Can Bitcoin Survive Without a Leader?

When I talk to people about Bitcoin, one of the only details they seem to know about it (aside from it being “magic internet money”) is that ‘nobody knows who invented it’. A friend of mine brought it up yesterday as a reason why he doesn’t trust Bitcoin. In his mind, there must be somebody at the reins and “backing it”. He’d also read that Bitcoin filed for bankruptcy (🤦) but that’s a subject for another article. The things Bitcoiners must deal with thanks to media ignorance… *sigh*

Bitcoin being a leaderless technology is a point worth consideration, however. Afterall, what successful movement of the past didn’t have a leader or group of leaders? Leaders are important. They provide vision and direction as well as authority and confidence. Humans are tribal, so these qualities matter. People want someone to look to for leadership, and someone to blame for failures. In hard times they want a strong figure to inspire them with confidence, and in good times to assure them they will continue. The great civilizations of the world were built because humans trusted in their leaders, for good or for ill.

Every Tesla has its Elon Musk, every Microsoft its Bill Gates, every Apple its Steve Jobs. Bitcoin has its Satoshi Nakamoto, but nobody knows who he is (or “she” or “they”), so they look to other lesser leaders in the space. Bitcoin has thought leaders, but its community is fractured in a sense because those leaders don’t always agree with each other and there’s no final decision-maker to judge one right and the other wrong.

An example of this is playing out right now between Jason Lowery, member of the U.S. Space Force and National Defense Fellow at M.I.T, who is arguing that Bitcoin is a non-lethal weapon protected by the 2nd Amendment that is critical for national security, and Marty Bent, founder of the Bitcoin media company TFTC.io and Venture Partner at Bitcoin-only venture fund Ten31, who vehemently disagrees with that characterization. Infighting and arguments have erupted in the community between both camps, though a debate has been tentatively planned that will hopefully bring some clarity to the matter. The point is Satoshi can’t step in and settle the issue in the way Elon Musk could with a disagreement at Tesla.

This kind of infighting creates some chaos that could hurt adoption. If you walked into a bank where the tellers were arguing over the right way to distribute funds to customers, you might immediately turn around and find another bank. The lack of civility in the disagreements surrounding Bitcoin can be off-putting to newcomers, and Bitcoin needs as many new adopters as it can get.

I would argue, however, that Bitcoin has to be leaderless in order for it to succeed. There are five reasons for this.

1. Projection

The flaws, traits and politics of human leaders are usually projected onto the projects they run. Tesla is an example of this. Once the liberal darling for its image as climate saving technology, it has lost some of its appeal to the Left based on statements and actions taken by Elon Musk that had no material impact on Tesla (for example, his statements about Covid). It remains to be seen whether that loss of approval will impact sales long term, but the fact that it could makes the point.

Bitcoin being leaderless is beneficial for adoption since it’s apolitical. People can only judge Bitcoin on its own merits and not on any personal traits or political positions of its unknown creator. Nobody will refuse to buy Bitcoin because its leader is too “Left” or “Right” leaning.

2. Head of the Snake

Leaders can be attacked. Their personal safety, family safety, and financial security can all be threatened. Since they wield power over the movements they lead, they can be coerced into directing the movement in ways that aren’t good for its supporters. Or, in a more extreme case, if the leader is assassinated or otherwise silenced, it can throw the movement into disarray.

Bitcoin was designed to replace the corrupt and broken fiat system of the world. There are countless powerful people who benefit from this corruption and do not want things to change. If the opposition to Bitcoin knew who Satoshi was and if he exerted great control over Bitcoin’s direction and community (i.e. if he was the Vitalik Buterin of Bitcoin), that would be an easily exploited attack vector once Bitcoin grew large enough to be a real threat to the current system. For his own safety and the security of Bitcoin, it’s good that Satoshi remained anonymous and then disappeared.

3. Assumed Authority

Leaders aren’t always right, and sometimes their mistakes can cause real damage. Evidence of this can be seen in Ethereum’s switch to Proof-of-Stake from Proof-of-Work, which fundamentally altered Ethereum in a way that caused SEC Chair Gary Gensler to change his position on whether Ethereum is an unregistered security. Proof of Stake also weakens Ethereum by removing its connection to the physical world through the power required by mining.

How much damage these changes will cause to the Ethereum landscape going forward remains to be seen, but the point is the decision for this change was pushed by Ethereum’s co-founder and de facto leader, Vitalik Buterin. Of course, the Ethereum community had to support Buterin’s desire for the change, but it cannot be underestimated how much his opinion has held sway over Ethereum’s direction, even if that influence is diminishing.

That brings us back to the current debate between Jason Lowery and Marty Bent over Bitcoin’s classification as a non-lethal weapon and its role in national security. Not having a leader making unilateral decisions or holding majority influence over Bitcoin’s direction requires debate between the people who wish to impact it. Not that there’s zero cult of personality at play in the Bitcoin community. Bitcoiners are still tribal humans and look to influential people in the community for direction, but there’s no perceived single leader whose opinion is considered “best” by default. That makes it harder to push change without informed consensus.  Like Bitcoin itself, Bitcoin’s community leadership is decentralized.

4. Scapegoats

When projects fail, leaders get blamed. Politics are a perfect example of this. Despite the President of the United States wielding limited power over the laws and actions of the government as a whole, he is often blamed for every negative consequence in the economy or society while holding office. It’s an easy scapegoat.

With Bitcoin, there is no scapegoat. If it fails, there’s nobody to blame. This encourages personal responsibility and critical thinking. If you’re going to swap fiat for Bitcoin, you better understand what you’re getting yourself into, how it works and what its principal attributes are. You can’t make yourself feel better by pointing at Satoshi and blaming him for all your woes. You also can’t expect Satoshi to do all the work to make Bitcoin successful, so you need to do your part if you want it to succeed for your own benefit.

The advantage of this is that people who buy into Bitcoin often fall down the rabbit hole of why it was created in the first place. Understanding the truth about sound money versus fiat, the damage fiat has caused, and the debt spiral the world has entered because of it only strengthens Bitcoin hodlers’ conviction. This knowledge often gets shared to friends and family, further increasing adoption.

5. Personal Ownership

If you don’t like a CEO’s politics or preferences, you might hesitate to buy the products created by the company because you don’t want to enrich its leader who will potentially funnel money into agendas you disagree with. You also may balk at the idea of making that person wealthy just on principle.

With Bitcoin, the only person you’re enriching is yourself. There is no company, no foundation, no leader. Your Bitcoin is your own private treasure, and you’re trusting in that treasure’s inherent value to increase adoption and your own personal wealth over time. No single person’s foul-ups can derail that for you. Bitcoin succeeds or fails on its own merits.

Leaderless Network Effects

The five points outlined above all help further Bitcoin adoption. With no leader to hate or whose politics you disagree with, there’s no ideological friction to buying in. With no attack vector against the leader, there’s no single point of failure that’s easy for the current corrupt system to exploit. With no person holding majority influence, changes must be made through debate and consensus. No leader to scapegoat engenders personal responsibility that leads to knowledgeable hodlers that view their stack as their own personal treasure and not as the means to enrich someone they may not like or trust.

Unlike other crypto projects, Bitcoin seeks to dismantle the corrupt fiat system, not to build on top of it or profit from it. It exists because centralized power has proven detrimental to humanity, so it’s only fitting that the Bitcoin community also be decentralized and leaderless. Power corrupts, as the saying goes, and leaders of opposition movements usually become the thing they fought against once they succeed. Bitcoin cannot have this fate, for it has no leader. Yet another reason to be Bitcoin-only.