Segwit2X: the broken agreement
Bitcoin has Segwit now! Woohoo! Whether you believe this is thanks to UASF (it is) or because of some closed, backdoor meeting with 12 participants (which ended up with 50 who subsequently signed after being led to assume there was wider support) doesn’t really matter now, we have Segwit, awesome!
After a slow start we’ve seen a steady increase in Segwit transactions with Bitstamp and BitGo switching to Segwit addresses last week. (with BitGo already having more than 13% Segwit transactions in last 24 hours)We now have ~3.5% Segwit Transactions after 3.5 weeks of activation.
Some users were disappointed by this rate of adoption since a lot of companies indicated they were Segwit ready on the website yet haven’t implemented it. This could partially be explained by the extra work the engineers had to do because of the BCash fork.
The 3 companies that abandoned the agreement so far:
It is important to note here that 2 of them specifically mention that they expected support from the Bitcoin Core developers, like with the Hong Kong agreement. I’m guessing more of the signees are, rightfully so, very worried about the total lack of developer support.
BCash: the deal breaker
BCash did cause some disruption. It didn’t make the Bitcoin price tank, as some predicted, however the miners started playing with the EDA (emergency difficulty adjustment) causing huge disruptions and backlogs on both chains at different times.
It also meant extra work for the service providers that wanted to distribute BCash to their customers and it actually stalled process on Segwit implementation for some companies.
It’s good that the big blockers (finally) have their own chain on which they can experiment with their own software and clients. But it obviously isn’t as innocent as it seems.
Segwit2x signees Bitmain, bitcoin.com, antpool, Viabtc, yours network, btc.top all supporting BCash rather than Bitcoin clearly shows that there is no NY agreement anymore.
Have the other SegWit2X signees helped Bitcoin scale?
Short answer: no.
Anyone that has heard Stephen Pair from Bitpay talk at Consensus this year about scaling would’ve thought that the first second Segwit would activate, they would roll out Segwit addresses for everyone to reduce their poor, overworked customer support. The same goes for blockchain.info, Coinbase and Shapeshift who have used “high fees” and “overwhelming amount of customer support tickets” as the main reason to activate Segwit2X asap. However none of them have so far implemented Segwit. Turns out it was a red herring.
Erik Voorhees did say he’s waiting for 0.15.1 before he implements Segwit on Shapeshift.
Those 4 companies together, if they actually do as many transactions as they claim they do, would cause a huge drop in fees for everyone, would clear the entire transaction backlog and reduce the total number in customer support tickets.
Now let’s look at the miners. After the activation of Segwit there is no limit of 1MB anymore, but there is a new parameter which expresses the total size in weight.
Because of more hashrate coming online, the EDA and miners playing games the Bitcoin blocks have actually been quite fast recently. We’ve all read the articles about the spam transactions, which still happens as you can see here:
The miners that signed the agreement that are still playing games:
- Antpool: is mining Segwit transactions and >1 MB blocks but at the same time manages to mine 6 empty blocks in 24 hours. (that’s ~12k txs less processed)
- Bitcoin.com: not mining any >1MB blocks.
- BTC.TOP: Not mining any >1MB blocks.
- 1Hash: empty blocks and not mining any >1MB blocks.
- BWPool: no >1MB blocks.
- 3 companies already left the agreement mainly stating the lack of Core developer support and lack of community support.
- 6 companies have been focusing on BCash, rather than Bitcoin. With this interview by Roger Ver being very clear: the only reason he supports Segwit2x is so he has more coins to dump to buy BCash.
- 5 miners have not properly implemented Segwit or bigger blocks that would immediately reduce the fees.
- No major players (like for example: Bitpay, Coinbase, Shapeshift, blockchain.info,…) have implemented Segwit yet for their users even though their major concern was high fees and huge customer support issues because of it.
- The mailing list is basically empty.
- Their Github is almost dead.
A couple of months ago exchanges released a statement that they would only support new forks if there would be a strong 2-way replay protection deployed. This is actually what BCash did right and what is missing with Segwit2X.
I was at Breaking Bitcoin in Paris, it was shocking how few Segwit2x companies had representatives there, even though it’s conferences like that where the actual (technical) future of Bitcoin is being discussed.
There is no real community support for Segwit2X. Companies do not speak for their users and their actions (of not implementing Segwit) speaks louder than their words. It will cause another split, people will lose coins (like some did with BCash too, sending coins to the wrong address).
We have Segwit now, let’s get the adoption going, let’s plan a safe scaling roadmap together, with the Core devs as they are an essential part of Bitcoin. BTC1 doesn’t have any devs, and if you think that Core devs will start working on BTC1, then you really don’t understand them.
Edit: I also think that given the current situation in China with exchanges (of signees) closing and the uncertainty about mining in China, the last thing we need is a split.