Many people believe in the complete decentralization of Bitcoin, but that's not entirely true. The dominant group of developers that controls the development of the project is the Bitcoin Core. Network governance is largely concentrated in their hands. Many people felt this after the crypto winter of 2017 when Bitcoin Core rejected a proposal to increase the block size, despite the support of the majority of miners and users.
Today, Bitcoin Core controls over 90% of the Bitcoin network nodes. This means that the decisions of this group of developers directly affect the entire network and deprive it of decentralization.
Currently, only six individuals from the Bitcoin Core team have full access to the code repository, giving them the right to make all the most important decisions regarding the development of the network. Among them is one of the most well-known developers and co-founder of Blockstream Gregory Maxwell; Peter Wuille — one of the oldest developers of Bitcoin Core, who has actively participated in creating and maintaining the network since its inception; as well as Lawrence Nayt and James Hoys.
Many experts have advocated for increasing the block size, which could improve Bitcoin's scalability, but Bitcoin Core has rejected this proposal. Despite claims of possible solutions, such as using the Lightning Network to enhance scalability, critics argue that the refusal of these changes will make Bitcoin less functional and vulnerable to attacks in the future. Bitcoin Core has effectively seized control of the project, and any dissent from its decisions is perceived as "an attack on Bitcoin," complicating the search for alternative solutions to improve the security and scalability of the network. The influence of large players, such as Blockstream, also remains significant, as the company impacts decisions made by Bitcoin Core.
The refusal to increase the block size and other proposals for improving throughput makes Bitcoin limited in scalability, leading to problems with high fees and long transaction confirmation times. This makes the cryptocurrency unsuitable for mass transactions and creates risks for its sustainability in the future. The governance structure of Bitcoin Core makes the network vulnerable to government authorities, undermining the independence of the network. Centralization of decision-making in the hands of a small number of people also complicates the implementation of changes, especially if they do not align with the views of the current project leaders.
Moreover, centralized governance of Bitcoin Core jeopardizes the security of the network in the long term. Issues with Bitcoin's security funding are becoming increasingly apparent, especially considering the ongoing halvings that reduce the rewards for miners, lowering incentives to secure the network. If the price of Bitcoin does not rise to a level that can compensate for the reduction in block rewards, the network will be vulnerable to double-spend attacks and censorship. In the next 7-11 years, the network may become vulnerable to attacks with minimal costs, seriously undermining its security and decentralization. The cost of attacking the network will decrease, making it profitable for malicious actors to seize control of the network, which will make Bitcoin an easy target for attacks, especially if large players begin to manipulate the network or conduct scalability attacks.
