Bitcoin: Imperfect by design

The views expressed in this article are those of the author and do not necessarily reflect the position of CoinGeek.

Perfection is the enemy of good. Voltaire said it, engineers live by it, and Bitcoin proved it over a decade of forks, civil wars, and a thousand competing chains that each thought they had a better idea.

About two years ago, I wrote a piece for CoinGeek called “The beautiful imperfections of Bitcoin,” where I laid out the philosophical case that Bitcoin’s apparent design flaws (race conditions for consensus, competitive mining instead of altruistic validation, lack of cryptographic finality, and the block reward schedule itself) were features. They were the mechanisms that forced human participation and created economic incentives strong enough to sustain a global network without a single CEO, board meeting, or product roadmap. That article was about the beauty of such imperfections. 

This one is about the consequences.

Because in the two years since, every chain that pursued “perfection” has paid the price for it, and every system that accepted its own imperfections and built anyway has gotten stronger than the critics predicted.

The cost of optimization

Bitcoin was always “good.” A well-engineered system optimizes for the most stable, scalable, general-purpose rules, because optimizing for specific uses always comes at a cost of other variables. That’s an engineering principle as old as bridge-building, and the entire history of the digital asset space is a lesson in what happens when you forget it.

Every chain that exists today, from BTC to BCH to BSV to the thousands of alts, exists because someone thought they could perfect something. BTC is optimized for lots of little nodes. BCH is optimized for community governance. Ethereum is optimized for programmability. Solana is optimized for speed. Each of them made trade-offs, and each of them broke something in the process that the original Bitcoin design had actually gotten right.

BTC’s trade-offs are the ones I know best, and they’re the most instructive. The small block camp “won” the block size wars by arguing that everyone needed to run a node, that decentralization meant maximizing the number of independent validators on consumer hardware. They got what they wanted. Tiny blocks. Tens of thousands of home nodes. And a system that has not disrupted a single person in finance, banking, or payments out of their job, which tells you everything about how well those trade-offs actually worked.

Satoshi Nakamoto solved the Byzantine Generals problem with Proof of Work (PoW), then reintroduced Byzantine soldiers (home node operators) who second-guess the proof of work anyway. The whole point of Nakamoto consensus was that you don’t need to trust anyone because the work speaks for itself, cryptographically. BTC’s “node culture” reintroduced trust requirements through the back door: trust the developers who issue the soft forks, and trust the Core repository maintainers who merge the code at conferences and mailing lists where “rough consensus” gets manufactured behind closed doors.

This created a de facto, developer-led oligarchy, which is actually controlled by Big Banks, Big Tech, and Big Gov. (I’ve said this once or twice. Maybe a thousand times. At this point it’s practically my ringtone.) Digital Currency Group takes investment from New York Life, CME Group (NASDAQ: CME), and Mastercard (NASDAQ: MA), while Reid Hoffman and Austin Hill raise money from Jeffrey Epstein and the rest of the PayPal Mafia (NASDAQ: PYPL), and then fund the developers who change Bitcoin’s protocol. Legacy payment companies are funding the development of the system designed to replace them. 

If that doesn’t set off alarm bells, I genuinely don’t know what would.

The deeper problem is that the pursuit of perfection made the capture possible in the first place. When you decide the protocol needs to change, you create a class of people who get to decide how it changes. You create politics. And once you have politics, you have capture, because the imperfect protocol that nobody can change is more resistant to corruption than the “improved” protocol that a committee controls.

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Commercial inertia is the real defense

Now for the uncomfortable part.

I’ve spent years arguing about governance structures, protocol stability, legal frameworks, and technical architecture. All of that matters. But the thing that keeps me up at night as a principled bitcoiner is this: more than boards, organizations, contracts, or law, the most important thing for victory is commercial inertia, and the sooner the BSV ecosystem internalizes that, the sooner things change.

Having lots of customers, lots of liquidity, and lots of turnover is actually the best way to be resilient against all the other risks that exist in competitive, distributed systems. The best way to mitigate the influence of everyone and anyone else is to be able to say: “I have a ton of customers, and hurting me actually hurts them, so you really shouldn’t mess with me.”

As much as I hate admitting it, the big lesson we should all learn from Tether is exactly this. Tether has every problem in the book: opacity, regulatory risk, questionable reserves, and a management team that operates from jurisdictions specifically chosen to avoid oversight. And it doesn’t really matter. Commercial inertia has made Tether nearly untouchable. Billions of dollars flow through it daily. Exchanges and traders depend on it so completely that disrupting Tether would cause more damage to the broader market than anything Tether itself has done, and everyone in regulation knows it.

Then, there’s something like Solana; everyone’s favorite “scalable” blockchain… Solana is a giant, centralized scam chain. Premined tokens, huge allocations to insiders, deep connections to FTX, and a foundation that unilaterally intervenes whenever the network chokes. If you wrote a checklist of everything a blockchain should NOT be, Solana would tick every box. And it doesn’t really matter, because they marketed the living daylights out of their inferior but “good enough” offerings, built commercial relationships, and created enough inertia that criticizing them feels academic.

The response to every qualm, every governance dispute, every protocol argument, every X/Twitter fight about who’s doing it wrong, is actually business development and success. The qualms matter. But the system with the most customers can absorb the cost of its imperfections, while the system chasing perfection with twelve users cannot absorb anything at all, no matter how elegant the architecture looks on a whiteboard.

There’s an old saying I come back to a lot: the best vengeance against my enemies is the laughter of my children. Stop worrying about what the other chains are doing wrong. Build something people use. Get customers. Create liquidity. Generate turnover. That’s the armor. Everything else is commentary.

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BSV governance: better than you think

In BSV, people love to complain that governance isn’t perfect. “BSV Association has too much power…” “The NAR is too top-down…” “There’s no democratic process…” 

Fair enough. 

I’ll listen to the criticism, and then I’ll make the case that BSV has the best governance model of any blockchain in existence, because the evidence supports it.

There’s a fundamental confusion that keeps surfacing in these debates, and Connor Murray (Director of Stewardship at BSV Association) put his finger on it recently.

People confuse decentralized governance with distributed systems. Bitcoin was never meant to be governed by a committee. It’s a distributed network with defined rules, and the NAR codifies those rules so that everyone, including the governing body itself, plays by the same standard.

The NAR wasn’t thrown together by amateurs. It was modeled on the ISDA Master Agreement, the standard contract governing trillions of dollars in derivatives globally. The guy who wrote that agreement helped draft the NAR. This was deliberate: model the rules on frameworks that have actually been stress-tested in high-stakes commercial contexts where failure means real money lost, not forum arguments about decentralization philosophy.

The NAR is a multilateral contract. It binds both BSV Association AND all nodes. BSV Association can’t act outside the rules. Their powers are explicitly constrained to the original Bitcoin protocol as described in the white paper. “Set in stone” is now a legal commitment, anchored to a fixed external standard, enforced through contract law. Any enforcement action requires BSV Association to act “reasonably and in good faith,” with full due process through the enforcement rules (Part III) and dispute resolution rules (Part IV), which means the process has more procedural safeguards than most government regulatory actions.

And the anchor doesn’t move. The NAR is tethered to an external, unchangeable standard: the original Bitcoin protocol. You can’t “update” a contract to contradict its own core premise. That’s how contract law works, and the people who drafted this document understand contract law better than anyone complaining about it on social media. 

Compare that to BTC’s “rough consensus,” where rules change based on who shows up to a developer call. Compare it to Ethereum’s governance, which literally reversed a blockchain to bail out a DAO hack. 

BSV published everything at nar.bsvblockchain.org. Every rule, every enforcement mechanism, every dispute process, every constraint on BSV Association’s own authority. Clear rules, published publicly, binding everyone equally, including the people who wrote them.

The counterargument is always “make it a democracy.” But turning BSV Association into an open charity with democratic governance would actually increase the attack surface. That would bring factions and voting blocs, and whoever organizes best wins. That’s how protocols get captured. Rules-based systems resist capture because the rules apply regardless of who holds power, while political systems invite capture by design. I supported BSV precisely to prevent that, and I will keep supporting the model that makes political capture structurally impossible.

Connor Murray, Ásgeir Óskarsson, and Siggi Óskarsson, and the people whose names don’t appear in public threads but whose work holds the system together, deserve real credit here, because they built a governance framework that functions under pressure without requiring anyone involved to be perfect.

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Anti-fragility through acceptance

Nassim Taleb gave us the vocabulary for this: systems that suppress volatility become fragile, and systems that absorb shocks get stronger. Anti-fragility is the capacity to benefit from disorder, from the unexpected, from the stresses that would break a rigid system.

Bitcoin’s “messy” consensus was the anti-fragile design. Race conditions meant no single entity could control the outcome. Competitive mining meant the network’s security scaled with commercial incentive. Lack of cryptographic finality meant the system required continuous economic participation from miners who had real money on the line, not hobbyists running software in a closet.

Every attempt to “fix” Bitcoin (BIPs, soft forks, UASF, SegWit, Lightning Network) has made BTC more fragile and more dependent on trusted intermediaries who introduced exactly the kind of counterparty risk that Bitcoin was designed to eliminate. Every “improvement” added a new dependency. Every new layer added a new failure mode, a new set of developers to trust, a new attack surface to defend.

BSV took the opposite approach: Simplify, generalize, and lock the protocol, scale horizontally, build utility. 

BSV accepts the imperfections and builds despite them, because the alternative (reorganizing toward perfection) has classically been a massive cost to the BSV ecosystem too. Every governance debate, every internal fight about how things should be structured, every public thread framing the Association as the enemy at the exact moment the ecosystem is trying to establish credibility with regulators and legislators… all of that energy could have gone into building apps and acquiring customers, and the opportunity cost is real.

The response to every qualm is business development and success.

The response to governance complaints is more customers. The response to technical criticism is more utility. The response to market skepticism is more liquidity, more transactions, and more proof that the system works under load.

Bitcoin was never meant to be perfect. It was meant to be good. Good enough to work, good enough to scale, good enough that the imperfections create competition rather than fragility, and good enough that accepting its flaws and building on them beats chasing perfection and catching nothing.

BSV is good. Its governance and its protocol are good. None of it is perfect. And that, as I argued two years ago and will keep arguing until the industry figures it out, was always the point.

The best vengeance against your enemies is the laughter of your children. So, have kids, and go build something people use. Be good to each other. And stay focused.

This opinion piece is published to encourage discussion. The author’s views are their own and do not constitute legal, procurement, or policy advice, nor do they represent the positions of CoinGeek or its partners.

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Watch: History of Bitcoin with Kurt Wuckert Jr.