Bitcoin is poised to activate the controversial blockchain technology known as Segregated Witness (SegWit) over the next 6 weeks, after years of debate along with an ill-timed and ill-worded statement by BitMain, owner of Bitcoin’s largest mining pool. In the 48 hours following BitMain’s Hard Fork announcement two, smaller but important Bitcoin players BitSquare and SlushPool, signaled their dissatisfaction with BitMain’s “contingency plan.” Though of the two only BitSquare has explicitly signaled BIP 148 acceptance, their collective defection from BitMain are large cracks in a dam that will lead to full release.
On 14 June, BitMain played what it considered to be an ace-in-the-whole: they forced mining pools and exchanges to choose between Bitcoin with SegWit activation through BIP 148 and BitMain’s version of Bitcoin. BitMain’s leadership thought they could coerce all others into compliance because of their significant hashing capacity. But instead, it seems that BitMain overplayed their role in the Bitcoin ecosystem, galvanizing opposition in the small but growing Bitcoin subculture of the so-called User Activated Soft Fork (UASF) through Bitcoin Improvement Proposal (BIP) 148. BitMain thought that due to Bitcoin’s ovulated governance model and their large hash power holdings that they could make the play. What they didn’t anticipate was that the relatively fledging UASF followers would use BitMain’s power grab as a rallying cry to the cause of the "Users.” A useful tool in tracking support for the various methods used to activate SegWit began to light-up in support of SegWit via BIP 148 following BitMain’s announcement. Now, it’s probable that SegWit will activate sometime within the next 6 weeks.
The renewed feeling of SegWit support is because BIP 148’s protocol requires Nodes to begin rejecting non-SegWit blocks as the clock rolls onto 1 August GMT 2017. Some call 1 August 2017 Bitcoin’s Independence Day, I shortened it the BID, pun intended; traders understand the significance of the term BID. Just a few weeks ago, the BID seemed to be on shaky ground because of the technical uncertainties of the UASF. Today, there’s less uncertainty about SegWit, in fact, there’s the possibility of an even earlier activation of SegWit via BIP 91 which requires an 80 percent hash rate activation level vice the previously higher level of 95%.
Just a few weeks ago, 80% might have seemed a bridge too far, but BitMain’s push for its own version of Bitcoin makes 80% all the more possible. Even if BIP 91 does not activate, BIP 148 will definitely activate as it does not have a hash requirement. Indeed, some commentators necessitate a 20% hash rate commitment prior to BIP 148 activation, as a sign of legitimacy, it’s pretty clear that this number may be a low watermark. Why? Because now miners will have to choose between a coin completely controlled by BitMain with its repertoire of secret developers and the Bitcoin Core version of Bitcoin supported by Users. Moreover, there is a growing list of exchanges and commercial interests supporting BIP 148. Regardless of support of BIP 148, there is a clear rejection of BitMain’s proposal.
While SegWit activation is encouraging, as I’ve written about before, Bitcoin’s SegWit discussion is less about technical viability and more about governance. Even with SegWit activation virtually assured this summer, Bitcoin’s governance problems persist. Nearly simultaneously to BitMain’s release of its dictatorial cryptocurrency governance model which is Ethereum-esque, I proposed the Tetrahedron Model of Bitcoin Governance on Steem. The Tetrahedron Model is a rough framework that I hope to develop over the next few weeks into what I hope to be Bitcoin’s first "Black Paper.” Ultimately, even with SegWit activation within sight, governance cannot continue to be elusive for Bitcoin.
Authors get paid when people like you upvote their post.
If you enjoyed what you read here, create your account today and start earning FREE STEEM!
If you enjoyed what you read here, create your account today and start earning FREE STEEM!