ICO and token sales suffer nearly the same failure rate as most business start-ups. Dutch RaboBank is looking at creating a cryptocurrency wallet. Poloniex is acquired by Circle. JP Morgan and Bank of America admit that cryptocurrency is very competitive. Germany won’t tax bitcoin when used as a payment. US Department of Justice is making a boogieman out of crypto money laundering. Bitcoin SegWit has seen an increase in segwit adoption up to 30%.
It is with some lament that I write this. If everyone agreed on a path forward, then there would be no need for this post, but here we are. There is a strong likelihood that we will need to know what will happen if Bitcoin forks (again). There is a chance that the protocol of Bitcoin will fork, which will cause a chain fork as well. (I discussed hard forks & soft forks from my perspective in a previous post.)
Some Bitcoin miners are signaling that they would accept one of two competing Bitcoin protocol changes: one protocol is Bitcoin Unlimited (BU), which would increase the maximum transactions that Bitcoin can process by 100%. The other protocol, called Segregated Witness (SegWit), is expected to increase this maximum by 70%. As of this writing, 35.9% of blocks are signaling for Bitcoin Unlimited while 26.8% are signaling for SegWit.
Bitcoin Unlimited vs. SegWit: Abstractly, what is happening?
Let’s make a hypothetical situation where the proportion of Bitcoin Unlimited to SegWit votes stays the same, but is extrapolated out so that ALL Bitcoin miners MUST choose either Bitcoin Unlimited or SegWit. That would mean around 55% of miners would be supporting Bitcoin Unlimited and 45% of miners would be supporting SegWit. (There is an incentive to go with the “winning” majority chain, so this division of hashing power could be even more severe at the time of a hard fork.)
If Bitcoin Unlimited activated and a block over 1MB was mined, then the SegWit part of the network would reject this block and build off the previous block. With a drastic drop in hashing power but no change in the difficulty target, it would take the Bitcoin network longer to find the winning solution that confirms a new block to the blockchain. With our hypothetical numbers, blocks for Bitcoin Unlimited would come out approximately every 18.2 minutes and SegWit blocks would come out approximately every 22.2 minutes. Any transaction capacity increase promised by Bitcoin Unlimited and SegWit would be delayed until the difficulty target adjustment shakes out. As more blocks were found, the difficulty of each chain would adjust and after about a month (a little longer for SegWit), the 10-minute block time target would be restored.
How would this hard fork affect Bitcoin users?
A Bitcoin user with coins before the hard fork would then be considered to have a positive balance on both ledgers/blockchains after the hard fork. (The Ethereum blockchain forked after last year’s DAO debacle, yielding ETH tokens and ETC tokens (Ethereum Classic) for users who owned ETH before the fork.) But without taking care, a user could intend to spend coins on one chain and unintentionally spend on both chains; this is known as a replay attack, though it’s really not an attack if it’s done unintentionally. Maybe that should be called a replay error so as to not be confused with an intentional replay attack meant to defraud.
How does one guard against a replay attack after a hard fork?
Andy from a Bitcoin ATM company joins us in-studio to talk about his disillusionment with Bitcoin. Danish law enforcement have new tools that link Bitcoin darknet buyers and sellers. Controversial Bitcoin-for-pot bill in Washington State Senate not happening this term. United Arab Emirates is considering legalizing Bitcoin. South Korea’s bizarre presidential scandal is destined to be made into a movie.
All this and more on the Neocash Radio podcast, episode 195 — Wednesday, February 22nd, 2017!
We’ve written out short overviews of the topics discussed on today’s show below! Be sure to listen in to the whole podcast to get more information, insights, and thoughts on each of them from JJ, Darren, and Randy!
Dubai wants all government documents on the Blockchain by 2020. The United Nations is testing blockchains for funding and remittances. Onecoin is a scam and Bruce Fenton is concerned that its crash could stir up a call for crypto regulations. More scam wallets take down from the Apple Store. Darren calculates the half-life of Swiss francs given the negative interest rates. The US is engaged in a proxy war with Russia over regime change in Syria. Scaling bitcoin conference has no mention of blocksize increase. Augur ICO raises $5.3 Million. Randy attends the New Hampshire State House Cryptocurrency Commission.
All this and more on episode 177 here on Wednesday, October 12th, 2016!
We’ve written out short overviews of the topics discussed on today’s show below; be sure to listen in to the whole podcast to get more information, insights, and thoughts on each of them from JJ, Darren, and Randy!
Blockstream and core devs are called out for crippling the bitcoin network. Xapo parts ways with blockstream. Ethereum is coming to select Lamassu Bitcoin Machines. Scam alert for the BitcoinWisdom Ad Remover Google Chrome extension. The bank of England looks to create RScoin and the Telegraph posts sponsored content. The ECB increases QE and lowers interests rates from negative to more negative. Hackers steal from a central bank
The hashrate reaches new highs. JJ is on a Bitcoin panel in Concord, NH. The Free State Project reaches the signer goal of 20,000 while bitcoin based businesses thrive in New Hampshire. Cryptsy is no more and the story is grim. BlockStream has a good week of partnerships and funding. Bitcoin Classic binaries are online now. The European Union looks to further regulate pre-paid cards and bitcoin because, “terrorism”. The White House is asking for a $10 tax on each barrel of oil — underhanded highway robbery.