Arthur Hayes on Financial Privacy and the Possibility of BTC Hard Fork

At the Tangle in Taipei on July 3, American economist and crypto sceptic Nouriel Roubini and BitMEX CEO and co-founder Arthur Hayes didn't agree on anything except that "Facebook's Libra is not cryptocurrency." One of the reasons on that is, while Roubini took for granted that the success of Bitcoin should be measured by its transaction speed only, Hayes argued that there was a different measurement.

Roubini continued to criticize Bitcoin based on his assumption and said, as he has often pointed out, "This conference is not even accepting Bitcoin." But for Hayes, that is not the only use case.

For Hayes, the success of Bitcoin hinges on whether or not it can protect financial privacy, especially when cash - the most anonymous means of payment - disappears from society.

A day before the Tangle at the Asia Blockchain Summit 2019, Hayes explained to Cointelegraph the importance of financial privacy in detail and predicted that anonymous features would be added to Bitcoin through a hard fork.

One of the reasons why lots of financial institutions don't take Bitcoin or accept Bitcoin is that they can't cover their ass.

With Bitcoin, because its entire history of that money can be seen in public, if someone or some entity that is not permissioned by the government touches that money, that bank or financial institutions can possibly be liable because there is actually information for them to assess that.

If you want to break Bitcoin, all you have to do is to start telling financial service institutions that they cannot deal with certain addresses.

At a certain point, when one Bitcoin is not equal to another Bitcoin and not fungible across the world, then the entire protocol will be worthless.

From my opinion, if Bitcoin really succeeds and takes it into the next level, those anonymity features need to be added via a hard fork of Bitcoin.

As the fungibility of Bitcoin erodes and more and more Bitcoin gets pulled out of circularization because of the addresses that are touched in the past, people will realize that Bitcoin will be slowly being killed, and the only way to liberate it is to do a hard fork and become a truly anonymous Bitcoin.