The Bitcoin Cash blockchain will undergo a controversial round of network upgrades on November 15. As with previous community divergence, this upgrade may cause the Bitcoin Cash project to officially fork into two chains, BCH ABC and BCH Node.
The fork stems from a lack of money for developers
The core developer of ABC, Amaury Séchet, has repeatedly expressed dissatisfaction with the status quo of BCH developers, the most important of which is the lack of funds for developers.
In order to solve this problem, the BitcoinABC (hereinafter referred to as ABC) development team supported the “IFP plan” proposed by Jiang Zhuoer. The plan, also known as the “Infrastructure Financing Plan,” proposes to transfer 8% of the blockchain mining rewards from the hands of BCH miners and transfer them to the development team for their own control.
Séchet said at the second BCH developer conference in February this year that the appearance of the “IFP plan” was due to repeated requests from the Chinese community, and it has lasted for more than two years. “They want an infrastructure agreement. This is not a controversial idea in China, but it is obviously very controversial in the West.”
Such ideas are not new, and the privacy token Zcash has had similar funds for many years. However, people in the BCH community think this is a robbery and believe that this approach runs counter to the decentralized spirit of cryptocurrency.
BCH supporter and Bitcoin.com founder Roger Ver said in a tweet in August this year, “The transfer of part of the #BitcoinCash block reward to the development team is undoubtedly a continuation of the Soviet-style central control system. Please stop this behavior.”
The simple ledger protocol used to issue security tokens on the Bitcoin Cash blockchain also expresses a similar tendency. The protocol spokesperson wrote on the blog, “We believe that the practice of redirecting block rewards does not represent the spirit of Bitcoin Cash, and this is only a unilaterally announced rule by the development team.”
Due to the IFP plan, a new development team, Bitcoin Cash Node, was born in February this year, mainly composed of Bitcoin Unlimited and Electron Cash. The initiator was the early BCH developer Freetrader. He participated in the 2017 BCH fork and is a member of ABC. .
The team believes that there is a need for the donation plan, but it should not be mandatory, otherwise it will easily cause corruption, and more importantly, it violates the spirit of blockchain decentralization.
BCHN is supported by most miners
This round of network upgrades is scheduled for November 15, but the most likely result is that most miners will support the BCHN version instead of the ABC team version, and the ABC version will become a minority by then. If things really go this way, this upgrade will cause splitting consequences. Bitcoin Cash will eventually become two independent chains, and each chain has its own value and audience.
In the past few months, BCH miners have been discussing where to go after the fork. As of now, 82% of miners oppose the ABC team’s proposal. Some people also write messages (such as “PoweredbyBCHN”) in the newly mined blocks to express their support for the BCHN version.
Many exchanges have expressed their plans to support network upgrades. But if BCH forks, they will support chains with more hashing power (that is, more Bitcoin Cash miners support).
In addition to expressing support for network upgrades, the cryptocurrency exchange Crypto also added that “If there is a competing chain, Crypto plans to only support chains with stronger hashing power.”
Huobi also supports Bitcoin Cash’s changes, but it provides a disclaimer in the support: “Because of the current uncertainty of the fork, if one of the two parties decides to abandon the fork, Huobi will choose Bitcoin Cash based on community opinions. The true successor.”
OKEx announced that after the completion of the BCH fork, a chain with a higher price will be selected as the underlying asset of the contract and added to the BCH contract index component, and Bithumb Global will select the solution that will gain more community support and name it “BCH”.
However, the exchange Kraken stated that it will support BCHN regardless of the outcome of the fork. On its platform, BCHN will be called BCH. Only when BCHA’s computing power accounts for 10% or more of the BCH network, the platform will support BCHA services, and the token code will use “BAB”.
The hardware wallet Trezor parent company SatoshiLabs announced that SatoshiLabs will not participate in the fork until the community makes a decision. If users wish to participate in the fork, they should transfer their BCH balance to another wallet that supports the fork to ensure they receive any tokens generated by the fork.
3 changes after the upgrade
This upgrade mainly contains three changes. According to the Bitcoin Cash website, the network upgrade will change the difficulty adjustment algorithm (DAA), Coinbase rules, and automatic replay protection.
First of all, regardless of the final choice of BCHN version or ABC version, the original DAA will be replaced. The new version will use the ASERT algorithm. The upgrade page on GitHub shows that this alternative algorithm will eliminate Bitcoin Cash’s mining difficulty and hash rate changes.
In addition, the alternative algorithm can ensure that stable miners and temporary miners who transfer between different blockchains have equal mining revenue. This update also keeps the creation interval of new blocks at around 10 minutes as much as possible. Finally, the ASERT algorithm will also strive to improve the average transaction confirmation time and provide a more stable trading operation experience.
The second part (applicable only to the upgraded version of ABC) is the Coinbase rule and the origin of this dispute (it has nothing to do with the exchange, where coinbase refers to the newly mined specific block part). It requires 8% of all block rewards to be sent to a specific Bitcoin Cash address and controlled by the ABC development team.
Finally, Bitcoin Cash will welcome replay protection after the upgrade. This is to separate all unupgraded full verification nodes from the main network after the next round of upgrades on May 15, 2021.
Bitcoin ABC, the core development team of BCH, stated that it will continue to maintain BCH nodes after the fork. Bitcoin ABC said that after the fork, it will support two chains, BCHN and BCHA. If a company wants to support the chain that is funded by block rewards for its own network development, the BCHA chain, it should run Bitcoin ABC 0.22.6 (BCHA network), or any previous version 0.22.x; if the company wants to support The chain that is funded by donations for its own network development, namely BCHN, should run the BCHN version: Bitcoin ABC 0.22.6 (BCHN network).
