THE DEBATE OVER BITCOIN EXPANSION(III）

The final battle and the fiasco of BitcoinUnlimited

After explicitly opposing the expansion of the block, Core's "Separated Witness + Lightning Network" route is more clear: firstly through the soft fork to achieve isolation testimony, then online lightning network, lightning network to undertake the main chain payment function, to achieve a generalized expansion (This is the Core expansion plan that some people have emphasized. As mentioned in the previous article, this is not the focus of the debate. For the block expansion, it is urgent to meet the market demand through simple block expansion, and continue to promote SW on this basis. +LN, to achieve multi-level expansion. "Expansion" in the "expansion of expansion" refers to the increase in block size limit). In November 2016, the Core development team released the Segwit code, submitted to BIP141 on December 21 and asked everyone to start voting on November 19th. The activation line is 95% and the voting position is bit-1._DJMINER

The basic idea of ??segregating witnesses is to separate the signature of the transaction from the transaction and place it outside the original block. The main benefits are three:

1) Eliminate transaction scalability. In the case of a transaction and a signature, the hashed transaction ID can hash the new transaction ID if the signature is valid. For exchanges and wallets that determine whether the transfer is successful based on the transaction ID, it may be deceived to be re-issued, that is, the so-called "extended attack", which has been encountered by many exchanges such as Mt.Gox. Separating transaction information and signatures with segregated witnesses can make transaction IDs unique and eliminate scalability issues.

2) Advance the lightning network. By eliminating scalability and achieving unique transaction IDs, the development of Lightning Networks and other applications can be made easier.

3) Expand 30% capacity. Since the signature is placed outside the original block, the 1M block can accommodate more transactions, which is equivalent to expanding the block capacity. According to estimates, it is possible to increase the capacity by 30%, which is equivalent to expanding the block to 1.3M. This is actually the case. It is said that in the test environment, the maximum capacity can be expanded to 4M. This became a supporter of the Core, saying that the isolation testimony is also an important basis for block expansion.

Before the failure of the Hong Kong consensus, the Bitcoin community generally supported the isolation testimony of Core. However, after Core’s failure to believe in the Hong Kong consensus, there are more people who oppose the segregation of witnesses. The main reasons include:

1) SegWit changes the underlying data structure. Segregated Witness strips the signature from the original transaction, changing the underlying structure of the Bitcoin: the structure of the transaction and the block.

2) SegWit strengthens development centering. Isolation Witness modifies a large amount of code, making subsequent development more complex and relying on Core, reducing the decentralization of development;

3) SegWit updates are irreversible. Once the quarantine witness type transaction is wound up, the entire system can no longer abolish the quarantine witness, because this will result in the loss of funds for all quarantine witness transactions.

4) Increase the risk of attack by 51%. Since the quarantine witness transaction is a transaction that everyone can spend in the non-segregated witness version, as the quarantine witness transaction increases, the potential gains of launching a 51% attack plundering quarantine witness transaction funds are growing.

5) Change the direction of Bitcoin development. In conjunction with controlling block capacity and implementing lightning networks, Core's goal of segregating witnesses is to remove the payment function of the Bitcoin backbone and turn the target of Bitcoin from currency to settlement network.

6) Missed the opportunity to develop the bull market. At that time, the bull market had already started, and the expansion of the block could immediately expand the capacity to meet the market demand of the bull market. At the same time, it would take at least "18 months" to expand the capacity through the isolation witness and the lightning network.

In addition to the expansion and isolation testimony, the community’s disagreements also have hard forks. Another reason for Core's opposition to block expansion is that directly increasing the block capacity limit requires hard fork upgrade, that is, the upgraded version is not compatible with the previous version. If some nodes are not upgraded, the blockchain will be split into two. chain. Core (especially Gregory Maxwell) thinks this is too dangerous, and the isolation testimony is achieved by a soft fork upgrade, which is more secure.

Support for block expansion supports hard forks, as this is really necessary. But those who support the quarantine witness also have a lot of support for hard fork implementation, because the code size of the quarantine witness is inherently large, and the soft fork needs to add more code and more complexity in order to be compatible with the previous version. Moreover, in the long run, continuous soft fork upgrades will lead to more and more complex system code and more and more technical debt.

After the rise of Bitcoin Unlimited, a more serious disagreement could not be avoided: Can Core and the firm expansionists no longer compromise and accept the split of Bitcoin? This problem is closely related to expansion and hard forks. If Core does not compromise, expansion and hard fork will lead to split. Most community members are afraid of splitting, fearing the collapse of the currency.

However, the voice of the expansion party accepting division has gradually increased. In June 2016, Meni Rosenfeld published an article "How do I overcome the fear of forks and fall in love with the forks" . In August, Andrew Hinkes used the Ethereum fork to analyze the possibility of bitcoin forks in the chain expansion meeting. (http://www.onchainscaling.com), in December, Liu Chang used the paper to argue that the essence of the contradiction is the dispute between the two lines of the world currency and the settlement network. It is difficult to reconcile, and the exploration of each fork is a feasible solution, two directions. The probability of exploring overall success is greater.

By the beginning of 2017, the bitcoin bull market had just started. In the case of a bitcoin network transaction congestion and a 10x increase in fees, the expansion and fork problems became very acute. Expectations, panic, anxiety, anger and other emotions permeated the community. .

At this point, the global Bitcoin community revolves around:

1) Whether to support block expansion;
2) Whether to support the isolation testimony;
3) Whether to support hard fork upgrade;
4) Whether to trust the Core;
5) Can you accept bitcoin splits?

The above five key points have formed a complex pattern. Generally formed three camps:

1) Core and its staunch supporters. Both support the isolation testimony. A very small number of core members are firmly opposed to block expansion, and Luke Dashjr even advocates shrinking blocks to 0.5 or 0.3M. However, most people still hope to expand, but only firmly support all decisions of Core;

2) Firmly expand the party. Support BU, do not trust Core, insist on hard forked block expansion, not even afraid of fork. The opinions on SegWit are not consistent. Most people are willing to accept SegWit under the premise of block expansion, and a few people firmly oppose SegWit.

3) Unify the neutrals. They support block expansion, some support hard fork upgrades, most support isolated witnesses, do not fully trust Core, and do not fully trust BU. The key thing is that they believe that bitcoin can only have one chain, and bitcoin can never be split anyway!

At the beginning of 2017, the competition between Bitcoin Core and Bitcoin Unlimited was heated up. Through block voting, the computing power to support BU expansion and support for segregated witnesses failed to reach 30%.

In the face of the deadlock, isolated witness supporter Shaolin Fry proposed a more aggressive SegWit implementation, "User Soft Fork Activation" (UASF), and formed a formal proposal BIP148 on March 12, 2017. The proposal suggests that the developer set the quarantine witness activation date in the new version, the node updates to the new version, no power vote, and the quarantine witness is automatically activated at expiration.

The key to the UASF is to bypass the miners, and the computing power no longer has the power to decide. Shaolin Fry explicitly opposes the miners (computing power) to determine the consensus rules, he proposed further modifications to the UASF on October 1 (later ahead of August 1) miners will be required to activate SegWit, otherwise digging Mines are not eligible for block rewards.Yu Yongquan is a staunch supporter and advocate of the UASF.

Bit Continental Wu Jihan firmly opposes the UASF, and he believes that the UASF without the support of power will lead to division. Subsequently, in March 2017, the ant mine pool will switch all the power to BU, and the BU support rate will exceed 30%.BU's support rate in the community has also increased rapidly. Core and its staunch supporters are no longer the majority.

Gregory Maxwell does not approve of the UASF and believes the risk is too great. But the UASF is an attractive option for Core supporters who want to circumvent the stalemate and deploy SegWit as soon as possible. On March 24th, the famous Bitfury mine pool was marked with support for UASF. However, more mining is neutral, including Wu Gang’s good bitcoin (current currency letter), which was at the time in China, and the world’s largest pool of fish ponds.

However, Core's biggest advantage lies in continuous development experience and technical strength, which is lacking in BU. Moreover, the BU has designed complex elastic expansion for expansion, and added new features such as Xthin, which increases the complexity of development. Well-known bitcoin technologist, Andreas Antonopoulos, author of "Proficient Bitcoin" warned BU's consensus system and hard forks are at risk, ) he would rather support Bitcoin Classic.

It is the technical problem of BU that eventually led to the defeat of BU and expansion.

A bug in the BU on February 2, 2017 caused Bitcoin.com to dig a lone block. As the bug is resolved quickly, there are no more isolated blocks and the negative impact is small. But then, a bug on March 14 was exploited to attack, resulting in 410 of the 780 nodes dropped, recovering after 24 hours; on April 24, 70% of the BU nodes crashed due to memory leaks; 5 On the 8th of the month, it was attacked again, and about 70% of the BU nodes were dropped.

The three major failures of the system caused almost everyone to lose confidence in the BU. The community sentiment turned sharply, and a large number of neutrals turned to support Core. Yuchi began voting for SegWit in April, and SegWit's computing support also exceeded 30%. The firm expansion team once again lost the bitcoin development version that can be countered and was once again in trouble._DJMINER

New York Consensus: The Last Compromise

In March 2017, the bull market started, password currency transactions were active, and bitcoin congestion and handling fees soared._DJMINER

Under normal circumstances, in order to ensure that a transaction is confirmed in about 10 minutes, the memory pool size of Bitcoin storage unconfirmed transactions should be within 1M, but the memory pool volume in March has reached 74M, reaching 157M at the end of May, and congestion in December. The highest peak reached 285M. In other words, a new transaction in March has to wait for 74 10 minutes on average, that is, 12 hours to confirm, waiting for 24 hours to confirm at the end of May, and an average of 2 days and 2 nights in December!

In January 2016, the transaction fee when the block was not full was only 0.58 yuan per month. Due to congestion, each transaction fee rose to 6.60 yuan in March 2017; it rose to 19.81 yuan in June; the highest peak in December reached 224 yuan per pen! This does not include the direction of the mine pool to package a transaction, the "acceleration fee" of up to thousands of dollars. Dell, Microsoft, and Steam, which have accepted bitcoin payments, have given up bitcoin payments.

Faced with congestion and high fees, traders in the market, especially arbitrage traders, have turned to ETH, XRP and LTC for transfers.

From March to June 2017, the price of ETH soared from $13 to $385, nearly 30 times; XRP nearly 53 times in three months; LTC also turned 7.5 times; BTC only doubled during the same period.  The market value of BTC dropped from 85% at the beginning of March to 39% in mid-June, while ETH reached the highest 31% at this time.

Some people blame the expansion of the 2017 BTC market on the expansion side, especially due to the emergence of BCH. However, in June 2017, Bitcoin Unlimited has failed and BCH has not yet appeared. The loss of absolute advantage in the bitcoin market was entirely caused by the failure of expansion, and congestion and high transaction fees drove the users away.

Expansion, no time to delay!

In order to break the deadlock, Barry Silbert, founder of Bitcoin's Digital Money Group (DCG), stood out at this critical moment. He launched a series of one-to-one communication with major companies and developer representatives in the industry, mediating and softening the parties. Position, it is planned to hold a consensus meeting in New York in May.

Blockstream CEO Adam Back also promised to participate in face-to-face negotiations. However, Adam was "severely blocked by another partner" before his trip, and announced his refusal to participate in the New York meeting. He switched to Bitstream China (BTCC) to transfer to Blockstream's Samson Mow (缪永权) in April. However, Qi Yongquan’s reputation in the industry was poor. He was transferred to Blockstream during the difficult time of BTCC, and spread Purse to receive Wu Jihan’s 300,000 US dollars, which was questioned by Wu Gang in public. As a result, some important companies claim that if Samson Mow attends, they will withdraw from the meeting, and for this reason, host Barry refuses to attend Samson. The New York meeting was held without the attendance of Blockstream and Core.

At the New York meeting on May 21, 2017, representatives from 58 companies from 22 countries including mining, exchanges, wallets, and browsers throughout the industry chain attended the conference.As a participant, Wu Jihan detailed the details of the New York meeting in the ten questions of Wang Feng one year later.

The focus of the discussion in the New York meeting is: whether SegWit activation should be bound to hard fork expansion, so that both can be carried out simultaneously.

In order to balance Core's position, Barry intends to represent the Blockstream party who is not present. I hope everyone can agree to activate SegWit first and put the expansion into a position. But most companies on the site require binding together. For example, Bitpay, Blockchain.info, etc. all pointed out that the current bitcoin expansion situation is urgent. If they can't be bundled together, their users will be forced to pay high fees, and they must support other password currencies, such as Ethereum. Some companies also said that if they can't reach an effective agreement that conditions are bound to each other today, they will immediately leave. They said that Core has refused to implement the Hong Kong consensus. Why do we have to repeat a Hong Kong consensus in New York?

Representatives of Bitfury also participated in the talks. Bitfury has always supported the block position, but surprisingly, the representative of Bitfury is extremely supportive of the binding to expand together. The representative believed that if so many companies reached a consensus, a few Core's extreme blockmakers couldn't do anything, and Bitcoin expansion would certainly succeed.

Finally, the representatives present at the scene formed a consensus, ready to implement the SegWit+2M binding expansion program, which is later known as SegWit2X. However, a tiny technical detail has once again changed the development of the situation.

Delegates reached the New York Consensus (SegWit2X) on May 21 and decided to support SegWit2X in the 4th place of the power-voting byte. On the 22nd, Barry formed the document and collected more support and signatures, so the major developers and companies that did not participate in the meeting also learned about the content of the consensus agreement.

However, on the evening of the 22nd, before the consensus agreement was released to the public, Core developer James Hillard pre-emptively submitted a BIP91 proposal, which agreed to reduce the original 95% of the SegWit implementation proposed by Core without block expansion. The voting threshold is reduced to 80% and can be adjusted according to the situation. The key is that the power vote flag is also set to bit-4!

More importantly, the implementation of the SegWit soft fork and 2M expansion hard forks agreed by the New York Consensus is chronological. The SegWit soft fork is implemented first, and the hard fork is expanded to 2M two months later. BIP91, like the first half of the New York Consensus, activates the SegWit soft fork, but the BIP91 does not have the 2M hard fork expansion. With the same voting position, some Blockstream supporters can pretend to vote according to the New York consensus, and then SegWit will declare that they support BIP91 instead of the New York Consensus, and then oppose 2M hard fork expansion. Later, some New York consensus signers, such as Yuchi, did, and Yuki Wang Chun even publicly claimed that the New York Consensus was signed to "scam"!

Blocking expansion by various means is what Blockstream has been doing, but why are miners who are deceived by the Hong Kong Consensus still supporting Blockstream? A very important reason should be the technical failure of Bitcoin Unlimited.

For technical security, many people prefer Core and Blocksteam to continue to dominate the development of Bitcoin. For example, Pan Zhiyi, who later left the technology core of Bitland, clearly expressed his approval for the expansion in the live broadcast, but the BU technology is too bad, so it still supports Core. This was the more common view at the time. As for the split between BTC and BCH, many people gradually accept Core's cell block and settlement network logic, no longer advocate expansion, which is a follow-up.

During the New York Consensus period after the collapse of Bitcoin Unlimited, the bitcoin community sentiment was undergoing dramatic changes. Some of them were more determined to support block expansion and no longer believe in compromise. Some people are more determined to support Core and SegWit, but most people I am tired of the expansion of the dispute, I hope to end the dispute as soon as possible, resolutely oppose the split, maintain the unity of bitcoin, and protect the hard-won big bull market.

In this change, the New York Consensus has no Core participation, two lack of technical advantages, three 2M expansion is insecure and may still lead to split. This consensus is very fragile, and now it is doomed to fail._DJMINER