Bitcoin Core Developer Explains Bitcoin’s Value
Jimmy Song has 20 years experience as a software developer. So it’s easy to imagine that he took an interest in Bitcoin from the technology angle. However, Jimmy first got interested in Bitcoin as a store of value and sound money, and only later started to contribute to the Bitcoin core development team and to train new developers for the technology.
The Epoch Times spoke to Jimmy Song about why Bitcoin is sound money, where its value comes from, and how it compares to the other cryptocurrencies.
Epoch Times: How did you first get interested in Bitcoin?
Jimmy Song: When I first read about it, Bitcoin had broken $1, and I wondered: what is Bitcoin? I’ve never heard of this thing, and why is it important that it broke a dollar? How can a Bitcoin have a dollar? I looked into it. I read about it. I read as much as I could and I discovered that it had this twenty-one million Bitcoin limit.
This is something where you can’t make more of it, and that was the big draw for me. I mean, there’s a medium of exchange component that was pretty interesting too. You could send money to Africa in ten minutes without anything complicated like the Western Union, but having the store of value property was far more interesting to me.
You’re not going to be able to inflate it in any way. Bitcoin is sound money because there is a fixed supply limit and demand is always increasing. That creates a really good investment, at least from my perspective, and so I bought some at around $30. I do wish I bought a lot more but everybody in Bitcoin does.
Epoch Times: Later you started programming for several Bitcoin projects, and now you contribute to the core development team. Please tell us why you believe in Bitcoin as a network.
Mr. Song: The big thing that appeals to me now is its anti-fragility. Nassim Taleb talks about anti-fragility in his book ‘Antifragile,’ but basically, Bitcoin gains from disorder and that’s what I’ve noticed. Why does it keep going up when there’s crazy things happening to it and especially with regard to this recent hard for with Bitcoin Cash?
I thought about it and upon reflection, I’ve come to the conclusion that the reason is: Bitcoin is being immunized against attack. It’s growing from disorder because there are actual people who are going out there and changing parts of the ecosystem. You can be a core developer, you could be a wallet developer, or you could be an exchange developer, you can be a merchant developer or a processor developer. Whatever it is, they’re all sort of working to make their part of the ecosystem better so that they can withstand these attacks and as a result, Bitcoin becomes a better store of value. Right? The more immunity it has to attack, the more secure it is, the better a store of value it becomes.
Things like the Bitcoin software just aren’t smart enough to handle stuff like that. It has to be people that actually fix it and that’s what I think gives Bitcoin a lot of security value — because you have all these people watching it and not just like computer software that’s running on its own. It’s developers, it’s the people that are actually checking the code or watching the network figuring out low probability scenarios and how to immunize against those. That’s what gives it value. That’s what gives us security. That’s what makes it a great store of value.
Epoch Times: According to you, the quality of the development team directly influences the value of the cryptocurrency.
Mr. Song: If you look at the different market capitalizations of cryptocurrencies, the quality of the developers and the price tends to be somewhat correlated. So Bitcoin is obviously the biggest and has the most developers, it’s number one and the second is Ethereum and number three right now is Bitcoin Cash.
That makes sense because it’s the developers that give any coin or ecosystem the antifragile quality. Right? They’re the ones that can react to attacks on the network. They’re the ones that can fix various things whereas, like coins that have gone down in value, their developers have abandoned it or they’ve since moved on to other things or aren’t very good. I don’t know if a correlation is necessarily causation but the fact that developers give the network security and the security gives it a store of value and that in turn gives it a higher price, that makes sense to me.
Epoch Times: Another important point for cryptocurrencies is the decentralization. They need to be decentralized, otherwise one could just use a centrally managed currency like the U.S. dollar. Would you say Bitcoin is the most decentralized of them all?
Mr. Song: I would say so. There’s a lot of different implementations of Bitcoin. There’s a lot of different nodes and software and wallets. There are all kinds of wallets on the Bitcoin network. You have exchanges, you have this whole infrastructure that’s very motivated to make it good and it’s definitely more decentralized than say Ethereum or, Bitcoin Cash or any of these other ones. A lot of them have foundations or a group of developers who run the show.
If you look at something like the DAO hack of the Ethereum network. They said, this is what we’re going to do and it was decreed by Vitalik Buterin and they had a hard fork, completely reversing the hack. That may be good for whatever they’re trying to do but that’s not decentralized.
Ethereum is not sound money for a lot of reasons, but that that’s one of the reasons that it would disqualify, it is that there’s a central person that you can go to and appeal to and say, “let’s make another a hundred million Ethereum right now.” Ripple suffers from the same problem. They have this huge storage of ripples that they can release to the market at any point.
If you have an authoritarian governance model, I don’t really see that as very secure sound, whereas with Bitcoin, it’s very decentralized. I mean, nobody would go along with raising of the twenty-one million limit and things of that nature. In that way, I see Bitcoin as more secure than all these other coins because there is no single point of failure. I think one of the best things that the founder, Satoshi Nakamoti, did was disappear because that took away sort of that authoritarian voice that he would have naturally had. And people still appeal to Satoshi all the time but, in a sense, his disappearance kind of led to the decentralization that we see today.
Epoch Times: Because you believe developers are so important for Bitcoin, you have recently started a training program with which you hope to alleviate some of the shortages.
Mr. Song: Developers are at the heart of what Bitcoin is. I recognize that almost every company is trying to hire ten big block-chain engineers or Bitcoin engineers and there’s a very, very small supply. The software developers that got into Bitcoin early enough are really rich so they don’t really need to work, or they started their own companies or they’re part of another company and they’re very happy already because their companies are very motivated to keep them happy.
I decided the way to fill that gap is just to train more people, and I do have some background in doing that. So I started the company Programming Blockchain, and I started recently with the first two-day seminar where I teach everything. I feel this is a win for everybody. It’s a win for the students because they can have a much more lucrative career in blockchain engineering or Bitcoin engineering.
It’s obviously good for the industry because they’re getting more Bitcoin developers, and this is big needs area for pretty much every company. It’s obviously good for me because this is something that I like to do. I feel like it’s contributing and also I’m making money. So win, win, win, and that’s the direction I want to go.
The interview has been edited for clarity and brevity.