8 ms·

Bitcoin Is Likely to Split Again in November, Say Major Players

49 points by SirLJ 9y ago

ceejayoz 9y ago
This is why you don't negotiate with terrorists, Coinbase.
- hellbanner 9y ago
  Can you explain what you mean?
  - ceejayoz 9y ago
    Coinbase initially stated they weren't going to implement support for Bitcoin Cash, then backpedaled when enough people complained. https://blog.coinbase.com/update-on-bitcoin-cash-8a67a7e8dbdf https://blog.coinbase.com/update-on-bitcoin-cash-8a67a7e8dbd... As both Bitcoin and Bitcoin Cash have done well post-fork, there's a serious incentive for more forks, and forks of other coin types... and Coinbase's compromising makes it much less tenable to say "no" next time.
  - firethief 9y ago
    I think they initially were going to ignore the alt-coin but ceded to complaints and distributed the child currency. It could be argued to set a poor precedent, but seems safer for them legally; I don't think exchanges had predicted altcoins initialized to Bitcoin balances when writing their T&C.
- paulpauper 9y ago
  As the folks on reddit's bitcoin forum say, don't keep your coins on an exchange unless you use them for trading purposes
dogruck 9y ago
It will keep splitting as long as each split magically multiplies the notional value.
- brentis 9y ago
  In layman’s terms?
  - empath75 9y ago
    Every time there’s a split, everyone who had coins on one fork has the same number of coins on the other fork for free.
    - deleted 9y ago
      [deleted]
  - moufestaphio 9y ago
    I think what he means is, when bitcoin / cash split, everyone 'doubled' their coins. Since they share the same previous blockchain, after they 'split' in effect you have two coins for every one coin you had before the split. You can spend your Bitcoin cash, while you still own the same coin in Bitcoin.
  - raesene6 9y ago
    In the last split people who held bitcoins got an equal quantity of "Bitcoin cash", so if you had 1 BTC, after the split you had 1 BTC and 1 BCH. Looking at https://coinmarketcap.com/ https://coinmarketcap.com/ you can see that each BCH is worth ~$500 (at the time of this comment) and the value of BTC is higher after the split. so in essence $8,154,513,572 of new value was created from nothing with the split. If the next split follow the same pattern, more money appears...
    - lost_name 9y ago
      It's interesting to say that $8B of new value was created, since no one could supply that money if anyone asked for it. How did the cryptocurrency markets handle that, anyway?
empath75 9y ago
The more forks there are, the more laughable the idea that bitcoin is a deflationary currency.
- shp0ngle 9y ago
  But the one and only True Bitcoin is still deflationary. Your opinion on which is the True Bitcoin might vary. It's one of them though.
  - tboyd47 9y ago
    This. Bitcoin Cash isn't intended as a complement to Bitcoin, but its replacement. Either one of them wins or they all lose.
redshark1802 9y ago
bitcoin probably won't split again. Supporters of the initial proposal that would lead to the split are already withdrawing from this commitment. https://bitcoinmagazine.com/articles/no2x-breaking-bitcoin-shows-no-love-segwit2x-hard-fork-paris/ https://bitcoinmagazine.com/articles/no2x-breaking-bitcoin-s...
andrewla 9y ago
This split is fundamentally different because of the lack of replay protection. On the other hand, it is more consensus-driven. At this point, if the hashing power that is signaling Segwit2x follows the fork, and no replay protection is provided (and no "emergency difficulty adjustment", a la Bitcoin Cash), then we have 93% of the power following the fork, and only 7% staying behind. That means that block times will decrease 14-fold, and it will be 200 days until the next difficulty adjustment. Since there's no replay protection, there's no effective way to isolate "segwit2x" bitcoins from the non-"segwit2x" bitcoins, so it seems infeasible to trade them separately and let pricing data drive the mining decisions. This split is much more likely to either go very smoothly -- old chain completely abandoned, segwit2x is now bitcoin, or very disasterously -- becomes impossible to spend either bitcoins of sw2x-bitcoins because of the chain overlap until the coinbase transactions start to mature.
- runeks 9y ago
  […] or very disasterously -- becomes impossible to spend either bitcoins of sw2x-bitcoins because of the chain overlap until the coinbase transactions start to mature. Can you elaborate?
  - andrewla 9y ago
    The problem with a lack of replay protection (and this played out for a bit after the ETH/ETC split) is that transactions that are valid on one chain are valid on the other. For convenience, let's call the chains BTC and SBT (for segwit2 bitcoin). If I hold 10 BTC before the split, then I hold 10 BTC and 10 SBT after the split. If I want to send 5 BTC to an address post-split, but hold on to my 5 SBT, there's no way to do it. The transaction that sends 5 BTC can be "replayed" onto the SBT fork, so the same address on the SBT side also receives my 5 SBT. In the ETC/ETH split this was resolved by having a contract which split coins into two addresses, depending on what side of the chain the contract was on; so you would make a ETCETH deposit to this address and specify two output addresses; one would receive the ETC and the other the ETH. This is not possible in Bitcoin; the language is not powerful enough. So to split your coins, you would need to get conflicting transactions accepted by the two chains, and wait for that to settle. Once that's done, you can move the remainder of your addresses by sending from the SBT address along with a BTCSBT address, and sending from the BTC address along with a BTCSBT address. This is pretty hairy for an individual user, and would probably have to be mediated by a service (most likely operated by an exchange).
Sargos 9y ago
I know Bitcoin is still in development but if things like this keep happening then it will never make it as a legitimate source of money. It's reputation is already in the dumps and these splits just make it worse and worse.
- deleted 9y ago
  [deleted]
- tboyd47 9y ago
  How's that? Bitcoin's hard forks just tend to fizzle out into nothing. Ethereum's chain has been switched out with via hard fork several times already and people still love it.
  - Sargos 9y ago
    When you refer to people in your comment it mostly likely means the Bitcoin enthusiasts and not a normal person looking at it from the perspective that it's a currency. It's volatile and has seemingly no leadership with realistic goals. People aren't going to take it seriously until it matures in multiple ways. But like I said it's still experimental so maybe the kinks will get worked out in a few years and it will become viable, but it has a long way to go and it's not moving very fast.
    - tboyd47 9y ago
      > volatile and has seemingly no leadership with realistic goals I'd argue that the perceived utility of Bitcoin as a currency depends a lot on the alternatives available to you. There's no way to measure Bitcoin adoption by country but Google trends gives an interesting picture: https://trends.google.com/trends/explore?q=Bitcoin https://trends.google.com/trends/explore?q=Bitcoin
  - zwily 9y ago
    ... with the exception of Bitcoin Cash. It seems to be doing okay.
marenkay 9y ago
Isn't it obvious that it has to split a few more times? Unless it does it's major investors would not be able to cash out. The way I see it, Bitcoin works exactly like a classic pyramid schema. Only interesting part of value IMHO is the Blockchain technology itself.
paulpauper 9y ago
So does this mean more 'free money' for Bitcoin holders. yay
runeks 9y ago
What’s the argument against increasing the block size limit to 2MB, from those who oppose this? I was under the impression that the original SegWit proposal increased the block size limit anyway — albeit through a change in how it’s calculated, but still.
- alanfalcon 9y ago
  I asked this several times on r/bitcoin and just got links to a Core blog post warning, “this isn’t something Core supports,” and (essentially) “hard forks are confusing for users.” So if you blindly follow Core devs, then apparently that’s enough “technical” reason for you. [It seems to me that Core wants to keep small blocks so that fees on the primary chain continue to rise and everyone is forced to use the side chains that they are building and stand to profit handsomely from. They don’t want people being able to use the main chain for small purchases because it increases the size of the blockchain, which makes it more expensive to run nodes, but realistically they’re simply making Bitcoin too expensive to use at all.] Anyway, I’m curious if your question can produce some more reasonable answers here.
  - lawlessone 9y ago
    They're right about confusions, bitcoin cash is simple enough to understand if you've been in this for a while but it's very confusing sometimes. Some people think they're buying one when it's the other. Others have lost money trying to set bitcoin from one branch to another. These is also an argument that making the blocks bigger wont actually make a difference. https://en.wikipedia.org/wiki/Jevons_paradox https://en.wikipedia.org/wiki/Jevons_paradox Sidechains will happen regardless.
- tboyd47 9y ago
  I understand that many of the Core developers oppose a block size increase because it would make it more costly to run a full node. Right now a full node can be run on practically any computer. I got a pruned node running in less than a month this year using some 10-year-old hardware I had sitting in my basement. At this point, though, I see it as little more than a highly politicized flame war. Years of having the same arguments tend to make people grow bitter. The interesting thing (to me) is how little this debate seems to affect the price and adoption of Bitcoin.

49 points by SirLJ 9y ago

ceejayoz 9y ago

This is why you don't negotiate with terrorists, Coinbase.

hellbanner 9y ago
Can you explain what you mean?
- ceejayoz 9y ago
  Coinbase initially stated they weren't going to implement support for Bitcoin Cash, then backpedaled when enough people complained. https://blog.coinbase.com/update-on-bitcoin-cash-8a67a7e8dbdf https://blog.coinbase.com/update-on-bitcoin-cash-8a67a7e8dbd... As both Bitcoin and Bitcoin Cash have done well post-fork, there's a serious incentive for more forks, and forks of other coin types... and Coinbase's compromising makes it much less tenable to say "no" next time.
- firethief 9y ago
  I think they initially were going to ignore the alt-coin but ceded to complaints and distributed the child currency. It could be argued to set a poor precedent, but seems safer for them legally; I don't think exchanges had predicted altcoins initialized to Bitcoin balances when writing their T&C.
paulpauper 9y ago
As the folks on reddit's bitcoin forum say, don't keep your coins on an exchange unless you use them for trading purposes

dogruck 9y ago

It will keep splitting as long as each split magically multiplies the notional value.

brentis 9y ago
In layman’s terms?
- empath75 9y ago
  Every time there’s a split, everyone who had coins on one fork has the same number of coins on the other fork for free.
  - deleted 9y ago
    [deleted]
- moufestaphio 9y ago
  I think what he means is, when bitcoin / cash split, everyone 'doubled' their coins. Since they share the same previous blockchain, after they 'split' in effect you have two coins for every one coin you had before the split. You can spend your Bitcoin cash, while you still own the same coin in Bitcoin.
- raesene6 9y ago
  In the last split people who held bitcoins got an equal quantity of "Bitcoin cash", so if you had 1 BTC, after the split you had 1 BTC and 1 BCH. Looking at https://coinmarketcap.com/ https://coinmarketcap.com/ you can see that each BCH is worth ~$500 (at the time of this comment) and the value of BTC is higher after the split. so in essence $8,154,513,572 of new value was created from nothing with the split. If the next split follow the same pattern, more money appears...
  - lost_name 9y ago
    It's interesting to say that $8B of new value was created, since no one could supply that money if anyone asked for it. How did the cryptocurrency markets handle that, anyway?

empath75 9y ago

The more forks there are, the more laughable the idea that bitcoin is a deflationary currency.

shp0ngle 9y ago
But the one and only True Bitcoin is still deflationary. Your opinion on which is the True Bitcoin might vary. It's one of them though.
- tboyd47 9y ago
  This. Bitcoin Cash isn't intended as a complement to Bitcoin, but its replacement. Either one of them wins or they all lose.

redshark1802 9y ago

bitcoin probably won't split again. Supporters of the initial proposal that would lead to the split are already withdrawing from this commitment. https://bitcoinmagazine.com/articles/no2x-breaking-bitcoin-shows-no-love-segwit2x-hard-fork-paris/ https://bitcoinmagazine.com/articles/no2x-breaking-bitcoin-s...

andrewla 9y ago

This split is fundamentally different because of the lack of replay protection. On the other hand, it is more consensus-driven. At this point, if the hashing power that is signaling Segwit2x follows the fork, and no replay protection is provided (and no "emergency difficulty adjustment", a la Bitcoin Cash), then we have 93% of the power following the fork, and only 7% staying behind. That means that block times will decrease 14-fold, and it will be 200 days until the next difficulty adjustment. Since there's no replay protection, there's no effective way to isolate "segwit2x" bitcoins from the non-"segwit2x" bitcoins, so it seems infeasible to trade them separately and let pricing data drive the mining decisions. This split is much more likely to either go very smoothly -- old chain completely abandoned, segwit2x is now bitcoin, or very disasterously -- becomes impossible to spend either bitcoins of sw2x-bitcoins because of the chain overlap until the coinbase transactions start to mature.

runeks 9y ago
[…] or very disasterously -- becomes impossible to spend either bitcoins of sw2x-bitcoins because of the chain overlap until the coinbase transactions start to mature. Can you elaborate?
- andrewla 9y ago
  The problem with a lack of replay protection (and this played out for a bit after the ETH/ETC split) is that transactions that are valid on one chain are valid on the other. For convenience, let's call the chains BTC and SBT (for segwit2 bitcoin). If I hold 10 BTC before the split, then I hold 10 BTC and 10 SBT after the split. If I want to send 5 BTC to an address post-split, but hold on to my 5 SBT, there's no way to do it. The transaction that sends 5 BTC can be "replayed" onto the SBT fork, so the same address on the SBT side also receives my 5 SBT. In the ETC/ETH split this was resolved by having a contract which split coins into two addresses, depending on what side of the chain the contract was on; so you would make a ETCETH deposit to this address and specify two output addresses; one would receive the ETC and the other the ETH. This is not possible in Bitcoin; the language is not powerful enough. So to split your coins, you would need to get conflicting transactions accepted by the two chains, and wait for that to settle. Once that's done, you can move the remainder of your addresses by sending from the SBT address along with a BTCSBT address, and sending from the BTC address along with a BTCSBT address. This is pretty hairy for an individual user, and would probably have to be mediated by a service (most likely operated by an exchange).

Sargos 9y ago

I know Bitcoin is still in development but if things like this keep happening then it will never make it as a legitimate source of money. It's reputation is already in the dumps and these splits just make it worse and worse.

deleted 9y ago
[deleted]
tboyd47 9y ago
How's that? Bitcoin's hard forks just tend to fizzle out into nothing. Ethereum's chain has been switched out with via hard fork several times already and people still love it.
- Sargos 9y ago
  When you refer to people in your comment it mostly likely means the Bitcoin enthusiasts and not a normal person looking at it from the perspective that it's a currency. It's volatile and has seemingly no leadership with realistic goals. People aren't going to take it seriously until it matures in multiple ways. But like I said it's still experimental so maybe the kinks will get worked out in a few years and it will become viable, but it has a long way to go and it's not moving very fast.
  - tboyd47 9y ago
    > volatile and has seemingly no leadership with realistic goals I'd argue that the perceived utility of Bitcoin as a currency depends a lot on the alternatives available to you. There's no way to measure Bitcoin adoption by country but Google trends gives an interesting picture: https://trends.google.com/trends/explore?q=Bitcoin https://trends.google.com/trends/explore?q=Bitcoin
- zwily 9y ago
  ... with the exception of Bitcoin Cash. It seems to be doing okay.

marenkay 9y ago

Isn't it obvious that it has to split a few more times? Unless it does it's major investors would not be able to cash out. The way I see it, Bitcoin works exactly like a classic pyramid schema. Only interesting part of value IMHO is the Blockchain technology itself.

paulpauper 9y ago

So does this mean more 'free money' for Bitcoin holders. yay

runeks 9y ago

What’s the argument against increasing the block size limit to 2MB, from those who oppose this? I was under the impression that the original SegWit proposal increased the block size limit anyway — albeit through a change in how it’s calculated, but still.

alanfalcon 9y ago
I asked this several times on r/bitcoin and just got links to a Core blog post warning, “this isn’t something Core supports,” and (essentially) “hard forks are confusing for users.” So if you blindly follow Core devs, then apparently that’s enough “technical” reason for you. [It seems to me that Core wants to keep small blocks so that fees on the primary chain continue to rise and everyone is forced to use the side chains that they are building and stand to profit handsomely from. They don’t want people being able to use the main chain for small purchases because it increases the size of the blockchain, which makes it more expensive to run nodes, but realistically they’re simply making Bitcoin too expensive to use at all.] Anyway, I’m curious if your question can produce some more reasonable answers here.
- lawlessone 9y ago
  They're right about confusions, bitcoin cash is simple enough to understand if you've been in this for a while but it's very confusing sometimes. Some people think they're buying one when it's the other. Others have lost money trying to set bitcoin from one branch to another. These is also an argument that making the blocks bigger wont actually make a difference. https://en.wikipedia.org/wiki/Jevons_paradox https://en.wikipedia.org/wiki/Jevons_paradox Sidechains will happen regardless.
tboyd47 9y ago
I understand that many of the Core developers oppose a block size increase because it would make it more costly to run a full node. Right now a full node can be run on practically any computer. I got a pruned node running in less than a month this year using some 10-year-old hardware I had sitting in my basement. At this point, though, I see it as little more than a highly politicized flame war. Years of having the same arguments tend to make people grow bitter. The interesting thing (to me) is how little this debate seems to affect the price and adoption of Bitcoin.