False Premises, Failed Promises: BTC's Market Illusion and the Abandonment of Bitcoin's Design

Craig S. Wright
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Craig S. Wright: Department of Economics, University of Exeter

No 2502, Discussion Papers from University of Exeter, Department of Economics

Abstract: BTC, diverging fundamentally from the original Bitcoin protocol, has attained outsized market capitalisation despite abandoning Bitcoin's primary function as a scalable, traceable system for electronic cash. The Lightning Network, frequently misrepresented as a Layer 2 solution, is demonstrably a separate payment routing structure that never requires final settlement on-chain. This paper deconstructs the economic, technical, and ideological divergence of BTC from Bitcoin, critiques the architectural and empirical failure of Lightning, and examines the speculative mispricing driven by false narratives, branding confusion, and structural ignorance.

Keywords: BTC; Bitcoin; Lightning Network; digital cash; scalability; protocol divergence; Layer 2; micropayments; transaction finality; network economics (search for similar items in EconPapers)
JEL-codes: E42 G18 L86 O33 (search for similar items in EconPapers)
Date: 2025-07-01
New Economics Papers: this item is included in nep-net and nep-pay
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Persistent link: https://EconPapers.repec.org/RePEc:exe:wpaper:2502

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