Topic: Bitcoin is Not An Organization (Read 371 times)

Bitcoin as a decentralized autonomous organization
Bitcoin “runs a payment system…employs subcontractors who are miners… paid for with newly issued bitcoin shares in itself” (Vigna and Casey 2015, p. 229, quoting Larimer 2013).Footnote2 The Bitcoin system thus shares the four core features common to all conceptualizations of “organizations”: it is a “multi-agent system […] with identifiable boundaries and [a] purpose […] towards which the constituent agents’ efforts make a contribution” (Puranam 2017, p. 6). But in contrast to traditional organizations, Bitcoin does not have a CEO or top management team but instead developers who “write the rulebook,” i.e., define governance rules for the program (Narayanan et al. 2016, pp. 173–175). Bitcoin does not have headquarters, subsidiaries, or employees, but a distributed network of users and miners who collect, verify, and update transactions on a shared public ledger that is publicly auditable. Decisions on code modifications are made through community-based democratic voting processes, backed by miners’ computing power for implementation (Narayanan et al. 2016, pp. 173–175).

Two significant innovations underpin Bitcoin: a technological one, namely the public and distributed ledger technology called “blockchain,” which securely maintains an immutable record of all user transactions, and an organizational innovation, namely, the existence of an open network of users with special roles and rights called “miners”, who lend computing power to secure the network in exchange for newly minted bitcoins and voting rights with respect to future protocol revisions (Davidson et al. 2016a, 2016b).

To an extent, you may call the miners as an organization--a decentralized one--but not bitcoin itself. Bitcoin is a currency on the digital realm that is backed by cryptography and math. The ones who solve these complex equations in order to mint new bitcoins and process transactions within the network are the miners, and the only ones that can be appropriately tagged as an organization no matter how crude the meaning could be. Those are two different things, and the next time don't mix them up.

Well just to be certain I've looked the wikipedia exact definition on DAO's.
"A decentralized autonomous organization (DAO), sometimes labeled a decentralized autonomous corporation (DAC), is an organization represented by rules encoded as a computer program that is transparent, controlled by shareholders and not influenced by a central government. A DAO's financial transaction record and program rules are maintained on a blockchain. The precise legal status of this type of business organization is unclear."
It is clear that in this model there is control by shareholders, something that is not true for Bitcoin.

Don't get caught up on this word though. Organization can mean different things in other languages. In it's original language Greek it has a few meanings. Mainly it is a group of people that are joined to achieve a certain goal. It can also mean a movement following certain agenta, or as a verb, the act of doing something after having it thorougly planned before. So the word probably does not mean the same in all languages. Although an organization in business and economic terms, means that there is certain authority running it.

In Bitcoin the only authority is consensus. The code itself. It can be changed but it needs agreement between everyone involved, from miners to exchanges and developers, along with the whole community.

[EDIT] I feel confused now. Perhaps it is an wider organization containing everyone that can agree on changes in the code. I would certainly bookmark this topic as I'm undecided even after careful consideration.

By the way as stated by other members, Bitcoin is not an industry either. Cryptocurrencies as a whole can be considered an industry, so your teacher was definitely wrong there.

They don't, the code does. This code, or set of rules everyone involved with Bitcoin agreed upon before getting in.

You see, the code wants blocks found every 10 minutes. The creator decided to adjust that every 2016 blocks or two weeks, and that's what the code executes.

How do you call the miners, node operators, the core developers, and the community (here)? I don't really know, followers of the code? There is an industry surrounding Bitcoin, but that's not exactly it. There is no formal organization either, no one gets to decide anything, its already done.

Yes there is a bit of deciding, by (almost) everyone involved when a change is introduced in the code, because if people don't agree, they won't use it. The current Bitcoin iteration has had some modifications since its inception, accepted by the majority. Its part of the rules (code).

we dont know if btc is created only by one people ? ( satoshi ) or created by many other more , if yes then its safe to call it an organization because its compose of many other people    .

 that defines organization based on my own knowlege  but your prof is also correct too that bitcoin can also be refered to as an industry ( industry in finance ) since its related to currency/monetary    . what i only dont like with your prof is that he got easily angry for that matter and he take thing seriously   . that only shows that he isnt a profesional teacher  .

I also think the term "industry" is an understatement for bitcoin. We are facing an epochal change, both cultural and economic.

For me, bitcoin is not an organization. Maybe the founder or the creator under the alias "Satoshi Nakamoto" may be an organization. bitcoin is a currency, bitcoin is a crypto. I think your professor is right that bitcoin is not an organization. Bitcoin is a coin that no one holds (except I think for Satoshi), even the government didn't have the authority to control the cryptocurrency

You are lack of knowledge on how Bitcoin works and your professor is to good to correct you of your misconception, I am not an experts but the goal of the Cryptocurrency is to be decentralized makes it a non organization, you just go back and learn the theory and the concept so you'll now it is not, and what part of Satoshi's theory that you read that makes it an organization.

Bitcoin is not an organization, it is an opportunity that , unfortunately, few people know how to use.

That's correct, its not an organization as an organization there is a head or group of people who controls it.
This is more like an industry that opens for any business who like to adopt with it, and as an industry it's growing since the adoption is also growing, maybe the biggest industry as the gambling industry, financing, and many others can adopt with crypto or bitcoin.

I think you and your professor are both wrong. Bitcoin is not an organization neither is it an industry lol.
Bitcoin is a network or technology and it’s not owned by anyone at all since it’s decentralized. You can as well call it a peer-to-peer transaction system, the transactions are sent directly from person to person without the need for intermediaries.

If it was an organization or industry as you and your professor said, then that organization would have acted as an intermediary, but since it’s not owned by anybody they can’t do that and neither can any one else. So, bitcoin is a network, you should read more about it online.

Bitcoin is probably like the internet, (though internet is fairly centralized).

Bitcoin is not owned by anyone or better still, it is community owned. I think its principles would prevent it from being run like how communist societies run/ran things.

It's just a very different model...a far better model in my opinion.
You can build decentralized applications/things and the profits still goes to you and co-owner, but the profits should be used in such a way that it does not affect Bitcoin or its principles. Profit sharing with your community is also important, for the good of the "owner" and his/her community

I believe both of you are correct.  It's that, you are looking at Bitcoin in different point of view.  I can describe your argument as describing an elephant blindfolded touching on a different part of it, e.g you touching the body and your professor touching the tusk.  You can both come out with different description but neither of you is wrong.

Bitcoin is not just the devs and bitcointalk. Bitcoin actually can run very good without the current devs(*) and without bitcointalk.
And then what remains? Miners and pools which compete for resources, various nodes made for various reasons (from being nice to supporting a business) and plenty of users - investors, traders, speculators, people who work for Bitcoin, people with businesses in Bitcoin and so on.
This is by no means something organized.

I think that one of the reasons Satoshi has disappeared is to avoid Bitcoin become an organization under the lead of dev team.


(*) Some may argue about the devs and I will come with an idea. What if multiple dev teams emerge for Bitcoin and their ideas differ? Well, the nodes should ultimately decide which change they go with and the others will have their fork. This is the "power" of consensus.

Definitely.

But somehow it does make sense to me that Bitcoin is an organization ( don't take literally ) since our common denominator here is the bitcoin in general, just like being in an organization where there is a clear goal of one's individual (Satoshi Nakamoto) to make a difference and so us joined him by supporting his product. It is just like Satoshi the creator is the founder of this and we are all just members, and whales are the admins  I'm open for further opinions.

The right words are 'Bitcoin is a protocol'... It can't be an Organization because is decentralised. Once I say bitcoin is like the state powers (a legislature, an executive, and a judiciary), it's divided by Developers, Miners, and Users, And to take a decision all of them must agree.

In a way the way a small group of people in bitcoin make the decisions of increasing / lowering the difficulty of the network, it could somehow be interpreted as some sort of federation, isn't it? Maybe I don't understand enough. COuld someone clarify this to me?

You are right. In this case, Professor probably thinks that Bitcoin isn't a kind of currency created by an organization. He assumes it is just a product of an industry (digital asset sector). But why not to try looking for the theory based on Bitcoin WP. Maybe get something useful there.

Agree. Imagine when we build a house. It must begin from the foundation first before planning other things. It's never done properly if we forced to start with the roofs firstly.         

I wouldn't actually say that Bitcoin is a decentralized autonomous organization either.

Changes aren't implemented based on community votes or any kind of specific governance structure, nor node holders play any role in voting in new BIPs.

Not sure how you can compare with a DAO which clearly has a decentralized business-like structure....

I agree with this.
We don't know how you ended up with that description about bitcoin OP but your professor is not also right telling it's an industry or just a thing. Maybe you can still get to defend what you have said by saying that it's the currency of the people and that's why you have made that kind of description but it's obvious not an organization.