Everybody believes Bitcoin to be the really decentralized crypto in comparison with other tokens. But some say that the early crypto days could be totally another story.
Some crypto bros believe that Bitcoin is the only real cryptocurrency that fits the main community requirements.
These guys are called Bitcoin maximalists and partially they are right. Even in the biggest market drawdown like now, BTC appears to be the most stable coin.
It’s also kinda impossible for whoever to gain the majority of control inside the Bitcoin decentralized network.
Despite its low transaction speed, Bitcoin remains a truly anonymous proof-of-work network that gave the basis for all other cryptos.
But some experts say BTC wasn’t actually as decentralized and anonymous as we used to treat it. Some of these arguments are pretty fair.
Was Bitcoin decentralized?
According to a new study of several US Universities, just 64 Bitcoin owners were responsible for the vast majority of mining in the cryptocurrency’s early days.
One of the study authors is Microsoft researcher Jaron Lanier, who wrote an op-ed in Coindesk in support of its findings.
“It was not technical decentralization that sustained Bitcoin, but rather the decision of a small number of people, who seem to have known each other (through cryptography conferences and online forums) and their roles, not to attack the system,” Lanier wrote.
His paper combines a ‘variety of clever address-linking techniques similar to those offered commercially by firms like Chainalysis and Crystal Blockchain’ to find the 64 agents who mined a majority of BTC during the 2009-2011 period.
The main conclusion is that the attack of 51% could typically have been conducted by small groups of individuals (around five persons), including a single individual during this period.
Those verified 64 agents mined altogether 2 676 800 BTC which is equal to some $84 billion in present money.
“We all kind of knew that mining was fairly centralized. There aren’t that many miners. This is true even today, of course, and it was even more true at the beginning,” said another study author Sarah Meiklejohn, a University College London cryptography expert.
What about BTC anonymity?
Well, it’s hard to stay fully anonymous if it’s only 64 of yours out there. Especially inside the quasi-decentralized network.
So crypto scientists succeeded to identify the web of addresses and transactions associated with specific individuals who actually formed the Bitcoin network between 2009 and 2011.
The paper doesn’t leak those people’s names despite these two – Ross Ulbricht and Michael Mancil Brown. Those Bitcoin pioneers were publicly outed and convicted of several cyber-crimes, including running the darknet market.
Both Ulbricht and Brown were arrested, found guilty, and put in jail. But Brown spent only a few years in prison. And Ulbricht got two life sentences because of his notorious Silk Road darknet marketplace.
It seems highly likely that intelligence agencies have previously exploited security and privacy deficiencies to track the activities of crypto users, Jaron Lanier says.
“Revealing activities that many users believed to be protected by pseudonymity to sophisticated state security agencies while hiding transactions from communities of peers such as other developers, friends, or community credit unions that would have been better placed to monitor them in context,” former Microsoft researcher wrote.
According to him, the US National Security Agency, China’s Ministry of State Security, and Israel’s Unit 8200 have long had access to this information and chosen not to reveal their capability to preserve the mystique of pseudonymity.
But a way more impressive fact is that pioneer Bitcoin miners choose to save the network, not to abuse their power.
