With an increasingly divided Bitcoin Cash (BCH) community at what appears to be an impasse ahead of today’s planned upgrade, the next few days will certainly be interesting for observers. Two distinct factions appear to have coalesced around the soon-to-be incompatible BitcoinABC and BitcoinSV clients respectively, both of which have planned upgrades that will make them incompatible with one another. BitcoinABC was the “main” BCH client at the time of the original split last year, and has the backing of the most vocal BCH developers and several exchanges, whilst BitcoinSV is ultimately controlled by nChain’s Craig Wright with the backing of Calvin Ayre of Coingeek.
As the contentious hard fork date has drawn closer over the past months, the rhetoric from one side in particular has been heating up, with Craig Wright making increasingly bizarre threats that look set to culminate in a “hash war”. Over the past weeks, a large amount of BCH hashpower has been building up under mining pools associated with Calvin Ayre (Coingeek & SVPool), such that they now have in the region of 70% of hashpower according to Coin.Dance estimates. This hashpower is central to Craig’s threats to wreak havoc on the ABC chain to the extent that all it’s proponents are forced to concede and his “Satoshi’s Vision” chain will be the only Bitcoin Cash in town.
Since the original hard fork that lead to BCash last year, mining industry behemoth Bitmain and Roger Ver’s Bitcoin.com have been the dominant force supporting the chain with hashpower clout, but IPO ambitions and the greater scrutiny associated with a public offering are thought to be constraining the Bitmain’s ability to continue to assert its dominance in the face of increasing losses. At the same time, Roger Ver appears to be having something of a crisis of confidence in the Bitcoin Cash experiment in the face of the looming contentious hard fork, as evidenced by his recent Youtube video.
The divide appears to boil down to differing visions for the future of the cryptocurrency, which has resulted in two completely different and consensus incompatible upgrades. The BitcoinABC update includes a change known as CTOR (Canonical Transaction Ordering) which changes the way transactions are arranged within a mined block, such that they are ordered by transaction ID. This is claimed have benefits including being a path towards improved block propagation times, even with increasingly large block sizes. There is also a new OPcode known as OP_CHECKDATASIG, to enable oracles and a form of smart contract to be used on BCH.
The SV team have rejected the changes proposed by ABC and their new client is claimed to have been created by nChain at the request of Coingeek to move back to “Satoshi’s Vision”. It intends to do this by restoring old opcodes, removing limits on the number of opcodes per script, and raising the maximum block size to 128MB.
The two consensus incompatible clients do not have replay protection, which means very few sensible entities will dare to attempt transactions until the dust has settled. When the hard fork occurs, a little after 04:40PM UTC on November 15, one client will mine a block that is invalid for the other and there will technically be a chain split. However, without replay protection, transactions sent on one chain will ultimately be subject to replay on the other – a scenario which caused huge problems for unprepared exchanges in the ETH/ETC split.
Craig Wright’s increasingly baffling Twitter rants seem to imply there could be a significant period of turbulence ahead for the Bitcoin Cash community if as claimed Coingeek are prepared to mine at a loss for an extended period in order to exert their dominance. If “honest” ABC client miners are unable to successfully sustain an ABC chain in the face of Coingeek mining empty blocks and orphaning the “honest” blocks, the SV chain will be the only “functional” BCH remaining. Faced with this prospect, ABC developers have publicly mentioned the “nuclear option” of a further hard-fork to implement a proof-of-work algorithm change away from SHA256.
Unless Bitmain or another entity deploys sufficient additional hashpower or diverts existing ASICs focussed on Bitcoin (BTC) towards controlling the ABC chain, there is likely to be a chaos over the coming days for anyone trying to send or receive BCH. Exchanges will have to keep deposits and withdrawals closed for extended periods, until there is some form of clarity, and major wallet providers such as Trezor are supporting ABC, but advising users not to transact “until things settle”.
In summary, the BCash activity over the next few days will be fascinating to observe and nobody appears to really know what is the most likely outcome. The “market” across the handful of exchanges which are offering pre-fork trading appears to have a slight preference towards BCHABC going into the day of the event. Coin.Dance offer a useful site to keep track of things as events unfold and the different clients diverge.