Man that would shake things up. Curious to hear more from you on why the chain split is so bearish. Also need to listen to the episode first- will do on my flight tomorrow
I think a chain split is bearish even if almost all of the hash stays with the mainchain. Bitcoin is not hash power in isolation.
~20% of the nodes left while 99% of the hash remained. The main chain still has essentially all of its mining power, but it has objectively lost part of the physical system that previously represented one synchronized history.
Every node is a computer maintaining a redundant/identical physical state of bits. Behind each node is real people independently observing and enforcing the same state. Before the split, all memory and attention pointed toward one history. Post-fork, it doesn’t.
The hash didn’t meaningfully divide. The redundant memory of bits divided. The observers divided. Consensus divided. The bits of the mainchain objectively became more “centralized” than prior, since it was mostly individual plebs running nodes that left. There are less pleb nodes on the network than before; that is a directional move towards “centralization”, while not being centralization. All nodes are matter in the form of bits.
If we use gravity as a lens, the main chain has lost some of its informational “mass” in the form of nodes running identical bits; fewer computers contain and enforce identical copies of its present state. Its gravity has weakened even though its PoW remains dominant. The cohesive singular chain of bits remains untouched, just less copies.
Those who left didn’t necessarily leave Bitcoin back to fiat either. Their nodes, attention (conscious hash) and work moved into another Bitcoin-descended history. The physical system distributed itself between two chains. You can remain double spent between both chains. These plebs can hold the mainchain asset of bitcoin while directing both their physical hash and mental hash at a forked chain. They still benefit from our collective work, while directing theirs away towards another history. It’s a fundamental double spend since spend authority is in the key.
Fiat price does not have to distribute the same way either. There are an enormous number of fiat-denominated claims now sitting on top of Bitcoin. The debts are due via mainchain price but not the forkchain. Tons of debt, leverage, ETFs, derivatives, corporate balance sheets, loans and other promises ultimately denominated in fiat, a monetary system capable of creating claims without first conserving the work represented by what those claims purchase.
Bitcoin is the mirror opposite. A satoshi is a conserved unit of work inside a finite ledger of bits; a residue of historical work whose ownership can move but whose underlying unit cannot simply be printed into existence.
What happens when a debt system capable of multiplying claims is heavily exposed to an asset whose base units cannot multiply with those claims? How would Bitcoin adjudicate baseless (workless) claims upon conserved work?
Now come back to the chain split. Some of Bitcoin’s physical infrastructure, memory and human coordination has divided while enormous fiat claims remain priced against what markets still call “Bitcoin.” All of it feels unstable for Bitcoin backed by hodling fiat debt.
Bitcoin’s success feels increasingly uncertainly certain. The destination is becoming more probable while the path is becoming less predictable. This is bad for fiat debt.
IMO that means volatility can expand in both directions. Theres a lot of debt and ownership of sats ready to exchange hands in a debt collapse downward. Also I can see NGU vs fiat while purchasing power go down versus real energy. Both seem likely as the fiat system falls to chaos.
A serious chain split occurring while Bitcoin is deeply entangled with a leveraged debt system feels like the perfect setup for a repricing event that neither side fully understands, because we still don’t have a complete physical accounting of what Bitcoin actually is and why fiat cannot conserve it.
IMO a chain split is bearish in the immediate sense that synchronization has decreased while financial claims upon the system have not necessarily decreased with it. But If Bitcoin really does conserve something the debt system cannot, the eventual resolution should be violent in both directions.
Hardest days of hodling are likely ahead of us IMO. Just my opinion tho! I could be very wrong. I don’t think it will be as easy to survive as the consensus narrative projects.🤷♂️
~20% of the nodes left while 99% of the hash remained. The main chain still has essentially all of its mining power, but it has objectively lost part of the physical system that previously represented one synchronized history.
Every node is a computer maintaining a redundant/identical physical state of bits. Behind each node is real people independently observing and enforcing the same state. Before the split, all memory and attention pointed toward one history. Post-fork, it doesn’t.
The hash didn’t meaningfully divide. The redundant memory of bits divided. The observers divided. Consensus divided. The bits of the mainchain objectively became more “centralized” than prior, since it was mostly individual plebs running nodes that left. There are less pleb nodes on the network than before; that is a directional move towards “centralization”, while not being centralization. All nodes are matter in the form of bits.
If we use gravity as a lens, the main chain has lost some of its informational “mass” in the form of nodes running identical bits; fewer computers contain and enforce identical copies of its present state. Its gravity has weakened even though its PoW remains dominant. The cohesive singular chain of bits remains untouched, just less copies.
Those who left didn’t necessarily leave Bitcoin back to fiat either. Their nodes, attention (conscious hash) and work moved into another Bitcoin-descended history. The physical system distributed itself between two chains. You can remain double spent between both chains. These plebs can hold the mainchain asset of bitcoin while directing both their physical hash and mental hash at a forked chain. They still benefit from our collective work, while directing theirs away towards another history. It’s a fundamental double spend since spend authority is in the key.
Fiat price does not have to distribute the same way either. There are an enormous number of fiat-denominated claims now sitting on top of Bitcoin. The debts are due via mainchain price but not the forkchain. Tons of debt, leverage, ETFs, derivatives, corporate balance sheets, loans and other promises ultimately denominated in fiat, a monetary system capable of creating claims without first conserving the work represented by what those claims purchase.
Bitcoin is the mirror opposite. A satoshi is a conserved unit of work inside a finite ledger of bits; a residue of historical work whose ownership can move but whose underlying unit cannot simply be printed into existence.
What happens when a debt system capable of multiplying claims is heavily exposed to an asset whose base units cannot multiply with those claims? How would Bitcoin adjudicate baseless (workless) claims upon conserved work?
Now come back to the chain split. Some of Bitcoin’s physical infrastructure, memory and human coordination has divided while enormous fiat claims remain priced against what markets still call “Bitcoin.” All of it feels unstable for Bitcoin backed by hodling fiat debt.
Bitcoin’s success feels increasingly uncertainly certain. The destination is becoming more probable while the path is becoming less predictable. This is bad for fiat debt.
IMO that means volatility can expand in both directions. Theres a lot of debt and ownership of sats ready to exchange hands in a debt collapse downward. Also I can see NGU vs fiat while purchasing power go down versus real energy. Both seem likely as the fiat system falls to chaos.
A serious chain split occurring while Bitcoin is deeply entangled with a leveraged debt system feels like the perfect setup for a repricing event that neither side fully understands, because we still don’t have a complete physical accounting of what Bitcoin actually is and why fiat cannot conserve it.
IMO a chain split is bearish in the immediate sense that synchronization has decreased while financial claims upon the system have not necessarily decreased with it. But If Bitcoin really does conserve something the debt system cannot, the eventual resolution should be violent in both directions.
Hardest days of hodling are likely ahead of us IMO. Just my opinion tho! I could be very wrong. I don’t think it will be as easy to survive as the consensus narrative projects.🤷♂️
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