Mike Hearn Disputes Claims of a Banking Conspiracy against Bitcoin

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January 19, 2016 3:08 AM UTC

Mike Hearn has penned a new post as a follow-up to his much-discussed and debated public farewell to Bitcoin.

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. Hearn’s declaration resulted in massive coverage that was predominantly negative and dismissive of bitcoin, using a former core developer’s words to aid the overall narrative.

The widespread attention, negative or otherwise was predictable. So too were conspiracy theories that soon followed, pointing to the timing of Hearn’s Medium post and the New York Times article that were published within hours of each other. Chief among the conspiracy theories were suggestions that Hearn’s post was supported or suggested by his new employers – R3.

For all the banks R3 has amassed as partners – there’s 42 of them, globally – little is known of what R3’s efforts behind its doors. While it’s common knowledge that the R3-led banking consortium is looking into distributed ledger technology for the current financial industry, it is yet unknown if all participating banks are seeking at a private ‘blockchain’ that will come to fruition among themselves alone. From what has been revealed thus far, they’re a private working group, unlike the IBM-led blockchain endeavor that is quick to distinguish itself as an ‘open-source blockchain.’

There are plenty of questions here, certainly more than answers and this has fanned the flames for those who suggested a conspiracy by the banks to deal a blow to the bitcoin industry.

With his newest Medium post, Hearn discredited these suggestions of a conspiracy and those that claimed he had profited with the cryptocurrency with his now-controversial previous post.

I sold the last batch of my coins in December, a few days after the second “Scaling Bitcoin” conference. Since that time I haven’t had any positions in any cryptocurrencies, long or short, and no way to make profit or loss off anything that is happening to Bitcoin.

Some people suggested that there is some sort of banker conspiracy, because 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).

Hearn added that his job profile was no secret, with mentions about it in the press in the past, as well as the New York Time article that featured his exit from the bitcoin industry. Hearn also wrote about why he did not mention R3 in his own post, noting:

R3 is not a Bitcoin company, or even a cryptocurrency company, and there is no “BankCoin” or “R3Coin.” So this is really nothing to do with them and conspiracy theories are just a waste of time when there are more serious things to consider.

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. The post, which Hearn also references to in his latest Medium outing lays to claim that Bitcoin and R3 can co-exist and aren’t competitors to each other.

McDonald said:

…this concept of one side or one approach ‘winning’ over another, or that there even is a contest, baffles me. Success for R3, does not need to come at the expense of Bitcoin.

The post even revealed the banking consortium’s co-founder’s thoughts about bitcoin and R3 co-existing and even helping each other’s cause.

It is more likely that traction for either camp would be a massive positive for the other.

Hearn echoed his employer’s comments, stating:

I see things the same way. Bitcoin competes with some things banks do but a big part of banking is about lending and trading, and those activities would still occur even in a world where Bitcoin was the one global currency.

It’s not a zero-sum game, banks and Bitcoin co-exist, and R3’s fate is independent of Bitcoin’s.

Featured image from Shutterstock.

Last modified: May 21, 2020 10:35 AM UTC

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Samburaj Das @sambdas

Samburaj is the Chief Editor of CCN.com, one of the earliest and foremost publications covering blockchain, cryptocurrency, and financial technology news. He has authored over 2,000 articles for CCN.com. Reach him at samburaj@ccn.com. Visit his LinkedIn profile here or his Muck Rack profile here.

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