The 12 Months Of Crypto: November
This is part of a 12 part highlight reel by BlockWorks Group where we review the biggest crypto and blockchain story from each month of 2018.
The Story
One November 15th, the Bitcoin Cash blockchain performed its bi-annual software upgrade in which the network forks following consensus from its software developers. Under normal circumstances, consensus is met and this protocol update is considered to be softfork. This past time was different.
Instead of a united front the Bitcoin Cash community broke into two factions — the “conservative” faction known at Bitcoin ABC (Adjustable block size) let by Roger Ver and Bitcoin SV (Satoshi’s Vision) let by Craig Wright.
Let’s quickly break down the differences between Bitcoin, Bitcoin ABC, and Bitcoin SV looking at block size and centralization.
Bitcoin — 2MB block
Bitcoin ABC — 32MB block
Bitcoin SV — 128MB block
Block size determines the capabilities of transaction speed and because it would make sense that the larger block size would mean a faster network — one would think that Bitcoin Cash would make sense. Not so fast. Here is a heavy car metaphor:
Say we have a heavy traffic issue, so we decide to change the speed limit to 200 miles per hour. What will happen? First of all, there will be a safety issue because at this speed the chances of crashing and injuries increase. However a potentially bigger problem is that now old and small vehicles will not be eligible for highways, because they can’t move fast enough. So the highway will be full of big people with big strong cars and a regular driver will stay at home or take slower roads to get to where they want to be.”
The result? Centralization. More than 51% and 75% of mining on the Bitcoin ABC and SV blockchains respectively are done by a whopping total of 4 mining pools.
1 Month Later
If the goal of the Bitcoin Cash fork was to become the “true” bitcoin, then this internal hash war was the nail in the movement’s coffin.
Today, Bitcoin ABC (which has retained the ticker BCH across most exchanges) sits as the #4 cryptocurrency by MC with Bitcoin SV (BSV) trailing at #9.
But wait, where is the BSV?
Coinbase users who were holding Bitcoin Cash at the time of the fork are entitled to Bitcoin SV, just as those who were holding Bitcoin at the time of the original Bitcoin Cash hard fork were entitled to Bitcoin Cash. Here is an excerpt from an interaction with Coinbase one anonymous user reported:
It’s already been 7 WEEKS since that last update. “We will provide additional updates as they are available. We anticipate development work for BSV withdrawals will take at least a few weeks, but may take longer.” — so I think that I am entitled to an additional update. You have been busy adding new trading pairs, but cannot ensure that coins that your clients own can be given to them for them to use. That is unacceptable. Please escalate this to someone whom can provide a better answer.
Then, earlier this week, on the 2nd of January, Coinbase finally gave an answer:
I understand your frustration and I wish that there was more that I could do.
However, we will provide additional updates as they are available. We anticipate development work for BSV withdrawals will take at least a few weeks, but may take longer.
With 10 million account on Coinbase, it would seem that the overall Bitcoin SV market has yet to fully discover its price if potentially hundreds of thousands of BSV coins have been locked in Coinbase’s custody.
Moving Forward
Craig Wright of Bitcoin SV argued that only continuous mining would determine the winner. “Continuous competition until one dies as we do not stop.”
As coinbase said, all we can do right now is wait for an update with the hopes of seeing which Bitcoin Cash tribal faction hashes their way out of the Thunderdome.
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