an x <a target="_blank" href="https://x.com/AnitaPosch/status/1866543761406488655″>mail by Anita Posch The warning about the risks of governments and institutions purchasing large amounts of bitcoin went viral this week, if only because of the <a target="_blank" href="https://x.com/L0laL33tz/status/1866799589094785421″>note from the trollish community that appeared beneath him. I think the main concern here is that these large holders could influence bitcoin's consensus rules to impose censorship.
When it comes to censorship specifically, mining centralization is actually a more direct threat. But if it's just censorship by miners, it will only last as long as the majority of miners are willing to keep doing it, at the cost of losing transaction fees. If the censorship stops, transactions would begin to be confirmed again as if nothing had happened.
However, if economic nodes were to also impose censorship as new protocol rules, a soft fork could indeed be considered. In this scenario, miners cannot exit censorship without splitting the blockchain between “upgraded” (censorship) and non-upgraded nodes; that would constitute a hard fork. Buyers and sellers of the two versions of bitcoin would then determine which blockchain is more valuable; That's why some bitcoiners are concerned about governments and other large institutions hoarding a significant portion of the bitcoin supply.
It's a reasonable concern and something to keep in mind. At the same time (and similar to my argument in this take), it is not obvious to me that governments or large institutions are willing to risk everything by betting on a bitcoin censorship fork. But even more importantly, there isn't much we can do to stop governments or other institutions from purchasing bitcoin, nor should there be, since that would (ironically) itself represent a form of censorship.
The best countermeasure in this regard was already proposed by Nikolaus: not to sell your bitcoins to MicroStrategy.
This article is a Carry. The opinions expressed are entirely those of the author and do not necessarily reflect those of btc Inc or bitcoin Magazine.
