Twitter Inc. had many critics when it unveiled a new form of verification in January for nonfungible token-based profile pictures. One user who disliked those hexagon images made a browser plug-in to automatically block users with them. Another had a similar idea, tweeting, “I’m going to block every single NFT profile picture I see.”
Are these two anti-cryptocurrency people?
The first, the one who made the browser plug-in, an American software developer by the name of Andi McClure, is indeed anti-crypto. But the second isn’t.
The second user is Francis Pouliot, who heads the Montreal-founded brokerage Bull Bitcoin. It’s just that he doesn’t like other cryptocurrencies or applications of bitcoin’s blockchain technology, such as NFTs.
The wider world often uses terms such as “bitcoin” and “crypto” interchangeably. But Mr. Pouliot finding common cause with Ms. McClure shows just how far apart different camps in crypto can be.
Investors should take note of that. It might be time to appreciate some of Mr. Pouliot’s nuance and view bitcoin as distinct and separate from the rest of cryptocurrency.
Last week, Mr. Pouliot spoke at Bitcoin 2022 in Miami, a major conference for the industry. To the outside world, it might be a “crypto” event, but these guys hate that word. At the panel Mr. Pouliot was on, one speaker, when asked what the biggest threat to bitcoin is, replied “cryptocurrency.”
Last year, at Bitcoin 2021, boxer Floyd Mayweather was booed when he showed up promoting a crypto project that was not bitcoin. The bitcoiner Jack Dorsey, who left Twitter before its NFT integration, tweeted this week he had “zero interest in cryptocurrencies.”
There didn’t used to be such a stark division. The project Mr. Mayweather was promoting was based on the blockchain network Ethereum, which more or less represents the non-bitcoin crypto world. That network was founded by Toronto’s Vitalik Buterin, who also founded the industry publication Bitcoin Magazine, which organizes the Bitcoin conferences.
But Mr. Buterin’s founding of the magazine had been back in 2011, only two years after bitcoin was introduced to the world, rising from a primordial pool of cypherpunk ideas and libertarian economic discourse. In those early days, “bitcoin” was indeed synonymous with “cryptocurrency,” for there wasn’t much else aside from it.
And bitcoin does only one thing. It enables direct transfers of value without a central organization overseeing it, and because of that it is resistant to control by any one party.
Soon, though, the tent grew. More people took notice, and they sought to use bitcoin’s blockchain technology for other purposes. This precipitated the birth of Mr. Buterin’s Ethereum network, introduced to the world in 2014.
That, in turn, was the beginning of the crypto world we know today, in which anyone, including central banks, can create their own coin, NFT or blockchain application. Amid all those developments, Mr. Buterin sold Bitcoin Magazine, which turned bitcoin-only in 2018 – in a way symbolizing the split between the one-track bitcoin and the rest of crypto mushrooming in all directions.
The more stringent of the bitcoin-only folks are often called “bitcoin maximalists.” They want only the one thing bitcoin does. They see the pictures of apes selling for hundreds of thousands, those coins based on dogs, and the rampant thievery and fraud – and they share the disdain of mainstream crypto critics. It’s just like how it is with Mr. Pouliot and Ms. McClure and NFTs.
The maximalists are not wrong, in a way. Thirteen years is a long time for crypto. With every boom-bust cycle, hot new use cases for blockchain and bald-faced scams have come and gone. So have thousands of shiny new coins. Bitcoin is still standing.
But the point isn’t so much whether the maximalists are right or wrong. It’s also how Mr. Buterin’s Ethereum, with its ether coin, is one of the few non-bitcoin crypto projects to have lasted as long as it did. Its longevity comes not from trying to do what bitcoin does – which it can’t – but by going around that and doing what bitcoin does not do, such as being the platform for NFTs and higher-ambition blockchain computing. Bitcoin and the rest of crypto serve different purposes.
One caveat is that the prices of most cryptocurrencies still have some correlation with bitcoin. But so do all related companies or commodities: gold and silver, Apple Inc. and Microsoft Corp., oil and gas.
Yet they are so different that, in 2009, Ovintiv Inc., then known as Encana and based in Calgary, spun off Cenovus Inc. to make one gas company and one oil company, so that investors could focus on one or the other.
It helps to look at bitcoin and the rest of crypto through that lens.
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