Why Is There Maximalism In Crypto?
When new people enter crypto, one of the very first cultural bugs (or features depending who you ask) they notice is maximalism: “Why do the Bitcoin people ban us from their Clubhouse rooms when we start discussing altcoins? Why do the Ethereum people call newer blockchains ghost chains? Why isn’t there more collaboration between the various core development teams of different blockchains?”
Many have asked me these questions on platforms like Clubhouse. Heck, even Urban Dictionary defines Bitcoin Maximalist.
In my opinion, maximalism in crypto means a fervent, singular, and blinding belief in one blockchain. Like nationalism, racism, and other isms, crypto maximalism is largely driven by an emotional superiority complex rooted in fear. There is a distinct fear that other blockchains’ success might yield a depreciation in value of their asset.
This cultural phenomenon of maximalism is by no means unique to crypto. Historically, dogmatic fervor has surrounded other technologies that have come to market at the same time.
A brief history of maximalism in technology
Maximalism has existed in technology for hundreds of years. Inevitably, this maximalism has created conflicts between supporters of different technologies that seek to solve similar problems in different ways.
In particular, the War of the Currents in the 1880s, spearheaded by Edison and Tesla, was a particularly nasty conflict. Both DC and AC electricity was meant to introduce power into the homes of Americans for the very first time. Yet the supporters of the respective technologies were complete maximalists. In fact, Edison secretly ensured that the electric chair used AC power. Edison was then able to show pictures to the public of what horrors can be caused by AC!
While not quite as cut-throat, in the modern day people can still very much remember the war Microsoft and Apple waged for the consumer’s heart over the past two decades in the realm of computing. At least these marketing campaigns relied on humor more so than shock (no pun intended) to assuage the consumer of the failings of the alternative technology.
As we can see from these examples, maximalism is by no means a unique phenomenon to the crypto ecosystem.
Bitcoin in the glory days
In the early days, as in 2013, everything in crypto was rainbows and unicorns. At that time, the crypto community was incredibly small, and many early joiners to the movement were ideologically similar. Much of the early Bitcoiners believed in values such as censorship resistance, privacy, and independence. In fact, The Liberty Forum in New Hampshire, a conference that is for people who want to be free from government influence, hosted Bitcoiners every year instead of corporate conferences like Consensus.
Originally, loving Bitcoin was like saying that you love freedom. Just because you loved freedom didn’t mean you necessarily had ill feelings towards other blockchains. Yet this sentiment began to change in 2014 as more people in the crypto community started learning about Vitalik’s ideas.
How maximalism gained steam in crypto
When Vitalik Buterin proposed using smart contracts on a blockchain, he believed he would find support from the Bitcoin community. Vitalik corresponded closely “with a cluster of entrepreneurs and developers… [that] were trying to push Bitcoin’s limits and whether it could be used for more than digital currency… those efforts were known as Bitcoin 2.0.” (Infinite Machine, 40). In fact, Vitalik Buterin himself was an ardent Bitcoiner, as evidenced by his co-founding of Bitcoin Magazine. He prolifically wrote about what Bitcoin could accomplish.
When Vitalik proposed the idea for Ethereum on the BitcoinTalk Forum, many members at first wished him best of luck with the project. But even back in January 2014, many Bitcoiners harshly disapproved of the Ethereum project for largely ideological reasons. Many community members accused Ethereum of being a cash grab, with the technology really adding no value to the ecosystem.
Even before Ethereum launched, while the idea for a new network based on smart contracts was gaining steam, Vitalik felt compelled to write a post about Bitcoin maximalism. In this post, Vitalik questions the value of having such a dogmatic perspective, and if Bitcoin maximalism was healthy for the crypto community at large. Many in the Ethereum community now call Bitcoiners maximalists as a slur now to combat the perceived closed-mindedness.
Of course, Vitalik’s perspective was not heeded by the Bitcoin community, and as Ethereum grew in adoption, the criticisms form the Bitcoin community grew along with it:
Of course, not all leading Bitcoin voices believe maximalism is the best path to evangelize users and developers towards their cause. In fact, leading Bitcoin educator Andreas Antonopoulos himself believes Bitcoin maximalism is unhealthy for the ecosystem.
How financial incentives can skew one’s perspective
I have spoken with many Bitcoin maximalists about this perspective, and the rationale I am given for this behavior often comes down to the following logic: we need to protect new users from being exposed to scams. Many Bitcoin maximalists point to the plethora of scams that exist in the crypto market. From corrupt ICOs, to rug pulls in DeFi, to vaporware, there are plenty of areas Bitcoin maximalists can point to that paint less than a desirable picture to the ecosystem outside of Bitcoin.
And you know what? All of these things are true! There are many scammers in crypto, and having a technology that resists censorship does attract some nefarious actors. That being said, it is no different than saying Bitcoin is bad because criminals use it to sell drugs and use the network for terrorist financing.
At the end of the day, maximalism largely comes down to financial interests. Why did Edison effectively orchestrate the death of a criminal through the electric chair that was powered by AC current? Because Westinghouse, the company behind AC, was Edison’s biggest competitor! There was no greater threat from Edison’s perspective to his bottom line than Westinghouse.
The financial incentives of the supporters of certain technologies are the greatest reason why I believe maximalism arises.
It doesn’t have to be this way
Yet the maximalism that exists within crypto, to me is not only toxic, but completely illogical. Unlike Microsoft and Apple, Ethereum and Bitcoin do not even directly compete against one another. Bitcoin has clearly positioned itself as the network that supports the future preeminent store of value, while Ethereum has become a platform for decentralized applications.
One time, I tweeted this exact sentiment to a prominent Bitcoin influencer. His response to me was that Ethereum and Bitcoin directly compete with one another to be on the balance sheet. Effectively, this argument is saying that because ether and bitcoin are two different assets, they must be in competition.
This logic does not hold in my opinion. I do not view Apple, a leading consumer products company, as directly competing with Barrick, a leading gold mining company. Just because both these companies have publicly traded stocks, doesn’t mean they are direct competitors. Barrick and Apple have completely different business models, suppliers, and consumers.
If we view Barrick and Apple differently, why don’t we treat Ethereum and Bitcoin the same way?