UPDATE: Since I last posted this a few days ago, the Segwit2X fork had a fatal error that doomed its implementation. If Bitcoin had adopted it, it would have been a catastrophic failure costing tens of billions of dollars. This is the very reason why I focused on the competence of the development team and engineers in this piece.
The last several days have been quite the roller coaster ride for Bitcoin and Cryptocurrency holders. If you are new to this, fix your hair, have a sip of water, walk it off a little bit, then settle down and grab a seat. If you are a grizzled veteran, you’re likely a bit excited about the free fall (after months of going up, up, up) and your heart rate is probably a bit elevated, but nothing to lose sleep over — you know Bitcoin will be fine after the dust settles.
One thing that has been proven time and time again in the last 8 or so years is this: Bitcoin is not resilient or resistant to attacks. Bitcoin is much more than that — Bitcoin is Anti-fragile.
Antifragility is a property of systems that increase in capability, resilience, or robustness as a result of stressors, shocks, volatility, noise, mistakes, faults, attacks, or failures. Bitcoin has come out stronger after every attack on the system and this is no different from past attacks, nor will this be the last attack on the Bitcoin network.
So what is happening, you might ask? Simply put, the people running Bitcoin Cash are “plotting the death of Bitcoin” by launching a coordinated attack on the Bitcoin network. Why would they want to do this instead of just making a better version that people will actually want to use, and beat Bitcoin fair and square in the market? Did the Bitcoin Core team force their hand into doing something so desperate? Each side thinks they are right, so it is hard to make an objective call on the matter.
So I did a little bit more digging into it. Here’s what I came up with:
Bitcoin and BCash in a nutshell:
- Bitcoin (BTC) is the first cryptocurrency, while Bitcoin Cash or Bcash (BCH) is a hard fork of Bitcoin that was activated on August 1, 2017.
- BTC’s main value proposition is its decentralization, reliability as a store of value, censorship resistance, network effects, and being the “Digital Gold” of the internet age. They want the world’s wealth to transfer into the Bitcoin network.
- BCH’s main value proposition is that it claims to retain ‘the original vision” of Satoshi Nakamoto for Bitcoin to be a minimal-fee payment system, much like VISA or Paypal, and to be the “Digital Cash” of the internet age. They want the world’s entire population to be able to use Bitcoin for daily transactions.
I also did a lot of research into the nitty gritty on the strengths and weaknesses of both implementations, things like the blocksize debate, scaling, rising transaction fees, network congestion, and more, but I am afraid that would take up too much time and turn this piece into a boring technical discussion. Instead, I will focus on the development team behind both, the main public proponents of each side, and touch on the network’s miners and nodes.
The Development Team Behind BTC and BCH:
I believe this is probably the most overlooked and underestimated part of the Bitcoin project. Bitcoin is software, and as seen in the recent Ether Parity wallet hack that froze US$300M in user funds, tens of billions of dollars should never be allowed to be run on code that has not been extensively tested by the best engineers in the world. If you were to create a massive bridge that will transport millions of people across an ocean, would you hire low-level engineers to build and constantly maintain and upgrade it? You would want only the best to handle such a project. With Bitcoin, potentially trillions of dollars will flow through the network — we can’t have amateurs tinkering with the code.
- Bitcoin Core development has some of the best crypto-developers in the world working on the project. It has a large open source developer community with many casual contributors to the codebase, as well as research, peer review, testing, documentation, and translation. They have an unparalleled record of releasing well-tested and thoroughly reviewed code. In the last week alone, there have been over 100 commits on Github — the development is constant for the last half a decade and of the highest level possible for any open-source project. The confidence needs to be high because the project is now worth $100+ Billion. I would say you can be sure they are putting out top-notch code every single time.
- Bitcoin Cash, at the time of this writing, had one Github commit in the last 13 days. Their development team is composed of one to two full-time developers and a handful of unknown others. If you want to know who they are, you cannot even find them on the Bitcoin Cash Website (please correct me if I am wrong). The level of development on the project is largely untested, has no track record on how disputes between developers are resolved or when something is production ready, and no diverse set of developer testing. For an overnight $20 Billion project, this does not inspire much confidence in people.
The Main Proponents of Bitcoin & Bitcoin Cash: Who are the people behind the two?
Here is where it got a bit interesting.
- Bitcoin has the Bitcoin Core development team, a group software engineers that have been working on Bitcoin development for the last several years, mostly voluntarily. Known personalities are Dr. Adam Back, the inventor of hashcash, the proof-of-work system used by several anti-spam systems and is the work quoted by Satoshi Nakamoto himself as the basis behind Bitcoin’s POW system. He is also the CEO of Blockstream. Then there is lead developer Dr. Pieter Wuille, who discovered Bitcoin in 2010 and has been a Bitcoin Core developer since May 2011. In 2012, Wuille published BIP 32, which added hierarchical deterministic wallets to Bitcoin. SegWit is his brainchild, now activated in the network. Then there is lead maintainer Wladimir Van Der Laan, whose salary is paid by the MIT Digital Currency Initiative.
These people are software developers of the highest order, no doubt about that. They have been working on Bitcoin before it was cool, and naturally got the support of the largest players in the community simply on the merits of their work and their stellar past reputations.
- Bitcoin Cash’s, most well-known proponents are Roger Ver, Jihan Wu, Calvin Ayre, and Craig Wright , publicly championing their version of Bitcoin as the “real” Bitcoin and “plotting the death” of Bitcoin. Of these people, only Dr. Wright is a programmer. These are the owners of Bitcoin Cash- They control its code, its mining, its nodes, its marketing, everything. Not only do they claim BCash should be called the only Bitcoin, they have claimed that it is “the only Blockchain that can do it all”. Some quick research on the backgrounds of these people reveal a few things:
Roger Ver was one of the original Bitcoin “evangelists” and did a lot to help Bitcoin early on, investing in several big companies such as Blockchain.info and Localbitcoins, and was known as “Bitcoin Jesus”, but now known more as “Bitcoin Judas.” He is also the CEO of Bitcoin.com, which has nothing to do with Bitcoin but is actually a BCash website. He is also a convicted felon in the US after serving 10 months in Federal prison for selling explosives on Ebay. He is the main proponent of Bitcoin Cash.
Calving Ayre, a billionaire, was, in 2013, in the top 10 Homeland Security most wanted fugitive list in the US for illegal online gambling and money laundering but was then cleared of his charges in early 2017. He owns Bodog, one of the biggest online gambling platforms. He also insists that BCash should be called Bitcoin, even though he has never contributed anything to actual Bitcoin development in the past.
Dr. Craig Wright is known as “fake Satoshi” after claiming to be Satoshi Nakamoto but failing to prove it. He is a computer programmer and businessman. He tried to pass off a fraudulent signature, in public, and failed. His “proof” that he is S.N. was proven to be fake and an attempt to dupe people into believing his claim.
Jihan Wu is the proprietor of Bitmain, a large mining operator and mining equipment seller from China that controls almost all the hashrate of Bitcoin cash. Known for his patented ASICBOOST, a hidden mining software discovered by the community that gives them an unfair advantage over other miners. Segwit, Bitcoin Core’s upgrade, nullified this, hence the hatred for Bitcoin core.
Yes, these are the most notable people behind Bitcoin Cash.
Bitcoin VS Bcash Mining and Nodes: Know your network
Bitcoin Mining has become more distributed and more powerful in the last five years. The funny thing about this is that the biggest supporters of Bitcoin Cash (Antpool, others) are still mining Bitcoin, because it is simply more profitable. Bitcoin Core also has more than 7,800 active full nodes running which is one of the most important factors to be truly decentralized currency. These are real nodes, not run on AWS and paid for by one company.
Bitcoin Cash mining is highly centralized. Just check out the image above. If we combine the hash power of Antpool, ViaBTC, and BTC.com (Roger Ver and Jihan Wu’s mining pools) which makes more than 50% hash power. These two people can do a 51% attack anytime they want. Bitcoin Cash also has only 1,200 nodes, with a lot of them running on AWS and bought by the main proponents of Bitcoin cash.
Well, we now have some very basic knowledge of the two versions of the protocol, a closer look at the development team which is without a doubt most important part of any software project, an overview of the main personalities supporting each side, and an objective look at the network health in terms of hashrate and node count. If you wish to go down deeper into this rabbit hole, I wish you luck. This was a bit exhausting to write.
Supporting the Bitcoin network should be about the merits of the software and the open and decentralized nature of the project. This is a massive undertaking the likes of which the world has never seen before — it aims to replace the old way of using and moving money itself. Inevitably, attacks will happen as people resist this change. Thankfully, Bitcoin is Anti-fragile. I believe it will come out stronger.
My personal view is that all of these things happening in the crypto world will be part of of a much bigger story in the history of the evolution of money. Years from now, we will look back and probably laugh at this, seeing that all this in-fighting was a big waste of time and will attribute it to growing pains.
The real mission remains: a world where value flows as freely as information, and the evolution of money itself rapidly accelerates in the wake of the most disruptive technology ever seen by society — Bitcoin, Cyrptocurrency, and Blockchain Technology.
Whatever happens after this whole debacle is over, only one thing seems certain — The technology is here to stay and here to break the status quo.
- All views and opinions in this piece are my own.*