The story of several hard forks: how did the bitcoin network evolve
Bitcoin hardfork (SegWit2x) was to be held in mid-November, but the leaders of the companies leading the initiative decided to abandon this idea. As stated in their appeal, the implementation of hardfork without the consent of the community would lead to a split of mining capacities and, as a result, the emergence of competing blockchains.
Hardfork is the division of cryptocurrency into two chains by changing the processing rules and adding blocks. After hardforka, one branch works with nodes that support the new rules, and the second with nodes that refuse to support changes.
Since the advent of Bitcoin, the blockchain has experienced many hard forks. Some of them have not gained popularity for one reason or another (lack of support, software bugs), such as Bitcoin Unlimited, Bitcoin Classic, Bitcoin XT.
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In today's material, we recall all the significant hard forks: who, when and for what purpose tried to "share" the bitcoin network.
/ image BTC Keychain CC
The history of Bitcoin began in 2008, when its creator Satoshi Nakamoto released a document, officially introducing a new cryptocurrency. In early 2009, he activated the network and generated the first block, the genesis block. He received a reward of 50 bitcoins. At that time, the protocol worked with a block size of 1 megabyte and processed a maximum of 7 transactions per second.
When the Bitcoin network began to grow, some of the restrictions began to cause inconvenience. For example, a megabyte block, although it was a defense mechanism against DDoS attacks, had a negative impact on network bandwidth. Therefore, people began to look for options for expanding the functionality of Bitcoin blockchain.
Bitcoin XT is the first fork in the history of bitcoin. Bitcoin XT client launched by Mike Hearn in December 2014. Mike implemented several new features, including his own BIP 64 ( Bitcoin Improvement Proposal ). BIP 64 is an extension for the P2P protocol that allows you to quickly view a list with unspent transaction outputs (UTXO) to protect the system from re-spending already “translated” bitcoins.
Also, the task of fork of Bitcoin XT was to increase the transaction processing speed up to 24 transactions per second by “expanding” the block to 8 MB. Therefore, at the start of the new protocol, it gained popularity in the community: in August 2015, four thousand nodes operated on the network.
But over time, Bitcoin XT has lost its popularity. He never managed to gain a critical mass of users - 75% - in order to become a “standard”. In part, this was due to the lack of safe implementation of certain functions. The project did not receive the support of China's largest mining pools, and industry expert Meni Rosenfield (Meni Rosenfeld) published a comment on Reddit, in which he said that XT is a reckless act that shatters a stable structure and can lead to a community split.
By early 2016, the project was almost dead. Bitcoin XT is still supported, but it is considered an extremely small cryptocurrency - there are less than 20 nodes on the network. For comparison, in the main Bitcoin network operates 11 thousand nodes.
Although Bitcoin XT failed, the community did not abandon the idea of ​​increasing block size and speeding up transactions. In February 2016, the development team conducted a new fork and created Bitcoin Classic. The source code for the project can be found on GitHub. He laid out the developer Gavin Andresen (Gavin Andresen).
The increase in the block in Bitcoin Classic was more modest, but still significant, up to 2 MB. However, eight months after launch, the creators changed policy, market participants began to determine the size of the block. Also, any user of the Bitcoin Classic network could influence the decisions about changes in the source code.
Fork received support from several major market players: Coinbase, Bitstamp, Circle, and Jeff Garzik, CEO of Bloq. However, immediately after the launch began to lose popularity.
Until recently, 100 nodes operated in the Bitcoin Classic network (compared to 2 thousand at the start), and on November 10 of this year, the developers announced that they would stop supporting the blockchain. Bitcoin Classic release manager Tom Zander (Tom Zander) wrote that all the ideas that Bitcoin Classic pursued now “promote” Bitcoin Cash (another bitcoin fork).
The Bitcoin Classic network participants were recommended to start using alternative wallets, because the work of the official client will be stopped in the coming weeks.
The stable release of Bitcoin Unlimited occurred in May 2016.
The idea of ​​the project is that each miner can independently choose the block size. If a large number of miners are working on large blocks, while others say that they are not opposed to join, the network automatically begins to generate larger blocks.
By removing the restrictions, the Unlimited developers wanted to give the market the opportunity to regularly vote for the ideal block size. This should have resolved the block size dispute forever.
Bitcoin Unlimited cryptocurrency has encountered a number of serious security incidents. The BU code had bugs that allowed attackers to conduct a DDoS attack, and in April 2017 more than 70% of the nodes failed due to memory leaks.
But despite a number of difficulties, the Bitcoin Unlimited project still remains a relatively popular fork and has 500 full-featured nodes. You can follow the development of Bitcoin Unlimited in their repository on GitHub.
At the end of 2015, developer Peter Woollet (Pieter Wuille) presented the SegWit initiative - Segregated Witness, which increases the speed of processing bitcoin network transactions. The approach does not increase the block size, but changes the way in which transactions are stored.
SegWit proposes to remove from the structure all the signatures, which, according to programmer Peter Vulle (Pieter Wuille), occupy 60% of the entire Bitcoin blockchain, and transfer them to another data structure - the extension block. SegWit was approved by 95% miners and was activated on August 24, 2017.
SegWit did not intend to increase the size of the blocks, so some participants thought that the innovation would not solve the scaling problem, but would only postpone it. The development team, led by former Facebook engineer Amory Sachet (Amaury Sechet), announced it would like to keep the blockchain structure as it was (without taking the information out of its limits), but increase the block size to 8 MB.
The developers of the new client did not wait for the support of the community, but simply announced the date when the branch would start working. Hardfork was named Bitcoin Cash, and from August 1, 2017, Bitcoin Cash wallets began to reject the blocks and transactions of the original Bitcoin.
Despite the spontaneous launch, the project was supported by many major players, including the investor Roger Ver and the mining platform ViaBTC.
An interesting feature of Bitcoin Cash was the possibility of miners to switch between Bitcoin and Bitcoin Cash, depending on the profitability of the "mining" of a particular currency. The phenomenon was baptized by “opportunistic mining” (opportunistic mining).
Today, this fork remains popular, and more than 1,200 nodes operate on its network.
The goal of Bitcoin Gold is to reduce the influence of “industrial” miners in the network. Developers implement a framework that would allow any user to mine cryptocurrency on a GPU and remain competitive.
The network was launched on November 12 of this year, but the start of cryptocurrency was unsuccessful. The cost of Bitcoin Gold, which jumped sharply the day before, dropped approximately twice in a day and fell below $ 200 per token. And three days after the launch of the mining pool, Bitcoin Gold was closed due to loss. The owner of the MinerTopia pool called BG mining “a waste of time and resources.”
The main trading of Bitcoin Gold takes place on the Bitfinex, HitBTC and Changelly exchange platforms. Some users still believe in the project and are convinced that the “gold” course will still grow.
This is a failed Bitcoin hardfork, which was originally signed by many CEOs of large companies in the Bitcoin ecosystem. SegWit2x was supposed to be a compromise for SegWit supporters and those who want to increase the block size (up to 2 MB).
However, part of the cryptocommunity considered that SegWit2x does not solve the problem of scalability and may lead to centralization of the blockchain network, and this contradicts the original concept of cryptocurrency. It turned out that the decision to rally the community only split it up more. It has become unclear which of the two Bitcoin networks will be considered the main one (Bitcoin Core or alternative).
The state of uncertainty was reinforced by the fact that the fork-client developers refused to include in it protection against a replay attack. The attack looks like this: a user on one network copies a check with the signature of another user and offers it for approval to another registry. So an attacker can spend other people's money in another blockchain, because one signature is valid in two registries.
/ image starwind.bc CC
These complaints about SegWit2x appeared during the Breaking Blockchain conference. Even the hashtag # no2x has swirled . Then many key companies announced that they would not support SegWit2x anyway, but even in this case the probability of hard forks remained. For example, Coinbase announced that they would call the new Bitcoin2x network.
But hardfork did not happen. The community rejected this idea due to the lack of consensus. On the Bitcoin2x side, there was excellence in hashrate (85%) of BitPay, Coinbase, Blockchain.com, BTCC, etc., and on the Bitcoin Core side, there was a generally recognized development team and a greater number of full nodes.
Regular users would have to decide which of the two blockchains to join and which wallet to use. Therefore, with hardfork, a “battle for a true faithful bitcoin” would begin, in which each side would bite off pieces from one pie.
Since the winner in this battle was not obvious, hardfork was postponed indefinitely. Until it becomes necessary.
A recent fork of bitcoin that occurred on November 24th. Its organizers are anonymous developers who organized the Bitcoin Diamond Foundation.
Bitcoin Diamond has received an 8-megabyte block and a new mining algorithm optimized for working with the GPU. More developers have implemented SegWit and implemented anti-replay protection. It is also considered that the anonymity of the new coin is higher than that of Bitcoin - the amounts of transactions and the balance in BD are encrypted.
This is the third hardfork bitcoin in the last four months, if you do not take into account deferred SegWit2x. And in the short term, forks have a positive effect on the rate of the “main” cryptocurrency, but the problem is the “fragmentation” of the market. The fact that with the ICO ban in China, many developers began to see the creation of forks as a substitute for raising funds could lead to even more ramifications.
And although the community is concerned that a large number of alternative cryptocurrencies will weaken Bitcoin, while it remained relatively stable, despite some shocks .
Today, Bitcoin costs $ 9.6 thousand, and investor Mike Novogratz (Mike Novogratz) is convinced that by the end of the year this figure will exceed the level of 10 thousand.
PS On our Facebook page we published a digest with materials on forks cryptocurrency . You can find it by reference .
Hardfork is the division of cryptocurrency into two chains by changing the processing rules and adding blocks. After hardforka, one branch works with nodes that support the new rules, and the second with nodes that refuse to support changes.
Since the advent of Bitcoin, the blockchain has experienced many hard forks. Some of them have not gained popularity for one reason or another (lack of support, software bugs), such as Bitcoin Unlimited, Bitcoin Classic, Bitcoin XT.
')
In today's material, we recall all the significant hard forks: who, when and for what purpose tried to "share" the bitcoin network.
/ image BTC Keychain CC
Bitcoin creation: genesis block
The history of Bitcoin began in 2008, when its creator Satoshi Nakamoto released a document, officially introducing a new cryptocurrency. In early 2009, he activated the network and generated the first block, the genesis block. He received a reward of 50 bitcoins. At that time, the protocol worked with a block size of 1 megabyte and processed a maximum of 7 transactions per second.
When the Bitcoin network began to grow, some of the restrictions began to cause inconvenience. For example, a megabyte block, although it was a defense mechanism against DDoS attacks, had a negative impact on network bandwidth. Therefore, people began to look for options for expanding the functionality of Bitcoin blockchain.
Bitcoin xt
Bitcoin XT is the first fork in the history of bitcoin. Bitcoin XT client launched by Mike Hearn in December 2014. Mike implemented several new features, including his own BIP 64 ( Bitcoin Improvement Proposal ). BIP 64 is an extension for the P2P protocol that allows you to quickly view a list with unspent transaction outputs (UTXO) to protect the system from re-spending already “translated” bitcoins.
Also, the task of fork of Bitcoin XT was to increase the transaction processing speed up to 24 transactions per second by “expanding” the block to 8 MB. Therefore, at the start of the new protocol, it gained popularity in the community: in August 2015, four thousand nodes operated on the network.
But over time, Bitcoin XT has lost its popularity. He never managed to gain a critical mass of users - 75% - in order to become a “standard”. In part, this was due to the lack of safe implementation of certain functions. The project did not receive the support of China's largest mining pools, and industry expert Meni Rosenfield (Meni Rosenfeld) published a comment on Reddit, in which he said that XT is a reckless act that shatters a stable structure and can lead to a community split.
By early 2016, the project was almost dead. Bitcoin XT is still supported, but it is considered an extremely small cryptocurrency - there are less than 20 nodes on the network. For comparison, in the main Bitcoin network operates 11 thousand nodes.
Bitcoin classic
Although Bitcoin XT failed, the community did not abandon the idea of ​​increasing block size and speeding up transactions. In February 2016, the development team conducted a new fork and created Bitcoin Classic. The source code for the project can be found on GitHub. He laid out the developer Gavin Andresen (Gavin Andresen).
The increase in the block in Bitcoin Classic was more modest, but still significant, up to 2 MB. However, eight months after launch, the creators changed policy, market participants began to determine the size of the block. Also, any user of the Bitcoin Classic network could influence the decisions about changes in the source code.
Fork received support from several major market players: Coinbase, Bitstamp, Circle, and Jeff Garzik, CEO of Bloq. However, immediately after the launch began to lose popularity.
Until recently, 100 nodes operated in the Bitcoin Classic network (compared to 2 thousand at the start), and on November 10 of this year, the developers announced that they would stop supporting the blockchain. Bitcoin Classic release manager Tom Zander (Tom Zander) wrote that all the ideas that Bitcoin Classic pursued now “promote” Bitcoin Cash (another bitcoin fork).
The Bitcoin Classic network participants were recommended to start using alternative wallets, because the work of the official client will be stopped in the coming weeks.
Bitcoin unlimited
The stable release of Bitcoin Unlimited occurred in May 2016.
The idea of ​​the project is that each miner can independently choose the block size. If a large number of miners are working on large blocks, while others say that they are not opposed to join, the network automatically begins to generate larger blocks.
By removing the restrictions, the Unlimited developers wanted to give the market the opportunity to regularly vote for the ideal block size. This should have resolved the block size dispute forever.
Bitcoin Unlimited cryptocurrency has encountered a number of serious security incidents. The BU code had bugs that allowed attackers to conduct a DDoS attack, and in April 2017 more than 70% of the nodes failed due to memory leaks.
But despite a number of difficulties, the Bitcoin Unlimited project still remains a relatively popular fork and has 500 full-featured nodes. You can follow the development of Bitcoin Unlimited in their repository on GitHub.
Bitcoin Cash
At the end of 2015, developer Peter Woollet (Pieter Wuille) presented the SegWit initiative - Segregated Witness, which increases the speed of processing bitcoin network transactions. The approach does not increase the block size, but changes the way in which transactions are stored.
SegWit proposes to remove from the structure all the signatures, which, according to programmer Peter Vulle (Pieter Wuille), occupy 60% of the entire Bitcoin blockchain, and transfer them to another data structure - the extension block. SegWit was approved by 95% miners and was activated on August 24, 2017.
SegWit did not intend to increase the size of the blocks, so some participants thought that the innovation would not solve the scaling problem, but would only postpone it. The development team, led by former Facebook engineer Amory Sachet (Amaury Sechet), announced it would like to keep the blockchain structure as it was (without taking the information out of its limits), but increase the block size to 8 MB.
The developers of the new client did not wait for the support of the community, but simply announced the date when the branch would start working. Hardfork was named Bitcoin Cash, and from August 1, 2017, Bitcoin Cash wallets began to reject the blocks and transactions of the original Bitcoin.
Despite the spontaneous launch, the project was supported by many major players, including the investor Roger Ver and the mining platform ViaBTC.
An interesting feature of Bitcoin Cash was the possibility of miners to switch between Bitcoin and Bitcoin Cash, depending on the profitability of the "mining" of a particular currency. The phenomenon was baptized by “opportunistic mining” (opportunistic mining).
Today, this fork remains popular, and more than 1,200 nodes operate on its network.
Bitcoin gold
The goal of Bitcoin Gold is to reduce the influence of “industrial” miners in the network. Developers implement a framework that would allow any user to mine cryptocurrency on a GPU and remain competitive.
The network was launched on November 12 of this year, but the start of cryptocurrency was unsuccessful. The cost of Bitcoin Gold, which jumped sharply the day before, dropped approximately twice in a day and fell below $ 200 per token. And three days after the launch of the mining pool, Bitcoin Gold was closed due to loss. The owner of the MinerTopia pool called BG mining “a waste of time and resources.”
The main trading of Bitcoin Gold takes place on the Bitfinex, HitBTC and Changelly exchange platforms. Some users still believe in the project and are convinced that the “gold” course will still grow.
Segwit2x
This is a failed Bitcoin hardfork, which was originally signed by many CEOs of large companies in the Bitcoin ecosystem. SegWit2x was supposed to be a compromise for SegWit supporters and those who want to increase the block size (up to 2 MB).
However, part of the cryptocommunity considered that SegWit2x does not solve the problem of scalability and may lead to centralization of the blockchain network, and this contradicts the original concept of cryptocurrency. It turned out that the decision to rally the community only split it up more. It has become unclear which of the two Bitcoin networks will be considered the main one (Bitcoin Core or alternative).
The state of uncertainty was reinforced by the fact that the fork-client developers refused to include in it protection against a replay attack. The attack looks like this: a user on one network copies a check with the signature of another user and offers it for approval to another registry. So an attacker can spend other people's money in another blockchain, because one signature is valid in two registries.
/ image starwind.bc CC
These complaints about SegWit2x appeared during the Breaking Blockchain conference. Even the hashtag # no2x has swirled . Then many key companies announced that they would not support SegWit2x anyway, but even in this case the probability of hard forks remained. For example, Coinbase announced that they would call the new Bitcoin2x network.
But hardfork did not happen. The community rejected this idea due to the lack of consensus. On the Bitcoin2x side, there was excellence in hashrate (85%) of BitPay, Coinbase, Blockchain.com, BTCC, etc., and on the Bitcoin Core side, there was a generally recognized development team and a greater number of full nodes.
Regular users would have to decide which of the two blockchains to join and which wallet to use. Therefore, with hardfork, a “battle for a true faithful bitcoin” would begin, in which each side would bite off pieces from one pie.
Since the winner in this battle was not obvious, hardfork was postponed indefinitely. Until it becomes necessary.
Bitcoin diamond
A recent fork of bitcoin that occurred on November 24th. Its organizers are anonymous developers who organized the Bitcoin Diamond Foundation.
Bitcoin Diamond has received an 8-megabyte block and a new mining algorithm optimized for working with the GPU. More developers have implemented SegWit and implemented anti-replay protection. It is also considered that the anonymity of the new coin is higher than that of Bitcoin - the amounts of transactions and the balance in BD are encrypted.
This is the third hardfork bitcoin in the last four months, if you do not take into account deferred SegWit2x. And in the short term, forks have a positive effect on the rate of the “main” cryptocurrency, but the problem is the “fragmentation” of the market. The fact that with the ICO ban in China, many developers began to see the creation of forks as a substitute for raising funds could lead to even more ramifications.
And although the community is concerned that a large number of alternative cryptocurrencies will weaken Bitcoin, while it remained relatively stable, despite some shocks .
Today, Bitcoin costs $ 9.6 thousand, and investor Mike Novogratz (Mike Novogratz) is convinced that by the end of the year this figure will exceed the level of 10 thousand.
PS On our Facebook page we published a digest with materials on forks cryptocurrency . You can find it by reference .
Source: https://habr.com/ru/post/343296/
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