Bitcoin Developer Sells All His Coins, Declares Digital Currency is Dead

The world’s media went critical, thermo-nuclear critical, when Mike Hearn – a former core developer in the open-source project that is Bitcoin, deemed it a “failed experiment” and revealed he was done with the cryptocurrency.

“But despite knowing that bitcoin could fail all along, the now inescapable conclusion that it has failed still saddens me greatly”.

Hearn believes that the bitcoin community failed in the governance of the code for the cryptocurrency.

“It has failed because the community has failed”, he writes. “What was meant to be a new, decentralised form of money that lacked “systemically important institutions”… has become something even worse: a system completely controlled by just a handful of people”, he said in a post on Medium.

Everyone is entitled to their opinion, and to that Hearn is no exception, but putting aside the technical issues of which there is already plenty of excellent commentary on why he is wrong, his motivation for proclaiming Bitcoin dead is something that needs to be considered. He addressed the banker conspiracy theory saying, “After I privately concluded Bitcoin wasn’t working I took a job with a startup that’s looking at how to apply distributed ledger technology in the existing financial system (R3 CEV)…”

Bitcoin is a failure, according to an expert and major supporter of the cryptocurrency.

Despite Hearn’s gloom, Davies says that “Almost on a daily basis, it’s getting more traction in the real world”.

Hearn, who is one of the five senior developers who had spent over five years working on the web-based currency, said he would no longer be taking part in development.

In fact, these two things largely contributed to an nearly 10 percent decrease in Bitcoin value on Friday. That puts effective control of the system into the hands of a relatively small number of ‘miners, ‘ which is not what the original concept intended.

Covering the bitcoin story of last week (Cryptsy’s revelation of insolvency came a distant second in comparison) was Todd McDonald, co-founder of R3 who shared his thoughts on the company’s blog.

Hearn was chosen by Bitcoin’s enigmatic creator Satoshi Nakamoto to succeed him when he stepped down in 2011.

There have been frequent periods in 2015 when bitcoin wasn’t able to keep up with the transaction load being placed upon it. When networks run out of capacity, they get really unreliable.

This past August, Hearn along with Andresen released another version of the existing Bitcoin XT software, which would increase its size to 8 MBs, allowing for as many as 24 transaction per second to be processed. He added that he has sold all his Bitcoins and will no longer be involved in software development going forward. This, Hearn says, is probably the limit of what bitcoin can achieve, unless capacity is increased. The rift cropped up from the increasing congestion on the bitcoin network mainly due to the size limits in account of transactions within the virtual currency.