Bitcoin forks have been a hot news item and a contentious issue lately. Here’s what leaders in the digital currency industry have to say.
Once an obscure Bitcoin feature, talk of forks now dominates conversation in the community. From Bitcoin Cash to Bitcoin Gold to SegWit2x, forks have abounded lately. Cointelegraph has written about forks before, what they mean and their consequences. Now we’ve had the opportunity to talk to a number of other industry leaders about their perspectives. Here’s what we’ve learned.
Bad news for Bitcoin
Sol Lederer, Blockchain Director at LOOMIA, believes forks are harmful. He writes:
“These forks are very bad for Bitcoin. We are looking at a possible fork on Oct. 25 with Bitcoin Gold and another one next month for SegWit2x. Saturating the market with different versions of Bitcoin is confusing to users and discredits the claim that there are a limited number of Bitcoins–since you can always fork it and double the supply.”
Worse, Lederer believes the inability to reach consensus spells trouble down the line:
“What’s deeply troublesome is that these spin-offs sprung from a relatively minor squabble in the Bitcoin community on how to handle the blocksize limit. Instead of coming to an agreement, the community, developers and code are fracturing into different groups. We’re learning that while a Blockchain gives you consensus on a distributed ledger, it does not provide you consensus on the codebase, that is what code to run. This does not bode well for Bitcoin’s future, where it will face new and bigger challenges requiring further upgrades to the codebase.”
Abhishek Pitti, CEO and Founder of Nucleus, points to SegWit2x’s lack of replay protection as being potentially devastating. Replay protection keeps attackers from broadcasting the same transaction on two networks, thereby moving a user’s legacy coins and forked coins. Since SegWit2x considers itself the “true” Bitcoin, they are not implementing such protection.
“In the cryptocurrency world, forks are analogous to stock splits but involve complex underlying technologies. Bitcoin was built with the intent to serve as an open, trustless, independent and permission-less protocol, and the long-term success of Bitcoin depends on sustaining these characteristics. On Aug. 1, 2017, the SegWit soft fork was deployed, which was aimed at tackling the scalability of the Bitcoin protocol, and offered several core advantages. However, the upcoming SegWit2x hard fork presents a serious risk to the Bitcoin ecosystem due to its lack of backward compatibility or replay protection, with all major developers and exchanges refusing to support it.”
They’re going to happen, anyway
Rob Viglione, Co-Founder of ZenCash, believes that forks are messy but inevitable:
“Open-source ecosystems are designed to evolve, whether that’s through in-project improvements or forks in which the entire code base goes in an incompatible direction. Evolution is a messy process, so it doesn’t always turn out well, but sometimes that’s the only way to have big breakthroughs.”
Taulant Ramabaja, CTO of ULedger, believes forks are inevitable and that there will be more to come:
“We can expect many more Bitcoin forks such as these in the future. Ultimately the Bitcoin ecosystem has a triangle of three veto powers. 1) the Miners, 2) the Exchanges, 3) the Wallets (without key ownership). For any fork to become dominant in the future, a sufficiently large part of all three needs to jump ship. This is highly unlikely, and therefore Bitcoin favors the status quo.
That said, once Bitcoin Lightning based exchanges and wallets come online this picture can change drastically as the role of exchanges and wallets will change.”
Forks are a good thing
Bob Summerwill, Chief Blockchain Developer at Sweetbridge, believes that forks are generally a good thing because they let members of the community take control of their own destiny. He writes:
“There have been years of fear, uncertainty and doubt within the Bitcoin community about the ‘risk’ of hard forks. It is apparent to me that most of that noise has been coming from groups that favor coercion and censorship over free markets and the right to secede.
There is no such thing as a ‘bad fork.’ You don’t have to cheer one team or the other. Experimentation and competition are good. Let the market decide and participate where you see value.
My most valuable learning experience from the ETH/ETC split was that minority chains are viable. If a crypto community has irreconcilable differences, then you can go your separate ways, and that is just fine. You get a divorce and both move on with your lives, rather than living together in misery forever, constantly arguing.”
Luis Cuende, Co-Founder of Aragon, was clear about his belief that the recent Bitcoin Gold fork is not a promising solution:
“I like the end goal of decentralizing the currency as much as possible, but Bitcoin Gold doesn’t seem like a technically sound answer at all. At this moment in time, it doesn’t even have replay protection, which makes the fork absolutely reckless and extremely unsafe for all Bitcoin users.”
Death and taxes
Ben Franklin famously said that nothing is certain in life but death and taxes. When it comes to Blockchain, we can add a third item to that list: forks. As Bitcoin marches toward mainstream adoption and as other digital currencies begin to spread their wings as well, it’s inevitable that the large, decentralized communities backing these currencies are going to have disagreements. These disagreements will sometimes lead to splits.
During World War II, the British Ministry of Information encouraged Britons to “keep calm and carry on.” Perhaps this is good advice to us digital currency enthusiasts as well. Maybe it’s best if we just ignore the naysayers, pick our preferred currency (or fork) and go about our business.
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Author: David Dinkins