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Bitcoin SV melts under the spotlight. Delistings, lawsuits and fraud accusations

Andrew Munro 16 April 2019 NEWS

Picture not described: shutterstock-crypto-digital-dna-738x410.jpg Image: Getty

BSV is in the hot seat as the crypto community grapples with it.

Craig Wright is best known in the cryptocurrency world for repeatedly claiming to be Bitcoin creator Satoshi Nakamoto without providing any concrete evidence to support the extraordinary claim.

That hasn't stopped him from picking up a range of followers, and Wright's Bitcoin SV (Satoshi's Vision) cryptocurrency has retained a position in the marketplace since its creation.

Arguments between Wright and his detractors have been a long-standing sideshow in the cryptocurrency world, but now people think Wright might have taken things a little too far, and a concerted movement to expel Bitcoin SV (BSV) from the industry has taken root.



There's always someone who takes a joke too far

The recent backlash against Craig Wright and Bitcoin SV began in earnest when Wright showed renewed interest in suing people who said he wasn't Satoshi Nakamoto – and because there are so many of them, a lot of people took issue with this.

"Craig Wright is a fraud," said the Binance CEO Changpeng Zhao. Shortly afterwards, Binance announced that it was pulling the plug on BSV and kicking the controversial coin to the curb.

Other exchanges were quick to follow suit. ShapeShift CEO Erik Voorhees announced that BSV would be getting delisted there too, and Kraken posted a Twitter poll asking whether it should do the same. Respondents overwhelmingly said yes. Blockchain.com has also picked a side, and announced that it will be ending support for BSV.

"Craig Wright is a liar and a fraud. So sue me... again," chimed in Roger Ver, a well-known Bitcoin Cash personality.

"It's lie after lie after lie," agreed Wright's erstwhile Bitcoin business partner Phil "Scronty" Wilson, speaking to Finder. "He's suing people now who say he's not Satoshi... it doesn't make sense. Prove you are or shut up."



Opinion: What to keep an eye on

There are a couple of moving parts worth exploring here.

Will a court decide on the origins of Bitcoin and who Satoshi Nakamoto is?

It's been suggested that for Wright's lawsuits to work, he will need to prove that he is Satoshi Nakamoto. To date, Wright has not provided any ironclad evidence of this claim.

The most solid evidence of the claim to date is compelling but not bulletproof and is counterbalanced by some evidence to the contrary.

So if all this does actually go to a judge, legal amateurs suggest that Wright will need to bring something new to the table if he wants to win. And either way, the indirect question before the court will be "who is Satoshi Nakamoto?"

It would be a case worth watching one way or another.

How free is the free market?

Despite popular support for delisting BSV from exchanges, a lot of people are also concerned about the precedent it sets and the implications of exchanges delisting coins on moral grounds, and a lot of debate has formed around these questions.

Picture not described: erik-voorhees-on-free-markets-snip.jpg Image: Getty

Depending on where you're standing, this movement could either look like the free market doing free market stuff or like a concerted censorship effort from a cabal of exchanges.

Of course, there's no reason it can't be both. Cartels and organised censorship efforts are both features of a free market and are more likely to crop up in markets that lack regulatory guardrails to help ensure freeness and openness.

Digital fire drills for decentralised governance

The coordinated response on show here is also a sterling example of how efficient and organised the cryptocurrency world can be in responding to and shaping the norms of its own market.

With a bit of imagination, it's a nice example of decentralised governance and a kind of fire drill where the market tests its ability to collectively decide to reject an unwanted participant. Think of it as a kind of cryptocurrency hive mind reaching consensus.

  1. The hive tolerates BSV despite very few people actually believing that Craig Wright really is Satoshi Nakamoto. There are differences of opinion, but the resulting arguments are more harmless entertainment than anything else.
  2. Wright threatens people with legal action for publicly denying that he's Satoshi Nakamoto. The hive now perceives the participant as an active threat to the community as a whole because the participant is trying to enforce an unwanted world view on the whole and is a hazard to many individual members of the community.
  3. The hive uses a range of tools (Twitter hashtags, etc) to gauge its collective opinion on whether it should keep tolerating BSV or whether it's time to exorcise it.

The decision achieves a snowball effect and the hive reaches consensus when influential participants take sides in a way that shows they're putting their money where their mouths are. For exchanges like Binance, this takes the form of a delisting. For John McAfee, it takes the form of a promise to sue Calvin Ayre, an ally of Wright, for $800 million. And for many others, it takes the form of simply putting their word behind one side or the other.

These kinds of meaningful gestures rather than talk alone help prevent astroturfing from spambots (or Sybil attacks, if you will) that could derail the discourse and lead the community to the wrong decision.

All in all, it's an excellent example of decentralised governance of a sort in action, coming at a time when the world needs to look closely at how and why digital communities need to start effectively policing themselves.

Disclosure: The author holds BTC at the time of writing.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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