5 ms·

Miners can mine segwit2x blocks all they wish, but since services/exchanges are running core client, they are just mining invalid blocks from their viewpoint, a

Miners can mine segwit2x blocks all they wish, but since services/exchanges are running core client, they are just mining invalid blocks from their viewpoint, and those blocks are ignored. That means miners can't sell their mined segwit2x bitcoins on exchanges. Mining blocks that services don't accept would be very, very stupid, essentially throwing good money to trash.

buttershakes 9y ago
So if a huge number of nodes are Segwit2x capable, and the miners are mining Segwit2x blocks with the majority of the hash power, companies are going to stay on a less secure chain that can be attacked by the majority so that they can have a smaller block size and keep the core dev team because they love them? This isn't how that works. Proof-of-work will force those companies onto the dominant chain. Exchanges will probably keep trading the smaller coins also.
- jerguismi 9y ago
  Bitcoin protocol is defined by bitcoin core client, and I would guess more than 99% percent of the services that process bitcoin transactions use that client. The services don't follow actively the hash rate and they won't change the client based on that - the network automatically adjusts to the hash rate available so that blocks come each 10 minutes. If there would exist some other cryptocurrency with more hash rate doesn't mean that services would start calling that one bitcoin.
  - buttershakes 9y ago
    That's not what it means. You are right that those clients would begin rejecting blocks, but you can be sure that when customers are calling them asking why their transactions aren't being validated that they will switch. It's not economically feasible to run a business on a minority hash power chain with low transaction throughput.
    - jerguismi 9y ago
      "when customers are calling them asking why their transactions aren't being validated that they will switch." If majority of hashpower would start mining invalid blocks, there would still be some amount of hashpower mining the real chain. Transactions would confirm, albeit more slowly. For the miners mining the real chain the situation would be very good, because less competition from other miners -> more found blocks, more money. Probably the hash rate would grow pretty quickly, and if it wouldn't, the difficulty target would adjust after the 2 week difficulty adjustment period, and confirmation speeds would be back to normal.
      - buttershakes 9y ago
        The taking a little while to adapt is because their is less hash power, which means it takes longer to find blocks which means the remaining hash power will have less blocks for many many weeks. This means their expected return is lower, not higher, they aren't getting a larger percentage of found blocks, and those blocks occur farther apart. Then when the difficulty has fallen enough to make mining profitable and have a consistent 10 minute block time the larger hash power chain will be able to mine at a significantly faster rate on the lower hash power chain and that will make it susceptible to a %51 attack. The only way to avoid that scenario will be for them to switch the proof-of-work or manage to get a lot more hash power back on their chain. Being on the minority chain in that situation is frankly dangerous, the value should be discounted appropriately.
        jerguismi 9y ago
        "This means their expected return is lower, not higher, they aren't getting a larger percentage of found blocks, and those blocks occur farther apart." The blocks would happen farther apart, but it would also mean that the remaining miners would have much higher change of actually finding a block, since there would be less competition. Also as there would be the same amount of transactions and less blocks, the blocks would have more collected transaction fees -> bigger reward. Also probably people/exchanges would increase the fees since competition would be bigger to get the transaction to a block. Also, it would make sense for exchanges etc to buy some mining power. That would make blocks appear faster, and also they would get the mining reweards, so it might be net positive. Or just simply bribe some miners to mine the valid chain. Very easy way to do that would be just to increase the transaction fees that they put to transactions.
- polyomino 9y ago
  Depends what you mean by secure. If users cannot validate the blocks, then no matter how much hashpower is available, it is vulnerable to miner attack.
- deleted 9y ago
  [deleted]
- jerguismi 9y ago
  If miners would do a hard fork with different protocol rules, that would be called something other than bitcoin, maybe "segwit2x-bitcoin" or something.
  - kbaker 9y ago
    If the exchanges trade 'segwit2x-coin' as Bitcoin, it will become 'Bitcoin', and the legacy coin, if it is possible to use at all, will have to be renamed.
    - xorcist 9y ago
      It's not that simple. Exchanges and custodial wallets hold other people's funds, so they are not allowed to decide arbitrarily which chain is "Bitcoin". That would be regulatory suicide.
grey-area 9y ago
If your thesis holds, it invalidates the central tenet of a decentralised network. If a central party can set the rules, why not use the much better centralised transaction systems and forgo things like POW?
wmf 9y ago
AFAIK btc1 produces normal segwit blocks that will be accepted by Core; that's the point of the compromise.
- kbaker 9y ago
  Until the hard fork 3 months down the road, then the blocks won't be accepted.
stale2002 9y ago
If the legacy chain has too little hashpower then it can be easily attacked.
xg15 9y ago
Maybe I'm misinformed, but aren't SegWit (without 2x) blocks backwards compatible? From what I understood, a valid SegWit block will appear valid to an old client. Certain invalid SegWit blocks will also appear valid to old clients, but those blocks will be rejected by SegWit-enabled miners, so they have little chance to be included should the miners change.
- flashdance 9y ago
  > Maybe I'm misinformed, but aren't SegWit (without 2x) blocks backwards compatible? You're correct. However, I'm fairly sure OP was talking about Segwit (with 2x). If most users/exchanges/services don't get on board by the time the scheduled segwit2x hardfork happens, then those blocks would be considered invalid.
  - xg15 9y ago
    That makes sense. However from what I've read, the timeline is "SegWit -> multi-month transition period -> 2x HF". So by the time the 2x fork comes up, the segwit-enabled chain will already be in use for several months. Another point I'm wondering (sorry if that's a noob question) : Assume that some of the forks actually lead to a chain split with hashpower distributed 90%/10%. At some point, the difficulty of the chains will adjust to bring both of them back to the "one block every 10 minutes" rate. However, this will not happen immediately but only when the current difficulty period would complete. Before that happens, the minority chain will still have the difficulty from before the split - the one that assumes 10x as much hash power as now is actually available. That sounds as if the minority chain could become effectively unminable for the rest of the difficulty period. Worse, as the period durations are measured in mined blocks, if blocks are mined slower, the difficulty period will also go on for a longer time. Does that make any sense?
    - flashdance 9y ago
      Super late response, but... > So by the time the 2x fork comes up, the segwit-enabled chain will already be in use for several months. Correct. But there's an asterisk here: most people (78%) are running bitcoin core, some run Core/UASF (5%), and some run bitcore (2%). Together, that's 85% of nodes. Core 0.14, Core/UASF, and bitcore are all compatible with segwit, but not with the blocksize increase. Even if you wait multiple months, if people stick with Core (a possible outcome) then they will see 2x blocks as invalid. > That sounds as if the minority chain could become effectively unminable for the rest of the difficulty period. The chain wouldn't be unmineable, it would just get mined slower (mining profitability wouldn't be impacted for miners staying on the chain provided the price stays the same). But you're right, blocks will come slower, throughput will be lower, and the adjustment will take longer.
flashmob 9y ago
Exchanges don't care about any particular coin. They only care about their users. If their customers demand trading of segwit2x then that's what what will happen. There could be a lot of opportunity for trading segwit2x because the volatility which is what traders like. Same goes for all other bitcoin forks, it's going to be a trading bonanza for the exchanges!
bitcoinbob 9y ago
Note however that several services/exchanges are part of the NYA (segwit2x supporters) too. That's one thing that makes this hard fork much different than previous attempts.

buttershakes 9y ago

So if a huge number of nodes are Segwit2x capable, and the miners are mining Segwit2x blocks with the majority of the hash power, companies are going to stay on a less secure chain that can be attacked by the majority so that they can have a smaller block size and keep the core dev team because they love them? This isn't how that works. Proof-of-work will force those companies onto the dominant chain. Exchanges will probably keep trading the smaller coins also.

jerguismi 9y ago
Bitcoin protocol is defined by bitcoin core client, and I would guess more than 99% percent of the services that process bitcoin transactions use that client. The services don't follow actively the hash rate and they won't change the client based on that - the network automatically adjusts to the hash rate available so that blocks come each 10 minutes. If there would exist some other cryptocurrency with more hash rate doesn't mean that services would start calling that one bitcoin.
- buttershakes 9y ago
  That's not what it means. You are right that those clients would begin rejecting blocks, but you can be sure that when customers are calling them asking why their transactions aren't being validated that they will switch. It's not economically feasible to run a business on a minority hash power chain with low transaction throughput.
  - jerguismi 9y ago
    "when customers are calling them asking why their transactions aren't being validated that they will switch." If majority of hashpower would start mining invalid blocks, there would still be some amount of hashpower mining the real chain. Transactions would confirm, albeit more slowly. For the miners mining the real chain the situation would be very good, because less competition from other miners -> more found blocks, more money. Probably the hash rate would grow pretty quickly, and if it wouldn't, the difficulty target would adjust after the 2 week difficulty adjustment period, and confirmation speeds would be back to normal.
    - buttershakes 9y ago
      The taking a little while to adapt is because their is less hash power, which means it takes longer to find blocks which means the remaining hash power will have less blocks for many many weeks. This means their expected return is lower, not higher, they aren't getting a larger percentage of found blocks, and those blocks occur farther apart. Then when the difficulty has fallen enough to make mining profitable and have a consistent 10 minute block time the larger hash power chain will be able to mine at a significantly faster rate on the lower hash power chain and that will make it susceptible to a %51 attack. The only way to avoid that scenario will be for them to switch the proof-of-work or manage to get a lot more hash power back on their chain. Being on the minority chain in that situation is frankly dangerous, the value should be discounted appropriately.
      - jerguismi 9y ago
        "This means their expected return is lower, not higher, they aren't getting a larger percentage of found blocks, and those blocks occur farther apart." The blocks would happen farther apart, but it would also mean that the remaining miners would have much higher change of actually finding a block, since there would be less competition. Also as there would be the same amount of transactions and less blocks, the blocks would have more collected transaction fees -> bigger reward. Also probably people/exchanges would increase the fees since competition would be bigger to get the transaction to a block. Also, it would make sense for exchanges etc to buy some mining power. That would make blocks appear faster, and also they would get the mining reweards, so it might be net positive. Or just simply bribe some miners to mine the valid chain. Very easy way to do that would be just to increase the transaction fees that they put to transactions.
polyomino 9y ago
Depends what you mean by secure. If users cannot validate the blocks, then no matter how much hashpower is available, it is vulnerable to miner attack.
deleted 9y ago
[deleted]
jerguismi 9y ago
If miners would do a hard fork with different protocol rules, that would be called something other than bitcoin, maybe "segwit2x-bitcoin" or something.
- kbaker 9y ago
  If the exchanges trade 'segwit2x-coin' as Bitcoin, it will become 'Bitcoin', and the legacy coin, if it is possible to use at all, will have to be renamed.
  - xorcist 9y ago
    It's not that simple. Exchanges and custodial wallets hold other people's funds, so they are not allowed to decide arbitrarily which chain is "Bitcoin". That would be regulatory suicide.

grey-area 9y ago

If your thesis holds, it invalidates the central tenet of a decentralised network. If a central party can set the rules, why not use the much better centralised transaction systems and forgo things like POW?

wmf 9y ago

AFAIK btc1 produces normal segwit blocks that will be accepted by Core; that's the point of the compromise.

kbaker 9y ago
Until the hard fork 3 months down the road, then the blocks won't be accepted.

stale2002 9y ago

If the legacy chain has too little hashpower then it can be easily attacked.

xg15 9y ago

Maybe I'm misinformed, but aren't SegWit (without 2x) blocks backwards compatible? From what I understood, a valid SegWit block will appear valid to an old client. Certain invalid SegWit blocks will also appear valid to old clients, but those blocks will be rejected by SegWit-enabled miners, so they have little chance to be included should the miners change.

flashdance 9y ago
> Maybe I'm misinformed, but aren't SegWit (without 2x) blocks backwards compatible? You're correct. However, I'm fairly sure OP was talking about Segwit (with 2x). If most users/exchanges/services don't get on board by the time the scheduled segwit2x hardfork happens, then those blocks would be considered invalid.
- xg15 9y ago
  That makes sense. However from what I've read, the timeline is "SegWit -> multi-month transition period -> 2x HF". So by the time the 2x fork comes up, the segwit-enabled chain will already be in use for several months. Another point I'm wondering (sorry if that's a noob question) : Assume that some of the forks actually lead to a chain split with hashpower distributed 90%/10%. At some point, the difficulty of the chains will adjust to bring both of them back to the "one block every 10 minutes" rate. However, this will not happen immediately but only when the current difficulty period would complete. Before that happens, the minority chain will still have the difficulty from before the split - the one that assumes 10x as much hash power as now is actually available. That sounds as if the minority chain could become effectively unminable for the rest of the difficulty period. Worse, as the period durations are measured in mined blocks, if blocks are mined slower, the difficulty period will also go on for a longer time. Does that make any sense?
  - flashdance 9y ago
    Super late response, but... > So by the time the 2x fork comes up, the segwit-enabled chain will already be in use for several months. Correct. But there's an asterisk here: most people (78%) are running bitcoin core, some run Core/UASF (5%), and some run bitcore (2%). Together, that's 85% of nodes. Core 0.14, Core/UASF, and bitcore are all compatible with segwit, but not with the blocksize increase. Even if you wait multiple months, if people stick with Core (a possible outcome) then they will see 2x blocks as invalid. > That sounds as if the minority chain could become effectively unminable for the rest of the difficulty period. The chain wouldn't be unmineable, it would just get mined slower (mining profitability wouldn't be impacted for miners staying on the chain provided the price stays the same). But you're right, blocks will come slower, throughput will be lower, and the adjustment will take longer.

flashmob 9y ago

Exchanges don't care about any particular coin. They only care about their users. If their customers demand trading of segwit2x then that's what what will happen. There could be a lot of opportunity for trading segwit2x because the volatility which is what traders like. Same goes for all other bitcoin forks, it's going to be a trading bonanza for the exchanges!

bitcoinbob 9y ago

Note however that several services/exchanges are part of the NYA (segwit2x supporters) too. That's one thing that makes this hard fork much different than previous attempts.