It’s hard to find a franker bunch in the world of blockchain.
While the attitudes of more corporate miners may have created the impression the sector itself is shrouded in secrecy, the trope doesn’t exactly hold weight. And though it’s true those who run the computers that secure bitcoin can be evasive, they’re often also brash – a trait no doubt heightened by the fact that they effectively create value out of thin air.
But combine this penchant with linguistic and cultural gaps, and you have a recipe for mixed signals. Quite simply, it can be hard to tell where miners stand on issues related to the technology – even those in which they arguably play a leading role.
Not to mention, in an industry that changes fast, miner’s opinions can evolve just as quickly.
Jiang Zhuoer, founder of the world’s third-largest mining pool, BTC.Top, for example, isn’t shy about his opinion on bitcoin’s upcoming Segwit2x fork, the third this year following bitcoin cash and bitcoin gold.
But Zhuoer, whose pool serves 12.4 percent of the world’s bitcoin miners, appears to already be personally embracing alternatives, even after signing an agreement that might suggest his preference would be otherwise.
He told CoinDesk:
“To be honest, I do not care about bitcoin now, bitcoin cash is bitcoin. I earn by mining bitcoin, [selling it] and buying bitcoin cash. We mine for the most profit and buy bitcoin cash.”
Such statements can send conflicting signals. After all, many of the network’s code proposals effectively call on miners (a significant stake of the network’s node operators) to initiate contentious changes to protocol rules. And while this practice has encountered criticism, it nonetheless persists.
Indeed, one of the biggest open questions ahead of bitcoin’s upcoming Segwit2x hard fork is how many miners will actually stand by their agreement to run the software, and if they will do so unilaterally, dedicating all their hash power to the cause.
As of now, metrics are only relative.
While most miners who signed the agreement write the phrase “NYA” into the blocks they produce, doing so isn’t binding. Further, due to the semantics of how mining works, it remains to be seen whether enough of the network will move to change bitcoin’s rules so as to eliminate the chance of creating another cryptocurrency.
The pool problem
Personal opinion aside, Zhuoer is in the business of selling what amounts to software subscriptions – the BTC.Top pool coordinating global miners into a unit whereby any rewards collected by any participant are distributed equitably.
So, while he may have certain opinions, Zhuoer must also consider users, a fact he acknowledges.
He notes, for instance, BTC.Top’s own mining aside, the company plans to allow customers to “choose to mine any coin” or automatically switch between blockchains, turning their computing power to whatever coin is most lucrative, even after Segwit2x.
So, while his mind is made up, he is less clear on whether he believes a blockchain split is likely, or that his opinion is material on the outcome.
“I do not know. We should ask bitcoin users,” he said via WeChat. “They decide the result.”
Haipo Yang, CEO of ViaBTC, the fourth largest pool by mining power, agreed, indicating that his pool will only offer bitcoin mining on the original bitcoin chain to begin.
“We have not received user request to run 2x. If 2x survives and the users request it, we will support both. Let the users have a choice,” he told CoinDesk via WeChat.
If Zhuoer and Yang’s statements are any indication, then, it might not be best to view the proposed figures for how much hashing power will support Segwit2x as set in stone.
Also on the record for backing out of Segwit2x is bitcoin mining pool F2Pool, with its operator Wang Chun telling CoinDesk in August that he didn’t support the New York Agreement any longer. However, at press time, F2Pool is still “flagging” for the change in its blocks.
As with Zhuoer’s operation, Chun operates a pool and it’s unclear whether his miners will be given the choice to run a version of the bitcoin software of their choosing.
Chun did not respond to requests for comment.
Although, there is some precedent for slow adoption of new software. In the rollout of bitcoin cash, mining pools slowly opened up to the new software, with ViaBTC launching the option first and BTC.Top and Bitmain’s AntPool following suit soon after.
The new statements suggest a similar, staggered approach could be ahead.
But, as noted in our explainer, the difference here is that bitcoin cash wanted to leave the bitcoin blockchain behind, while Segwit2x is seeking to make its code “bitcoin’s code.”
As such, a choppy rollout could have unseen and possibly unsafe implications, creating a period where there are two chains, even though one may win out.
But not everyone agrees that one version is likely.
Jan Capek, CEO of the fifth largest mining pool Slush Pool, said he’ll be aligning behind Bitcoin Core developers in their rejection of the Segwit2x software.
In his view, the introduction of the Segwit2x software will definitely “lead to the creation of two bitcoins” – one of which runs on a blockchain with bitcoin’s current rules, and the other which features the rules proposed by Segwit2x supporters.
Despite the fact that businesses are backing the proposal, he sees Segwit2x as the latest in a trend that’s bound to bring diminishing returns.
“I would expect that every new fork will have a smaller impact than the previous one,” he said.
It’s also notable that smaller miners seemed more inclined to believe a split is more likely. Li Ang, who operates 1 petahash-worth of mining equipment for a smaller mining pool called Canoe Pool, called it “an event with a high possibility.”
Likewise, litecoin developer ‘PZ,’ an organizer of a meeting that led to litecoin miners passing a tech upgrade in April, said Segwit2x “will create a new currency.”
Finally, Jack Liao, the CEO of Lightning ASIC, the company behind the bitcoin gold hard fork, also forecasted that “four chains” with four unique cryptocurrencies will likely survive November.
Still, the wild card appears to be whether bitcoin cash has effectively shifted perception, as the blockchain boasts an 8 MB block size, considerably higher than the 2 MB block size Segwit2x will introduce.
With this in mind, it isn’t just Zuoer who noted he prefers bitcoin cash to Segwit2x. Roger Ver, CEO of Bitcoin.com, an educational website that offers a mining pool, said that while he’s “very bullish” on the fork in the short term, he’s “even more bullish” on bitcoin cash in the long run.
Inked in May, the New York Agreement predates the creation of bitcoin cash and so doesn’t appear to factor that cryptocurrency in. But industry observers believe the creation of the bitcoin cash protocol and the investments that have been made into it have shifted long-term strategies for miners.
Evoking the grand terms that sometimes best befit bitcoin power games, Steven Mosher, head of sales and marketing at mining chip maker Canaan, believes that, in the long-term, miners will support Segwit2x as a way to boost investment in bitcoin cash. Indeed, Mosher, whose company sells chips to miners big and small, said his customers largely have a preference for bitcoin cash, and he noted he sees them participating in the build-up of what he called a “long-term infrastructure play.”
All in all, he sees the Segwit2x fork as part of some behind-the-scenes power jockeying that will continue to pit miners against developers against businesses, perhaps in the self-interest necessitated all along by the nature of bitcoin’s distributed system.
“In the mining world, they believe value follows hashrate. More chains equals more hardware.”
Bitcoin split image via Shutterstock
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Published at Wed, 01 Nov 2017 18:00:15 +0000