I think the logic that his work is unpublished itself is wrong, he published/posted his work for world to see in arXiv , He has very strong opinions about current scientific publishing status quo, hence did not go through usual route of submitting in journal, He did published/posted on arXiv. Who are we to decide that posting your work in Blog post , arXiv etc does not constitute published.

It becomes a problem if the people with the money want it. Grant proposals usually require you to list your important and relevant "published" papers.

There is actually two aspects about "published". One is archival, so people can expect to access the work decades later (if they have to pay for that is another discussion). The second aspect is peer-review aka quality control.

Personally, I once submitted a paper to a workshop. After submission, peer-review, and acceptance the workshop committee decided that they will not publish proceedings. I could have submitted the paper elsewhere, which I find weird. Instead I published it as a techreport. However, it is now unusable for proposals, because a techreport is "not published" even if it is properly archived and went through peer review.

> However, it is now unusable for proposals, because a techreport is "not published" even if it is properly archived and went through peer review.

IMO, the definition of 'published' is a huge issue. I have always read published as archived peer reviewed research. Your paper is both, but remains in an not published state which I think is wrong and hinders future research.