Former Bitcoin Core Developer Abandons Cryptocurrency Ecosystem

News and Analysis

Former Bitcoin Core developer and one of bitcoin’s earliest adopters Mike Hearn stated he abandoned digital currency ecosystem as it suffers from a massive crisis.

According to Hearn’s extended entry on Medium, the crisis also involves bitcoin’s blockchain. For that reason Hearn expects the cryptocurrency’s exchange rate to drop.

“From the start, I’ve always said the same thing: Bitcoin is an experiment and like all experiments, it can fail. So don’t invest what you can’t afford to lose,” he wrote. “But despite knowing that Bitcoin could fail all along, the now inescapable conclusion that it has failed still saddens me greatly.”

“The fundamentals are broken and whatever happens to the price in the short term, the long term trend should probably be downwards. I will no longer be taking part in Bitcoin development and have sold all my coins,” he added.

Last year, Hearn joined R3, a consortium with goals that some members of bitcoin community deem dubious.

Hearn’s statement echoes the prolonged dispute within the community around several issues including block size limit, Bitcoin Foundation crisis, and evident instances of censorship on Reddit and other forums. Hearn also complains that the blockchain is de-facto controlled by Chinese miners, with just two of them being in control of more than 50% of the network’s hash power.

Concluding his statement, Hearn, however, declares that “all is not yet lost”. In particular, he mentions two forks, Bitcoin Classic and Bitcoin Unlimited, which, to his reckoning, are capable of solving blockchain’s problems.

Hearn’s statement instantly caused bitcoin’s exchange rate to drop. As this material was being written, bitcoin price reached $405 according to CoinDesk, while it comprised just $396.87 as per Coinbase.

At the moment of publishing, the exchange rate grew to $410 as per CoinDesk, or $409.80 as per Coinbase.

However, the market’s reaction to the developer’s statements might be impulsive, and therefore could have nothing to do with actual supply and demand. Further development of events will probably become clearer in the days to come.

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