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You're right about the technical distinction, but I think you're incorrect that Bitcoin is truly final. Bitcoin may not have reversed a transaction yet, but it'

You're right about the technical distinction, but I think you're incorrect that Bitcoin is truly final. Bitcoin may not have reversed a transaction yet, but it's technically feasible. Note that Ethereum did it: https://futurism.com/the-dao-heist-undone-97-of-eth-holders-vote-for-the-hard-fork https://futurism.com/the-dao-heist-undone-97-of-eth-holders-... Bitcoin mining is very concentrated, so if one or more of the major miners is robbed, it's entirely plausible that similarly situated entities would collaborate and just undo the transaction.

beaned 5y ago
Is it that concentrated? People used to criticize that it was concentrated in China, and then that changed basically overnight when mining was shut down the. Now people still say this but how much is it true?
opportune 5y ago
But as the article notes this was actually a hard fork off the chain known up to that time at Ethereum. It’s really just semantics that the old chain became known as Ethereum Classic and the hard-forked chain maintained the name of “Ethereum” due to the active developers and most of the community choosing to use the hard fork. The payment was still never actually reversed on Ethereum Classic. And that blockchain exists to this day. Sure, the amount of the not-actually-reversed transaction has lost value in $ at mark-to-market but it’s still the same amount of ether on the same blockchain as it’s always been. In that sense a better term is that the payment was rejected by the community, or routed around, rather than reversed IMO.
- mLuby 5y ago
  That Ethereum Classic never reversed is true but largely meaningless; what matters, as you say, is that "the not-actually-reversed transaction has lost value in $ at mark-to-market." That loss in value represents the reversal. If that hadn't happened, the original and fork could be double-spent.
  - opportune 5y ago
    The difference in value of ETH classic and ETH grew over time though. It hasn’t always been so stark. I don’t care enough about the specifics of the “bad” txs to check when/if the funds were sent out of the receiving wallets but they might have recovered the same or similar amount of value in $. Anyway, I just find this a really bad example in general because it’s 1 an exceptional case, most other hard forks haven’t been done just for transactions 2 it required almost the entire community to choose to follow the hard fork (which is the only thing that actually destroys value). Yes, it does show that you can do something like a payment reversal in crypto but it’s very hard and unlikely. In this case the exception proves the rule
yanmaani 5y ago
I don't think it's possible to draw any conclusions about what would happen to Bitcoin, you're running into the fundamental limits of the problem of induction here. In particular, Bitcoin mining is concentrated into a small number of pools, but the amount of actual power they hold is very questionable. Because nobody censors transactions, we can't know if miners would flee or not if they began to. English banknotes are printed by De La Rue plc, but it's not like they have a stranglehold on the English economy. If they began to act up, their 'power' would dry up very quickly. Also, even with 100% of miners cooperating, reversing a two week old transaction would still take two weeks. There are some technical issues with this, since new transaction would grind to a halt and it would generally be a mess. Note how Ethereum wasn't miners collaborating (soft fork), it was a hard fork, which required no miner cooperation at all. A hard fork of Bitcoin in this way is indeed possible, but would require the consent of a lot of entities. Ethereum is much more 'socially' centralized in terms of its governance process, and it was very obvious that if they didn't go along with it, then the big, centralized entity that held all the proceeds from the ICO would stop paying the developers, and the PR goons, and and and... I'm not going to draw any conclusions about the future based on this, but we can observe that big players (Binance) have lost money, publicly considered 51% attacks, then backed down. We can also observe the fate of Marathon's OFAC pool - he didn't fly so good, who wants to try next?
- wpietri 5y ago
  I didn't make any claims about what would happen. Just that patio11 is correct that no transaction is truly final, because a Bitcoin transaction reversal is unlikely but not impossible.
deleted 5y ago
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olalonde 5y ago
Actually the transaction wasn't reversed, a distinct cryptocurrency was created (a "fork") which reversed the transaction. The new cryptocurrency adopted the name Ethereum and it became way more popular than the original, so the original had to rebrand to "Ethereum Classic" to avoid confusion. The new cryptocurrency was successful largely thanks to Ethereum founder Vitalik Buterin endorsing it. Similar "attacks" were attempted on Bitcoin multiple times (e.g. Bitcoin Cash) but they never quite succeeded and are unlikely to succeed thanks to Bitcoin lacking some sort of active founder/leader. For a Bitcoin hard fork to succeed, there would need to be a large consensus not only among miners, but among users, merchants, exchanges, etc.
- wpietri 5y ago
  So it sounds like we agree: It's unlikely but impossible, and so patio11 is correct to say that finality does not exist, and that it's just a probability distribution for each channel.
  - olalonde 5y ago
    I disagree that the Ethereum fork confirms the idea that the transaction wasn't final. It was final and still is. That being said, I do think patio11 is technically correct, given his unconventionally strict definition of "finality". Probability is at the core of Bitcoin's proof of work security mechanism. There is a non zero probability that I could rewrite the whole Bitcoin transaction history in the next 15 minutes, if my miner gets really, really, really lucky. The chances of that happening are of course abysmally small and not worth considering. For all practical purposes, Bitcoin transactions are final past a few confirmations.
    - wpietri 5y ago
      I think you are using a very technical definition of "final". Both the purpose and the real-world effect of the fork was to make an apparently final transaction no longer final. That it is still "final" in at best a distraction to the general-audience meaning of "final". I estimate the probability of a similar Bitcoin action to be small, but much larger than the "miner gets really, really, really lucky" scenario you propose. Do you disagree?
kayamon 5y ago
Transactions have already been reversed on Bitcoin via successful hard-forks: https://bitcointalk.org/index.php?topic=823.0 https://bitcointalk.org/index.php?topic=823.0
- yanmaani 5y ago
  That's not a hard fork. A hard fork makes a previously invalid transaction valid; this made a previously valid transaction invalid, e.g. a soft fork. Bitcoin has had many soft forks.

beaned 5y ago

Is it that concentrated? People used to criticize that it was concentrated in China, and then that changed basically overnight when mining was shut down the. Now people still say this but how much is it true?

opportune 5y ago

But as the article notes this was actually a hard fork off the chain known up to that time at Ethereum. It’s really just semantics that the old chain became known as Ethereum Classic and the hard-forked chain maintained the name of “Ethereum” due to the active developers and most of the community choosing to use the hard fork. The payment was still never actually reversed on Ethereum Classic. And that blockchain exists to this day. Sure, the amount of the not-actually-reversed transaction has lost value in $ at mark-to-market but it’s still the same amount of ether on the same blockchain as it’s always been. In that sense a better term is that the payment was rejected by the community, or routed around, rather than reversed IMO.

mLuby 5y ago
That Ethereum Classic never reversed is true but largely meaningless; what matters, as you say, is that "the not-actually-reversed transaction has lost value in $ at mark-to-market." That loss in value represents the reversal. If that hadn't happened, the original and fork could be double-spent.
- opportune 5y ago
  The difference in value of ETH classic and ETH grew over time though. It hasn’t always been so stark. I don’t care enough about the specifics of the “bad” txs to check when/if the funds were sent out of the receiving wallets but they might have recovered the same or similar amount of value in $. Anyway, I just find this a really bad example in general because it’s 1 an exceptional case, most other hard forks haven’t been done just for transactions 2 it required almost the entire community to choose to follow the hard fork (which is the only thing that actually destroys value). Yes, it does show that you can do something like a payment reversal in crypto but it’s very hard and unlikely. In this case the exception proves the rule

yanmaani 5y ago

I don't think it's possible to draw any conclusions about what would happen to Bitcoin, you're running into the fundamental limits of the problem of induction here. In particular, Bitcoin mining is concentrated into a small number of pools, but the amount of actual power they hold is very questionable. Because nobody censors transactions, we can't know if miners would flee or not if they began to. English banknotes are printed by De La Rue plc, but it's not like they have a stranglehold on the English economy. If they began to act up, their 'power' would dry up very quickly. Also, even with 100% of miners cooperating, reversing a two week old transaction would still take two weeks. There are some technical issues with this, since new transaction would grind to a halt and it would generally be a mess. Note how Ethereum wasn't miners collaborating (soft fork), it was a hard fork, which required no miner cooperation at all. A hard fork of Bitcoin in this way is indeed possible, but would require the consent of a lot of entities. Ethereum is much more 'socially' centralized in terms of its governance process, and it was very obvious that if they didn't go along with it, then the big, centralized entity that held all the proceeds from the ICO would stop paying the developers, and the PR goons, and and and... I'm not going to draw any conclusions about the future based on this, but we can observe that big players (Binance) have lost money, publicly considered 51% attacks, then backed down. We can also observe the fate of Marathon's OFAC pool - he didn't fly so good, who wants to try next?

wpietri 5y ago
I didn't make any claims about what would happen. Just that patio11 is correct that no transaction is truly final, because a Bitcoin transaction reversal is unlikely but not impossible.

deleted 5y ago

[deleted]

olalonde 5y ago

Actually the transaction wasn't reversed, a distinct cryptocurrency was created (a "fork") which reversed the transaction. The new cryptocurrency adopted the name Ethereum and it became way more popular than the original, so the original had to rebrand to "Ethereum Classic" to avoid confusion. The new cryptocurrency was successful largely thanks to Ethereum founder Vitalik Buterin endorsing it. Similar "attacks" were attempted on Bitcoin multiple times (e.g. Bitcoin Cash) but they never quite succeeded and are unlikely to succeed thanks to Bitcoin lacking some sort of active founder/leader. For a Bitcoin hard fork to succeed, there would need to be a large consensus not only among miners, but among users, merchants, exchanges, etc.

wpietri 5y ago
So it sounds like we agree: It's unlikely but impossible, and so patio11 is correct to say that finality does not exist, and that it's just a probability distribution for each channel.
- olalonde 5y ago
  I disagree that the Ethereum fork confirms the idea that the transaction wasn't final. It was final and still is. That being said, I do think patio11 is technically correct, given his unconventionally strict definition of "finality". Probability is at the core of Bitcoin's proof of work security mechanism. There is a non zero probability that I could rewrite the whole Bitcoin transaction history in the next 15 minutes, if my miner gets really, really, really lucky. The chances of that happening are of course abysmally small and not worth considering. For all practical purposes, Bitcoin transactions are final past a few confirmations.
  - wpietri 5y ago
    I think you are using a very technical definition of "final". Both the purpose and the real-world effect of the fork was to make an apparently final transaction no longer final. That it is still "final" in at best a distraction to the general-audience meaning of "final". I estimate the probability of a similar Bitcoin action to be small, but much larger than the "miner gets really, really, really lucky" scenario you propose. Do you disagree?

kayamon 5y ago

Transactions have already been reversed on Bitcoin via successful hard-forks: https://bitcointalk.org/index.php?topic=823.0 https://bitcointalk.org/index.php?topic=823.0

yanmaani 5y ago
That's not a hard fork. A hard fork makes a previously invalid transaction valid; this made a previously valid transaction invalid, e.g. a soft fork. Bitcoin has had many soft forks.