The Culprit: Blockstream Founded by Adam Back in 2014, Bloc…

The Culprit: Blockstream
Founded by Adam Back in 2014, Blockstream was officially launched in 2015. Unlike the common foundation model prevalent in the industry, it is a purely for-profit enterprise with products, employees, and investors. It does not rely on community fundraising, donations, or self-funded operations. The company’s core influence lies in its employment of the vast majority of active Bitcoin Core developers, giving it near-total control over Bitcoin’s sole development team.
Bitcoin was originally designed as a peer-to-peer decentralized cryptocurrency, inherently rejecting any profit-driven intermediary role. However, as a for-profit corporation, Blockstream had to find a path to profitability—and its solution was to create intermediaries itself. Adam Back, its CEO, has explicitly stated that the company plans to generate revenue by selling sidechains to enterprises, charging fixed monthly fees, collecting transaction fees, and selling hardware devices.
A sidechain is an independent blockchain pegged to Bitcoin’s value. Users transfer 1 Bitcoin to a smart contract and receive a corresponding new token on the sidechain. Sidechains can offer enhanced smart contract functionality, instant transactions, or anonymity features. The key difference from the Bitcoin mainchain is that transaction fees on sidechains are not distributed to miners, but retained by the sidechain developers.
Behind this distinction lies a blatant conflict of interest. Blockstream’s profitability depends entirely on the functional limitations of the Bitcoin mainchain: the more capable Bitcoin itself becomes, the lower the demand for sidechains; the more restricted Bitcoin is, the more users will rely on sidechains, and the higher the company’s profits will be. All of this is premised on its control over Bitcoin’s development direction.
Two extreme outcomes are clear: if the Bitcoin mainchain achieves full scalability with stable instant transactions and universal smart contract capabilities, sidechains and layer-2 networks will become obsolete, and Blockstream will lose its revenue stream. If the Bitcoin mainchain remains unscalable, with erratic transaction confirmation times, exorbitant fees, and no smart contract functionality, Blockstream can profit indefinitely from these flaws.
The facts after 2015 bear out the latter scenario. Bitcoin’s block size has never been increased; transaction fees swing wildly; confirmation times are highly unstable; zero-confirmation instant transactions have been removed; and opcodes supporting smart contracts have been deleted. Aside from minor compatibility upgrades to accommodate layer-2 networks, technical progress on the Bitcoin mainchain has completely stagnated. Meanwhile, Blockstream has poured all its efforts into developing its own layer-2 solutions, including Liquid and the Lightning Network. These so-called “scaling solutions” are, more accurately, fee-extraction layers.
On the surface, they appear to restore Bitcoin’s original functionality, but in reality, they shift fee revenue and decision-making control from miners to developers. As Blockstream raised massive funding, the need for these fee-extraction layers became even more urgent. The company has raised over $80 million from major institutions including Allianz Strategic Ventures and Digital Currency Group—entities with close ties to Mastercard, the Federal Reserve, the Bilderberg Group, and various central banks. This has further fueled public doubts about the motives and ethical integrity of its management.
It is clear that Blockstream’s philosophy has long diverged sharply from that of Bitcoin’s early community, which is the fundamental reason why the vast majority of early community members have abandoned the Bitcoin mainchain.