*** 18 November Update: Please be advised that the recent Bitcoin Cash hard fork on Sunday 15 November 2020, CoolWallet is responding as follows:
- CoolWallet now recognizes Bitcoin Cash Node (BCHN) fork as the official BCH fork
- we have enabled Bitcoin Cash transactions again
- we are keeping our eyes on Bitcoin Cash ABC (BCHA) and wouldn’t exclude the possibility of supporting it in the future.
***Update 13 November: CoolWallet will be suspending BCH transactions from UTC 00:00 on November 15 2020 until the outcome of the Bitcoin Cash upgrade and possible fork are clear.***
What’s Up With Bitcoin Cash? (TL;DR)
On Sunday, November the 15th 2020 the Bitcoin Cash (BCH) cryptocurrency protocol’s upgrade resulted in a hardfork into two different BCH chains, Bitcoin Cash Node (BCHN) and Bitcoin Cash ABC. BCHN has been adopted by an overwhelming majority of miners after the upgraded and is therefore now considered to be the new official Bitcoin Cash.
The network upgrade has caused a division within the BCH community in 2020. The main reason for the latest strife within the BCH community which has caused it to split into two camps is a controversial new upgrade proposed by Bitcoin ABC’s lead developer Amaury Sechet, which aims to reward its developer fund with 8% of mining profits, something strongly opposed by the vast majority of its community.
Bitcoin ABC, the incumbent and most powerful full-node Bitcoin Cash implementation up to now, had been controlling the development of BCH almost since it forked from Bitcoin in 2017.
However, Bitcoin ABC’s lead developer’s recent announcement caused a “mutiny” with most of the BCH community abandoning it, tired of Sechet’s authoritarian control over the development of Bitcoin Cash .
Only a few days before the fork, it was estimated that well over 80% of block miners on pools such as Antpool and Btc.com will support Bitcoin Cash Node over Bitcoin ABC.
Let’s look at 10 BIG questions as Bitcoin Cash after the hardfork:
Q1: Why did Bitcoin Cash “hardfork”?
Bitcoin ABC’s lead developer since its inception in 2018 has increasingly lost the support of his community and miners in recent months for introducing the controversial coinbase rule change that he planned to add to Bitcoin Cash’s latest protocol upgrade.
As a result, a competing protocol Bitcoin Cash Node, has been developed and began to gain community support. There would likely be one clear winner: the chain that is supported by the most miners. This has now emerged as Bitcoin Cash Node (BCHN)
The winning chain has been adopted by the major exchanges and miners since. This type of evolutionary event is par for the course in the world of cryptocurrencies, and a powerful tool to ensure the democratization of a blockchain.
Miners or stakers vote with their network hash power for the common good of everyone when communities can’t reach consensus over decisions or upgrades.
Q2: What changes will the Bitcoin Cash upgrade bring?
According to Bitcoin Cash’s website, the network upgrade implemented these changes:
- Replace the current Difficulty Adjustment Algorithm (DAA) with a new algorithm ‘ASERT’.
- Implement Automatic Replay Protection
- Implement the Coinbase Rule (only for Bitcoin ABC miners)
1) ASERT replaces DAA
DAA has been replaced by ASERT for 4 reasons:
- to help end disruptive variations in Bitcoin Cash’s difficulty and hash rate
- to bring block maintenance intervals to as near to 10 minutes as possible
- to improve the average transaction confirmation time closer to its targeted time
- to create a more equal profit split between steady miners and miners that roam between different blockchains.
2) What is Bitcoin Cash’s Automatic Replay Protection upgrade?
The Automatic Replay Protection upgrade will ensure that validating nodes that don’t upgrade on 15 November separate themselves from the main network after Bitcoin Cash’s next big upgrade, scheduled for 15 May 2021.
3) What is Bitcoin ABC’s “coinbase rule”?
The “coinbase rule” (a technical term unrelated to the Coinbase exchange!) is the cause of the split in the community, and will only be supported by the Bitcoin ABC (BTCA) upgrade version. Its official term given by Sechet is the Bitcoin Cash Infrastructure Funding Proposal (IFP).
Why has it caused so much of a rucus? Well, it’s because it will send 8% of all block mining rewards to a specific “development fund” BCH address controlled by ABC lead developer Amaury Sechet. However, the community believes that it would be a better way to fund the team by volunteering donations.
The community immediately began turning their allegiance from Bitcoin ABC to BCHN as its proponents insist the coinbase rule is not needed. Even though Sechet has threatened that “the BCHN chain will be wiped out”, the opposite now seems true, with most of the communities’ biggest names announcing their support for BCHN and even Bitcoin ABC creating a version of BCHN .
No details have been finalized and the fork may not happen. However, it seems very likely, as no consensus has been reached between the two sides of the conflict.
Q3: What is Bitcoin Cash Node (BCHN)?
According to its detailed whitepaper , Bitcoin Cash Node (BCHN) is a full-node project that is well-supported by its development community and offers a safe client implementation for BCH.
BCHN already served as a drop-in replacement for Bitcoin ABC as it has the longest chain after the May 2020 network upgrade.
It’s vision for BCH is that of a competitive, diverse and cooperative network, with professional development, maintenance and support and research-backed and inclusive governance.
Q4: How did miners signal which Bitcoin Cash fork they’d support?
Since a few months ago, Bitcoin Cash miners have begun to cleverly “signal” who they would support after the fork, by adding clear text messages to new mined blocks, for example “PoweredbyBCHN”.
Q5: How did Bitcoin ABC respond to BCHN and what happens after?
Due to overwhelming pressure, Bitcoin ABC said on Twitter (6 November 2020) that it would support both BCHN and Bitcoin ABC after the fork, and respect their community’s right to choose.
In a blog post on 6 November, Bitcoin ABC said the following:
“We still believe that reliable funding for network development is crucial for building sound global money. It will allow technical talent to be hired at scale so the network can be developed quickly, and it will also fund broader ecosystem development to attract new users. That’s why we’re committed to building on the BCHA chain, which will continue the roadmap we created in 2017.”
However, due to the BCHN’s massive popularity and community requests, Bitcoin ABC will release Bitcoin ABC:BCHN edition which will allow businesses who want to follow the BCHN chain to do so using the same Bitcoin ABC software.
The BCHN edition will be kept for the foreseeable future but, since it will have no reliable funding and no roadmap, their support will be limited to software maintenance.
Experts are still divided on whether Bitcoin ABC will sink if Bitcoin Node wins out, as Sechet is the most experienced Bitcoin ABC developer and has a nearly encyclopedic knowledge of the cryptocurrency that will be nearly impossible to replace.
Q6: Which Bitcoin Cash fork will exchanges support?
Most exchanges will now support BHCN, as it has the most mining hash power post-fork.
Q7: How should miners, exchanges and businesses react?
Businesses had three choices:
- Run Bitcoin ABC 0.22.6 (BCHA network), or any previous 0.22.x version, to follow the BCHA chain. This chain will be immune to the risk of wipeout and block reorganization.
- Run Bitcoin ABC 0.22.6 (BCHN network) to follow the BCHN chain. This chain will NOT be immune to the risk of wipeout and block reorganization.
- Run both to follow both chains.
Q8: Will my exchange or wallet support the Bitcoin Cash upgrade?
Here are some planned responses by the world’s leading exchanges and wallet providers. Please note that this information can change at any time. As with most hard forks, the majority of exchanges and wallet providers will manage distribution of new coins to its users automatically. However, to be sure, you should check with your wallet provider or exchange for the latest accurate information. Remember, owning crypto is taking personal responsibility for your investment!
Binance
Binance announced that if current signaling trends continue, “Binance will treat the BCHN chain as the future BCH chain.”
Binance will suspend BCH deposits and withdrawals on the day of the hard fork at 10AM UTC, then act depending on which of the two presented scenarios comes true: there are two competing chains, or there is no new coin. However, spot trading will continue throughout the upgrade.
Coinbase
Coinbase has already announced on social media that it will run BCHN nodes prior to the upgrade as it expects it will be the dominant chain post fork.
Kraken
The Kraken exchange says that it “will support [the] Bitcoin Cash Node regardless of the outcome of the fork.” “Bitcoin Cash Node tokens will be called ‘Bitcoin Cash’ on Kraken’s platform and represented by the ticker symbol ‘BCH’.
Kraken will only support BCHA if its hash power reaches at least 10% of the hashpower on the BCHN network. In that case,, it will be called ‘Bitcoin Cash ABC’ on their platform and represented by the ticker symbol ‘BAB.’
Ledger
Ledger will suspend their BCH services from the 12th of November at 07:00 UTC for security reasons and will also be keeping an eye on the developments after the fork to see which chain will remain viable both technically and economically.
Trezor
Trezor’s parent company SatoshiLabs asserted on 5 November it will wait for the community to determine which Bitcoin Cash implementation will dominate the network moving forward:
“SatoshiLabs will not be participating in the fork until a decision is made by the community. If you wish to take part in the fork, you should transfer your BCH balance to another wallet which is supporting the coin split, to make sure you receive any coins resulting from the hard fork.”
However, this has led to mass complaints on social media.
Huobi
Huobi Global will support the BCH hard fork if it occurs. In order to avoid volatility and ensure security, Huobi has the following contingency plan in place.
OKEx
OKEx has announced their support for the hard fork, stating that, should it be successful, OKEx users holding BCH prior to the fork would receive the two new assets, BCH ABC and BCHN. In the days leading to the fork the BCH margin lending function, spot and margin trading services, and deposit function will all be suspended. Huobi Global made similar statements, adding that “after the community has formed a consensus on BCH naming, we will end the transition period and rename BCHA or BCHN.”
FTX
FTX also discussed the competing chain scenario, stating, as Binance did, that “users will be credited with the BCH from the chain with the most work done.”
Q9: Roger that: Is Ver involved?
Short answer: Of course! Bitcoin Cash’s vocal supporter, investor and Bitcoin.com owner Roger Ver did much to help promote Bitcoin Cash during and after its August 2017 hardfork from Bitcoin, as well as BCH’s 2018 “civil war” between Bitcoin ABC and Bitcoin SV (BTC SV) in 2018, which Bitcoin ABC unofficially won.
Ver has been very dismissive of both Sechet and the IFP coinbase rule, comparing it to Soviet communism!
It’s tough to fight against Ver, as Craig Wright found out to his regret when he lost a lawsuit against him. Luckily Roger seems to love the CoolWallet S nearly as much as he does BCH!
Q10: What should CoolWallet S users do if Bitcoin Cash does hardfork?
- CoolWallet now recognizes Bitcoin Cash Node (BCHN) fork as the BCH official fork
- we have enabled Bitcoin Cash transactions again
- we are keeping our eyes on Bitcoin Cash ABC (BCHA) and wouldn’t exclude the possibility of supporting it in the future.
To stay up to date, please check our Twitter account (@coolwallet) and blog for official updates.
Disclaimer:
CoolBitX provides these blog posts for general educational purposes only. Information on this blog expresses the opinion of the author only. It does not constitute professional legal or financial advice and should not be considered as such. The author or company may update the information on this article at any time without prior notice and do not guarantee the work to be up to date and accurate. To the best of our knowledge, the information provided here is factual at the time of writing.
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