Maxi Vs. Maxi

₿ or Ξ? Even today, as a multi-chain Web3 ecosystem takes shape, Bitcoin and Ethereum diehards launch skepticism at each other.

If you spend your time on Twitter, the Bitcoin vs Ethereum maxi debate can become overwhelming.

“Bitcoin is the only money and Etherium is just a slow, premined, ponzi database built to distract us from solving everything.”

“Ethereum is built on ultrasound network effect and doesn’t fall prey to Bitcoin’s unsustainable economics.”

While these are an obvious compression of more nuanced points, it sometimes helps me to step back and form the soundest arguments for each extreme, so as to provide a frame for some of the debate that goes on in the character-limited public square.

Here are my current arguments for being a maxi.

The Bitcoin Maxi Argument

It’s interesting to me how many anti-Bitcoin-maxis ignore Bitcoin’s unique positioning as the globally-known fiat alternative currency.

I think this is an underrepresented axiom in most maxi logic, at least on Twitter, and helps build a pretty sound argument in favor of focusing a majority of energy on building adoption of the Bitcoin network.

The following is what I see as the most compelling maxi argument.

  1. We have a unique opportunity with cryptocurrency to fight for the separation of money and state (or at a minimum provide a powerful underground alternative as a check and balance)

  2. Bitcoin is best positioned in terms of global awareness by an order of magnitude

  3. Fragmented groups promoting their own alternative currencies and networks weaken the chances of success, and the window to provide the world with a new money may be limited

  4. Therefore, if we want monetary freedom, we should all rally behind BTC first, and when it has “succeeded”, the stakes become lower and we can all go experiment with alternative systems

If you approach Ethereum and other networks from this perspective, it is not hard to draw the following conclusion:

  • Many people in the Ethereum community don’t care much about the separation of money and state, or they would at least be empathetic to the above position

  • If they do strive for the separation of money and state, and prefer Bitcoin, then maximizing Ethereum’s brand awareness is essential, likely to the detriment of the Bitcoin brand

It’s not hard to see how this turns into name-calling from here.

The Ethereum Maxi Arguments

This is a small sample, but a few common arguments include:

  1. Bitcoin can’t do DeFi, and thus can’t support the broad needs of the on-chain future.
    This is tantamount in my opinion to something like “just having payments isn’t alluring enough to win the battle”. Not something I agree with but it’s not an unreasonable argument, and I think a strong case could be made supporting it.

  2. Bitcoin is unsustainable.
    Setting aside the ESG meaning, the argument that Bitcoin fees will not sustain the network is a valid fear, and also shared by Bitcoin maxis. In my opinion, this comes down to a bet on creativity. If you are optimistic about creativity driving an increase in future network fees, you are less worried. A good (though even more divisive 😅) example is Ordinals — creativity driving up fees.

    Another way to approach this argument is from the perspective of time. Ethereum maxis may push back and say that creativity is too limited by the base network functionality.

  3. Ossified tech becomes obsolete
    Is conservatism in network upgrades a good thing or bad? This is an article in itself so I’ll hold back on sharing my thoughts.

The Ethereum Extension and a Middle Ground

“But I like both Bitcoin and Ethereum.”

That’s fine, and where I stand, I think there are good logical extensions for this that can be built upon the same shared mission above.

A few unordered extension arguments:

  • Giving people a taste of free markets is more powerful than people think. Everyone exposed to the crypto world has had the Overton window dragged right through their plaster walls.

  • Not everyone in the world has the same risk profile, and giving people the option to diversify their investments and hedge risk is good. “Everyone should just buy Bitcoin” is bad financial advice.

  • Failing to pursue innovation where opportunity begs is not only pointless (people will always innovate where new technology is developing), but may also have unintended consequences. For example, if Ethereum devs figure out a private banking layer, it may end up being an important part of the fight down the road.

  • Experimenting with new financial products and governance structures will pave the way for the alternative systems of the future.

  • Bringing multiple fights is not a bad thing. Stablecoins put pressure on existing state-sponsored banking power structures, DeFi applies similar pressure by providing truly egalitarian opportunities (i.e. a loan on Aave does not discriminate).

I think that any of these are defensible and when combined provide a strong argument for continuing to focus our energy on both networks.