Why doesn't Bitcoin just add Counterparty's features?
So why Counterparty? Why not just include the Counterparty features straight into Bitcoin itself? In this short video, shot on 8th Street's domino park, I discuss the ...
What's up party people? Chris DeRose here, Community Director of the Counterparty Foundation. I'm sitting in Domino Park on 8th street in Miami; a historic area where many Latin Americans come to play dominoes on an average weekend with their friends. And you can see that going on behind me. But for us, let's talk Counterparty. Today the video that I wanted to make was addressing the question, "Why doesn't bitcoin add the Counterparty features directly into bitcoin? Why is there this division? Why does Counterparty sit on top of bitcoin?" And there's a couple of easy answers for that right off the bat. Certainly it's been the opinion of the bitcoin developers that bitcoin should be stable, it should be secure, and it should be minimally expanding in terms of what it does.
We want to make sure that bitcoin settles into a place where it is very well trusted and the protocol does not change. I think that, two, selling the miners on the big change is a difficult proposition as well. Whenever we want to make changes to bitcoin, there's a large community that we have to market those changes to. But, in addition to that, I think that bitcoin is also settling into its role as a commodity, in the sense that it has an intrinsic value as a persisting specanism, and as a unit of record on the block chain. So with Counterparty, we're really in a stage where we're kind of figuring out how that commodity works. I think that the bitcoin developers don't want to see that addressed directly themselves, they want to outsource that to the community.
They want to community to use bitcoin in the same way that perhaps websites are using HTTP. You can see that happening, right now we have Colored Coins, we have Mastercoin. We have a number of other services which are leveraging bitcoin and leveraging the block chain in various ways. We don't really know exactly what the right implementation is. We don't really know where this is going and who's going to do it correctly. But we can expect that as time goes on and as these different altcoins compete, that there will be one emerging standard.
There will be certainly one emerging standard perhaps for smart contracts and probably, you're assuming that will be the same for user-defined assets. And as perhaps other uses grow alongside that, we will see that incorporated into the block chain. I think we are starting to see that, even already, in a very limited capacity. Right now, the Bitcoind developers have added an OP_RETURN functionality which adds support for 40 bytes of arbitrary data to be stored in any given transaction. That was a concession, in many ways, to all of these alternate cryoptocurrecies that are using bitcoin. And I think that's a sign of things to come.
I think that we will see 40 bytes expanded to 80 bytes. I think we'll take a very slow and cautious approach to bitcoin, while we wait for the community to leverage it appropriately, and while we see what happens to bitcoin in this model; how it gets used, perhaps how it can grow itself and add support for these functions intrinsically. There may come a time when Counterparty is an official extension of bitcoin to some degree. We don't really know just yet, it's still developing. But that's the gist. The short version is that the risk profile of bitcoin is such that we would resist these changes off the bat, if not in perpetuity.
And that's why we're not using Counterparty transactions directly into bitcoin. If you like this video, subscribe to the channel. I'm Chris DeRose, and you can tweet me your questions at @derosetech on Twitter, or email me at email@example.com. I'd love to answer any more questions you have, and thanks for watching.