, most devs are open to collaboration - particularly in open source areas.

The community typically encourages voting on rules too by altering mempool protocols on their own nodes and suggesting others do the same. I'd say money might buy developer attention but they recently reduced the minimum transaction fee on the protocol level (iirc) and I feel that's something they likely wouldn't be paid to do.

[headingnorth]

I'd like to point out something
It wasn't a consensus level change but a policy change in Bitcoin core not Bitcoin
And users have every right to choose not to update or can switch to other client.

Which shows that the devs could force through any kind of unilateral changes (malicious or otherwise) to the network code anytime they want and there is not much anyone could do about it

Not true
Consensus rule are what dictates which block is valid and if seen malicious
There would be a chain split and miners,nodes ,exchanges and the likes would choose which to follow
And the majority wins. Consensus rule.  

Why? Because people tend to be sheep and will do whatever the status quo wants them to do.

If they were I don't think they would be running a node

I don't know if there is much difference between policy and consensus in terms of enforcement. Regardless the op-return changes were highly controversial.

But regardless I don't see how even consensus level changes can be enforced. The Core developers have full control of the code. There is nothing preventing them from making any kind of changes to it whether the community agrees or not. I don't even know how you define consensus with bitcoin. It's not like a one man one vote sort of thing or one node one vote.

Bitcoin consensus seems to be very subjective that is based entirely on community sentiment, which can be broadly interpreted to mean anything.
Other cryptos have a more structured voting system with such things like governance tokens that are used by token holders to vote on changes to the rules, code and development, etc.

But with bitcoin the consensus mechanism seems to be very vaguely (and poorly) defined. It appears to be  based on little more than "sentiment" which can mean anything.
But admittedly I'm not familiar with the details.

[Ambatman]

I don't know if there is much difference between policy and consensus in terms of enforcement. Regardless the op-return changes were highly controversial.

Consensus are unbreakable rules that defines what makes a block or transaction valid
While policy rules are optional
They are local rules node operators use to decide what transaction they adding to their mempool.
For example a container was created to accept any liquid
But you like yours accepting only water.
Liquid is consensus choosing water is policy
Accepting alcohol isn't wrong but you chose not to that's the difference between consensus and policy rules.

The Core developers have full control of the code

No they don't. Bitcoin is open sourced and decentralized
And people have pull request which are reviewed by the community and if it receives green light it's merged
The control I can say is that they have the final say over what get merged but that's only on Core.
Bitcoin core isn't Bitcoin.

Other cryptos have a more structured voting system with such things like governance tokens that are used by token holders to vote on changes to the rules, code and development,

This is why POS is considered centralized
The more coin you own the better your vote
While Bitcoin follows practicality
If majority choose a route it means that route is the right one
So we cast vote by our actions not vote.

[headingnorth]

I don't know if there is much difference between policy and consensus in terms of enforcement. Regardless the op-return changes were highly controversial.

Consensus are unbreakable rules that defines what makes a block or transaction valid
While policy rules are optional
They are local rules node operators use to decide what transaction they adding to their mempool.
For example a container was created to accept any liquid
But you like yours accepting only water.
Liquid is consensus choosing water is policy
Accepting alcohol isn't wrong but you chose not to that's the difference between consensus and policy rules.

The Core developers have full control of the code

No they don't. Bitcoin is open sourced and decentralized
And people have pull request which are reviewed by the community and if it receives green light it's merged
The control I can say is that they have the final say over what get merged but that's only on Core.
Bitcoin core isn't Bitcoin.

Other cryptos have a more structured voting system with such things like governance tokens that are used by token holders to vote on changes to the rules, code and development,

This is why POS is considered centralized
The more coin you own the better your vote
While Bitcoin follows practicality
If majority choose a route it means that route is the right one
So we cast vote by our actions not vote.

Thank you for the explanation. I did run a Start9 Knots node but I'm not a coder, nor do I know how to read code.

So my question is, who is doing the actual voting under bitcoin consensus?  The developers? The node operators? The bitcoin holders? Or someone else?
How do we know or see the results of the votes?

So let's say the node operators are the ones casting the votes. That would seem reasonable to allow node operators to vote. But how do we know who is controlling the nodes?
What if an entity like Blackrock or Andresson Horowitz are controlling a large number of bitcoin nodes (perhaps hundreds or even thousands) therefore controlling a large percentage of the votes?

Then you could end up with the same problem of highly centralized power and influence as with POS.  
If I'm not mistaken Bitcoin's consensus mechanism is simply nothing more than what node OS the majority of nodes are currently running. But I could be totally wrong.  

[Rustam Meraj]

In my work on current spread of nodes, I have noticed that network is becoming more open to Sybil attacks where rich nodes can fill network with cloud based nodes in large numbers so that they could pretend that they support use of bad changes.
I believe that on the one hand, math code of Bitcoin is standing firm, but human layer has been changed into Wall Street backed teams of tech rebels in US. So, it seems to me that you were in sensible path to sell because dream of company capture free rebel tool is being turned into controlled financial product in hands of people that own money and mockingly called merge button.
Clear proof for many was update v30.0. I think that when network needs standard choices of some large businesses, it is no longer community run, but it is just shared database whose board of directors is corporate. We are seeing death of Social Agreement to give way to Company Speed.

[headingnorth]

In my work on current spread of nodes, I have noticed that network is becoming more open to Sybil attacks where rich nodes can fill network with cloud based nodes in large numbers so that they could pretend that they support use of bad changes.
I believe that on the one hand, math code of Bitcoin is standing firm, but human layer has been changed into Wall Street backed teams of tech rebels in US. So, it seems to me that you were in sensible path to sell because dream of company capture free rebel tool is being turned into controlled financial product in hands of people that own money and mockingly called merge button.
Clear proof for many was update v30.0. I think that when network needs standard choices of some large businesses, it is no longer community run, but it is just shared database whose board of directors is corporate. We are seeing death of Social Agreement to give way to Company Speed.

Interesting perspective that seems to confirm the thesis presented in my OP. Not that I am happy about it because I would prefer to be proven wrong.

The bitcoin motto is "Don't trust VERIFY." But how can we verify that bitcoin is actually even decentralized without knowing who owns and controls the nodes?  

The fundamental problem appears to be we can't verify it because the nodes are anonymous.

[Azulon]

I think this raises legitimate concerns about governance, but some of the conclusions go a bit too far. Consensus in Bitcoin isn’t enforced socially, it’s enforced economically. Developers can publish any code they want, but they cannot force anyone to run it. A release having “no consensus” doesn’t mean much unless miners, nodes, exchanges, and users actually adopt it. Bitcoin Core v30 didn’t change consensus rules, and optional software updates aren’t the same thing as unilateral protocol changes.

[headingnorth]

I think this raises legitimate concerns about governance, but some of the conclusions go a bit too far. Consensus in Bitcoin isn’t enforced socially, it’s enforced economically. Developers can publish any code they want, but they cannot force anyone to run it. A release having “no consensus” doesn’t mean much unless miners, nodes, exchanges, and users actually adopt it. Bitcoin Core v30 didn’t change consensus rules, and optional software updates aren’t the same thing as unilateral protocol changes.

Yes the updates are optional, but most node operators are not coders and will update to the latest release simply because they believe the latest version will fix any bugs
and make other improvements. Just like 99.9% of Windows and Mac PC users are not coders and will automatically update their OS to the latest version without thinking about it.

So I think it is a bit presumptuous to assume the node operators will always serve as an effective line of defense to potentially bad updates. Not being coders themselves
they have to take the word of those doing the coding. And bitcoin coders are known to be not always honest about what they are telling you.

But you are also ignoring the question of who controls the nodes. For example, how do we know that some large corporate entity (or more than one) doesn't control half
of the current active bitcoin nodes, therefore controlling a disproportionate share of the voting power?  

[DaveF]

.....So my question is, who is doing the actual voting under bitcoin consensus?  The developers? The node operators? The bitcoin holders? Or someone else?
How do we know or see the results of the votes?...

The miners. They are the only ones that really matter. You can run whatever node you like with whatever rules you like. Since day one unless you are mining you didn't and don't get a vote. Now that mining mining pools exist if you want proposal "X" you would find a pool that is signaling that and mine there.

Very very basic: Go back to 2017 with the BTC - BCH block size fight. At the end of the day miners mined BTC not BCH.
There was a lot of other things going on at the time but more or less you could see who was signalling what.

Nothing has changed since then.

-Dave

[headingnorth]

.....So my question is, who is doing the actual voting under bitcoin consensus?  The developers? The node operators? The bitcoin holders? Or someone else?
How do we know or see the results of the votes?...

The miners. They are the only ones that really matter. You can run whatever node you like with whatever rules you like. Since day one unless you are mining you didn't and don't get a vote. Now that mining mining pools exist if you want proposal "X" you would find a pool that is signaling that and mine there.

Very very basic: Go back to 2017 with the BTC - BCH block size fight. At the end of the day miners mined BTC not BCH.
There was a lot of other things going on at the time but more or less you could see who was signalling what.

Nothing has changed since then.

-Dave

Interesting. If you are correct (which you may very well be) that miners have all the power then it would seem bitcoin isn't decentralized at all.
That is just as bad as the developers having all the voting power. Either way you get a lot of power concentrated in the hands of the few.
 
So in this case the miners would be economically incentivized to mine as many non-monetary spam transactions (monkey jpegs, NFTs, memecoins, etc.)
that they can, transctions that have little or nothing to do with bitcoin as a monetary asset. Bitcoin might then turn into little more than a glorified memecoin.

That explains the release of Core version 30 which enables unlimited spam onto the network.

[DaveF]

Interesting. If you are correct (which you may very well be) that miners have all the power then it would seem bitcoin isn't decentralized at all.

Why would you say that, anyone can buy a miner and mine.
https://cryptorank.io/news/feed/fec8e-solo-miner-with-futurebit-earns-3-125-btc

Even in the past week 20 different pools have found blocks:
https://mempool.space/graphs/mining/pools#1w

Core 30 changed nothing in the amounts of what you consider spam could be mined.
Greg says it better then I could.

There is absolutely no perceivable increase in >80b op_return,

What does "perceivable" mean to you?  OP_returns aren't 'perceivable' at all generally because the bitcoin software intentionally doesn't show them.  There are op_returns over 80 bytes, as there were *before* Bitcoin Core 30 because, as I just reiterated in this thread and which you went on to lie about again:  Miners already removed the limit before a matching removal was proposed in Bitcoin Core.  You claimed that this would bring forth all kinds of negative effects, we can all see now that your hysterics were entirely misplaced ... and they continue to be misplaced.

If you don't like these simple facts start your own pool and get people to mine there. Or just buy some miners and mine for yourself.

-Dave

[PrivacyG]

I believe you forget a few very important things when thinking about this risk.

First of all.  Like Dave says, we can not only look at Pools and Miners, we can start Mining by our selves.  So even if there is a real possibility that Corporations start accumulating a lot of the voting power, the rest of us can always fight back by becoming Miners our selves and minimizing their dominance in turn.  This can be a war that is fought back and forth between Corporations and us regular people but it finally comes to a point where it is financially not viable any more to continue fighting as a Corporation.  After all, they do not have unlimited Money and there is not an infinite supply of Mining equipment either.

It does not sound to me at all like Miners having the voting power means Bitcoin is Centralized because while it is not the same comparison, it is like saying the citizens of a country having the voting power means the country is not democratic.

But second of all.  Unlike Shit Coins and other GitHub repositories no body heard about, Bitcoin is actually audited by people who know coding and are very interested in knowing every single line of code that lays behind the Decentralized Currency they are using.  I admit this means we pretty much Trust each other that there are some people who do this when in fact there is a possibility that we end up with every body Trusting each other in a blind way while no body audits the code.

But in reality this can not happen.  First of all, the code is already being automatically audited by people who are constantly looking for vulnerabilities and ways to 'crack the code'.  There are many people who are actively trying this.  Others are suspicious about the contributions a particular Developer came with so they will audit the new changes them selves to make sure they are not being misled and lied to.  There are even companies working on auditing the code so at the end of the day you can probably sleep well knowing there are a lot of eyes constantly on the code particularly when new lines and changes appear to make sure that their own Asset is Safe from what ever a bad person may try to do.  Look up 'Bitcoin audited code' and you will find many independent audits and even companies providing audited Security of Bitcoin.

Like I said.  This is a project that is way too large to have a malicious code inserted and not noticed.  Any similar problems were solved in the past so I do not fear this scenario at all.  Bitcoin is currently as Decentralized as it can be.  If any of us wants to make a change by lowering the dominating power of others, we can do like Dave says and start Mining our selves.

[headingnorth]

Come on get real, how much bitcoin is mined by the home-based hobbyist miner these days?
The hashrate controlled by such small-scale miners is neglible at best.

This isn't the year 2012 anymore when most of the hashrate was produced by guys mining bitcoin in their basement.
Today that kind of activity is probably no more than 1 to 2 per cent of the hashrate at best.

The top 6 mining pools today produces 90% of the hashrate. And the top 10 to 15 big pools takes up nearly all of the rest.
There is little if any economic incentive to mine bitcoin in your house. Unless you live in the middle of nowhere where you have access to
very cheap stranded energy, it will cost you a lot of money in energy costs. Your odds of ever successfully mining a block as an independent micro-scale miner
is one in a million at best.    

[Sticky Bomb]

If I'm not mistaken Bitcoin's consensus mechanism is simply nothing more than what node OS the majority of nodes are currently running. But I could be totally wrong.  

No you are wrong, Bitcoin consensus is whatever rules the majority of economic mining nodes enforces, regardless of the OS they choose to run. Nodes can run on linux, windows, MacOs, e.t.c, nodes can run on different OS and can still agree as long as they enforce the same consensus rules. The OS they run on is just the environment, the rules they enforce are what really matters.

If you were referring to software version, it counts but is not automatic, nodes still choose which rules to enforce even after updating, the updates doesn't automatically get enforced, the nodes can agree to run it or not. You can still run a compatible version you prefer and you would be just fine. Developers doesn't have the right to change consensus automatically unless the nodes agrees to it.

[ABCbits]

.....So my question is, who is doing the actual voting under bitcoin consensus?  The developers? The node operators? The bitcoin holders? Or someone else?
How do we know or see the results of the votes?...

The miners. They are the only ones that really matter. You can run whatever node you like with whatever rules you like. Since day one unless you are mining you didn't and don't get a vote. Now that mining mining pools exist if you want proposal "X" you would find a pool that is signaling that and mine there.

Very very basic: Go back to 2017 with the BTC - BCH block size fight. At the end of the day miners mined BTC not BCH.
There was a lot of other things going on at the time but more or less you could see who was signalling what.

Nothing has changed since then.

-Dave

And if we go back to SegWit2x, many mining pool signal SegWit2x[1]. But in the end it doesn't happen since it had little support from "general" Bitcoin community and Bitcoin services, so they decide not to proceed since it could lead to Bitcoin price decline or birth of another forked coin.

[1] https://web.archive.org/web/20171004085820/https://xbt.eu/

[Azulon]

I think this raises legitimate concerns about governance, but some of the conclusions go a bit too far. Consensus in Bitcoin isn’t enforced socially, it’s enforced economically. Developers can publish any code they want, but they cannot force anyone to run it. A release having “no consensus” doesn’t mean much unless miners, nodes, exchanges, and users actually adopt it. Bitcoin Core v30 didn’t change consensus rules, and optional software updates aren’t the same thing as unilateral protocol changes.

Yes the updates are optional, but most node operators are not coders and will update to the latest release simply because they believe the latest version will fix any bugs
and make other improvements. Just like 99.9% of Windows and Mac PC users are not coders and will automatically update their OS to the latest version without thinking about it.

That’s a fair concern, and I agree that many node operators aren’t coders and tend to update out of trust rather than deep review. That trust element is real, and it’s probably under-discussed.

Where I still disagree is on the idea of “voting power.” Nodes don’t have voting power in the sense people usually imply. Running more nodes doesn’t give proportional influence the way mining hashpower or stake would. Each node enforces rules locally, and invalid blocks are rejected regardless of how many other nodes accept them.

A large entity running many nodes could skew network statistics or give the appearance of consensus, but it wouldn’t be able to change consensus rules unless miners and economic actors followed along. That coordination problem is the real constraint, not raw node count.

I do think you’re right that social trust in maintainers is a weak point, especially over long time horizons. Bitcoin’s resilience relies less on node operators being vigilant and more on incentives making controversial changes economically unattractive. That’s not perfect, but it’s different from centralized control.

[N9_Ninja]

I’ve been thinking the same thing lately. Everyone calls you a 'fudder' if you point out that a few guys in the US control the repo, but v30 proved they can and will push changes without asking anyone. The 'nodes will rebel' thing sounds good on paper, but most people are too lazy to switch to alternative software. It’s becoming exactly what it was meant to replace

[DaveF]

I’ve been thinking the same thing lately. Everyone calls you a 'fudder' if you point out that a few guys in the US control the repo, but v30 proved they can and will push changes without asking anyone. The 'nodes will rebel' thing sounds good on paper, but most people are too lazy to switch to alternative software. It’s becoming exactly what it was meant to replace

They did discuss / ask in both on github and the google groups list.
Guess you were not looking or reading them when they did.

-Dave