BlackRock ETF: Trojan horse in Bitcoin network?

In a long post explained Twitter user @BTC_Culture the theory. A first supposed proof is BlackRock’s ETF application itself. In it, the asset manager explains the effects on investors of a potential Bitcoin fork.

BlackRock, in its sole discretion, will determine which network is to be deemed an appropriate network. […] There is no guarantee that BlackRock will select the digital asset that is ultimately the most valuable fork.

This text raises many questions for Bitcoin supporters: “In case of a hard fork, why shouldn’t BlackRock choose to support the most valuable Bitcoin fork? Will BlackRock create the fork itself and force their investors onto their chain?” Some compare the Bitcoin ETF with a Trojan horse. In other words, BlackRock helps boost BTC price and then destroys the network. What’s behind it?

BlackRock attack: just a conspiracy theory?

It is not surprising that Bitcoiners are critical of the BlackRock ETF. After all, the asset manager is a centrally controlled player on the global financial market. Even more: BlackRock CEO Larry Fink is a member of the World Economic Forum (WEF) – and that continuously attacks Bitcoin. Coincidence? Not for @BTC_Culture. Two other players in the conspiracy: Ripple and President Biden, also with Connections to the WEF. Both parties are bothered by the energy consumption and have already taken action against it in the past, for example with a Greenpeace campaign or a high mining tax.

The conclusion from all these supposed connections: BlackRock is trying to turn Bitcoin into a Proof of Stake (POS) cryptocurrency. The already existing Bitcoin POS has failed without a sound. With the influence of the largest asset manager in the world, however, the project could work, according to the theory. After all, according to the application, the ETF investors would have no voting rights anyway. So BlackRock could use the money from many big institutions to initiate a Bitcoin hard fork and turn it into a POS cryptocurrency – right?

Honey Badger don’t care

Wrong, that’s not how Bitcoin works. Proof of Work is a feature and not a bug. Precisely because Bitcoin does not work via POS, every network participant has the same voting rights. A node operator has as much influence on the decision as the most powerful financial institution in the world.

This is not just theory, but fact. An example: the blocksize war. At that time there was a lot of criticism of the slow Bitcoin network. In order to scale up, they wanted to increase the block size from the original one to eight megabytes. This idea was supported by mainly large players such as Blockstream, Bitmain and Coinbase, but also by many miners. Ultimately, the majority of the network decided against it. The individual node operators argued that the data load would increase too much with the increased block size and the network would become more centralized. Out of the disagreement emerged Bitcoin Cash – a failed attempt to change Bitcoin.

Whether the conspiracy theory that BlackRock is attacking Bitcoin from within is true or not, power is decentralized. The network inevitably chooses the right version. And: For Bitcoiners, a change in the consensus mechanism is hardly imaginable anyway. After all, Bitcoin is not Bitcoin without Proof of Work.