Recap of PCTA Reddit AMA Series # 2
On November 21 at 21:00 (UTC+8), 2018, PCTA held its second Reddit AMA on r/CryptoCurrency subreddit, discussing BCH hard fork. Several well known public chains including Nebulas, NEM, NULS, BOTTOS, DACC and CoinXP also joined the discussion and contributed amazing ideas. During the one hour AMA, we have received nearly 90 comments, and more than 10.3Kpeople online at most. The above mentioned projects’ founders and co-founders shared their viewpoints with community members intensively, and ware warmly welcomed by community. For more detailed info please click HERE to visit our AMA webpage on Reddit. Still have other questions yet to ask? Please stay tuned for our next Reddit AMA.
Below is the recap of this AMA:
Hard forks divide a community, but I was also thinking they likely have positive benefits such as solidifying and energising the new sub communities. What are your thoughts on this, and do you think this is the aim of some hard forks?
ANSWERS:
Xxbc1 (Xin Song, Bottos CEO)
Hard forks is likely to happen when you have a significant update of the network. It may bring new features or new performance improvement. To certain extent, it will bring many positive benefits to the new sub communities.
SteveLi_(Regional Head NEM China)
I think occasionally hard fork encourages diversity in project community, but the price it took outweighs its benefits in three aspects:
- Hard fork separates genius and excellence apart. It will weaken each sub community in technology development.
2. Hard fork separates funding and liquidity, each sub community will face more violently price up and down and generally lower coin price at the end of the day.
3. Hard fork separates ecosystem apart, apps build on public chain will be forced to face the choice between two very important communities, giving up either will means great losses of users on another side.
That’s all. My suggestion: never go for a hard fork easily.
Benefits and loss are relative to different roles, it’s not necessary the loss to the whole ecosystem, on the contrary, it has possibility to bring new benefits to the ecosystem.
AeroWang (Nebulas Co-founder)
Objectively speaking, not all hard forks are necessary. These hard forks do not necessarily occur when the community really has large-scale incremental users, but often occur at the most difficult times in the community. We also saw many projects with hard fork that eventually lost developers and users and die. Take BCH as an example. If every upgrade of BCH needs to be at the expense of hard forking, it is undoubtedly that all users’ asset are paying for every upgrade. The upgrade is inevitable and the experiment always fails. This is “ crazy”.
What do you think about this BCH hard fork, shall you share your comments? and I think it would be evitable, what’s your opinions? Look forward to your reply.
ANSWERS:
xxbc1 (Xin Song, Bottos CEO)
The BCH hard fork is difficult to avoid. It’s a result from the battle between two forces. I cannot tell which one is good or bad.
AeroWang (Nebulas Co-founder)
Essentially this BCH hard fork is remaining issue from the BTC community, it’s highly likely that such hard fork might not be the last one. In other words, it is actually a fundamental governance issue on BTC’s consensus mechanism.
Regardless of what proposal each side is arguing, the real issue is that once there is contradiction over the future development of the ecosystem, we see little chance to find a feasible way to solve the imbalance of governance power among the developers, system maintainers (miners) and users (coin holders), .
Looking back at the BCH hard force, in my opinion, a good blockchain ecosystem should have two features:
- Information integrity. All participants of the system should have equal rights and opportunity to access information. Everyone, regardless of his role, should be able to receive the same level of onchain information at the same costs, through an open and transparent way.
- Rule integrity. Everyone in the system should have equal rights and opportunities to participate and compete. Regardless of their roles, everyone can take part and compete through unified rules, and pose their views and influence on the ecosystem at the same cost.
So in this way, BCH hard fork is inevitable, as the information and rules in the ecosystem is not integrated. Miners (mining pools) have super-power against the developers and the token holders, so the “consensus” of the ecosystem might be affected by the willing and desire of the superpower holders, and hence the “consensus” might be only the “consensus” of the one miners but not the entire ecosystem.
To put is in a simple way, if we image the blockchain ecosystem as a creature, even though there are thousands of different cells, and each DNA of each cell is the same. But all these DNAs would like to involve but to difference direction, it will be disastrous to the creature.
So in this way, hard forks are the “cancer” of the blockchain ecosystem, whether it is the BTC community or the current BCH SV& BCH ABC, if there is no information nor rules integrity in the ecosystem, the developers, the system maintainers (miners) and the system users (the holders of the money) each follow different rules in the “game”, like different DNA involves to different directions, then the hard fork cannot be avoided, regardless of how hard we try
Agree, extend to all blockchains, allowing bad-seeds to weed themselves out, and we will have a diverse ecosystem and technologies.
xxbc1 (Xin Song, Bottos CEO)
As an Pre-IPO company, Bitmain has a lot incentives to make more profit by upgrading the BCH network to the next version with more potential application scenarios. Bitmain holds many different ideas from the rest people of the community. As a result, the hard fork will happen sooner or later.
xiaomingHPB (Wang Xiaoming, HPB CEO)
As data speaks louder than words, let’s first take a look at the data. According to Bitman’s prospectus, it reduced its holdings by 15,000 bitcoins in the first quarter of this year, and increased its holdings by about 180,000 BCHs. The average exchange price was 0.082 BCH/BTC. If it was denominated in BTC, the loss was 27%. Moreover, that the Bitmain continues to convert bitcoin into BCH in the second and the third quarters, can be assumed that it basically has no bitcoin in its hands. With the collapse of BCH, the loss of investing BCH is increasing!
In addition, Bitman’s IPO was blocked and is now facing pressure from investors after receiving tens of millions of dollars of investment from Sequoia Capital and IDG.
From the very beginning, CSW said that it would do whatever it takes, even if Bitcoin fell to $1,000, it would have to win this war. Supposing CSW is really Nakamoto whom is said to have 1 million bitcoins. Then, in this battle, the value of CSW has lost nearly 1.5 billion USD. This kind of gameplay that does not hesitate to endanger Bitcoin causes loss for every one including itself. If not, his reputation will take its toll as it does harm to the community.
The fact that Bitcoin fell 20 billion dollars in 24 hours, causing panic and loss to the community has fairly shown that this a zero-sum game.
Hard fork indeed has appeared many times, but if we have more communication and tolerance for the development route, it is more likely to be avoided within the community.
CoinXP (CoinXP COO)
Both our team and I are looking at BCH hard fork this time as a positive evolution of blockchain ecosystem.
From our perspective, blockchain hard fork is fulfilling a diverse ecosystem of coins, which we should support. By examining the birth of BCH, we can see how this field cannot, and will not, be dominated by a single community. If more than half of the computational power of the bitcoin network is owned by one or a single group of miners, it will cause public trust crisis to the blockchain. The PoW consensus mechanism will inevitably lead to the centralization of computational power. It is only an illusion to rely on computational power to achieve fairness. Therefore even the politics behind BCH and bitcoin have engendered division, the two currencies can and should exist in the same realm and they contribute to a more balanced and diversified ecosystem.
AeroWang (Nebulas Co-founder)
The PoW consensus mechanism will inevitably lead to the centralization of computational power. It is only an illusion to rely on computational power to achieve fairness. Therefore even the politics behind BCH and bitcoin have engendered division, the two currencies can and should exist in the same realm and they contribute to a more balanced and diversified ecosystem.
Hi Kay, partially agree on the computational power issue, under such consensus, mechanism, miners (mining pool) will have more power over the developers and the system users (say the token holders). But might be earlier to say if it is positive or negative to the ecosystem at the current stage.
Specifically on the BCH case, you might be right, but in the long run, we believe hard fork is a common situation happened in an open-source decentralized community. And, the more decentralized, the more creative an ecosystem will evolve.
AeroWang (Nebulas Co-founder)
Hard fork is a long-last pain point, but there should be a option B to solve the discrepancy among community members :)
Is hard fork a problem that every public chain will face? What are the proposed technical and governance solutions for hard forks from some of the public chain projects?
ANSWERS:
xxbc1 (Xin Song, Bottos CEO)
Hard fork is not evil. It is almost inevitable for the public chain as it is one of the methods for network upgrading.
The key point for the public chain to consider is to avoid the ecosystem hard fork, not the technical hard fork. The hard fork proves the degree of the decentralization.
I think DPOS is one of the good solutions for the hard fork. So far I did not see any significant hard fork events in the DPOS public chain.
As the public chain team, the more important task is to coordinate the community to help players to make new agreements.
SteveLi_NEM (Regional Head of NEM China)
I think yes. NEM had been and will definitely be facing the issue of hard fork as well. We had some though situations earlier this year. Some community member proposed a hard fork to save exchanges from huge loss by hacking incidents, yet at the end of day, we respected the spirit of decentralization and stay together without a hard fork to save the day.
On the another hand, NEM has developed it second generation core engine “Catapult”, which uses a total different coding language with the first generation. It will surely means facing a hard fork issue when updating the main net. How to deal with this depends on the dev team and community’s wisdom.
In general, I am not a fan of hard fork for NEM.
Mai_DACC (SKY, Partner of DACC Foundation)
The hard fork is essentially a blockchain node that uses a consensus mechanism and protocol that is not compatible. There is a possibility of hard forks in each public chain. What we need to do more is to design a consensus mechanism from the perspective of incentives and games to avoid hard fork and community division.
AeroWang (Nebulas Co-founder)
An public blockchain project will definitely have different opinions on the technology and governance, and following on what I have mentioned above, if there is no information nor rule integrity in the ecosystem, the hard fork will be hard to avoid.
Being in the crypto-world for over 6 years, I had deeply experienced the pain point of hard fork, so when we designed Nebulas, we had seriously considered the issue of hard fork. Nebulas Force, which is one of the core capacity of Nebulas, is the featured design of Nebulas for better upgrading of Nebulas system.
(1) On the integrity of the governance, Nebulas has POD(Power of Donation) consensus to truly rewards the members who contributed a lot to the community, and allow them to decide the development of the project. Developers, system vindicator(miners), users(token holders) follow a unified rule on the operation of the whole system.
(2) Technically, we have set Nebulas core protocol components on mainnet and also build NBRE(Nebulas Blockchain Runtime Environment) to let the system upgrade automatically. The system will embed the upgraded protocol in the chain by special form of transaction after the community achieving governance consensus, thus to achieving slidely update of the consensus. In a word, we make the “governance rule” on-chain, and the rule for upgrading the “governance rule” are also on-chain, which can guarantee the integrity of the updating of the rule.
CoinXP (Kay Lin, CoinXP COO)
I think blockchain splits are a rather natural occurrence, as mining is decentralized and miners compete to build the ‘winning’ version of the blockchain.
Therefore, almost all the public chain will encounter forks being splitted from their original chain. This happened to Bitcoin and Ethereum. We shall be open-minded, allowing for hard forks to reduce the power of dominance and diversify the entire ecosystem so that we can cope with future uncertainties.
The traditional technical world is to apply for patent to protect their technologies, while in Blockchain world we embrace “fork” and “be forked”, it improves the technology unprecedented developed.
xiaomingHPB (HPB CEO)
It is. As for solutions, from the perspective of technology, we should keep forward-looking vision and security and reduce dissents caused by technical problems
From the governance perspective, to prioritize common interests and respect advice and feedback of the community, and to create a friendly communication mechanism that minimizes dissents.
It seems like differences in opinions about Proof of Work algorithms are at the heart of recent forks, could someone give their opinions on why staking is the best method and/or other means to avoid forking? Also when will the staking requirements/rewards for Nebulas be released?
ANSWERS:
longinus8941 (Nebulas researcher)
Hi, I’m researcher from Nebulas. I don’t think PoS like consensus protocols are the best. For example, in Ethereum Casper one should mortgage his or her token for a while and it will decrease the liquidity which is harmful to the ecosystem. And that’s why nebulas propose the PoD.
I thought Nebulas was needing to run a DPoS system until Proof of Devotion will be implemented?
The hard fork problem is fundamentally a governance problem. A violent community split is the inevitable result of any cryptocurrency without effective governance.
One solution is to use a PoS layer on top of PoW. PoS allows the user to agree on what the “real” project is. If this is enforced on-chain, it makes a hard fork without the consensus of users extremely difficult.
longinus8941 (Nebulas researcher)
That’s interesting and sounds like a delegated PoW (DPoW). However, I doubt that such 2 layers protocol will reduce efficiency of consensus.
Question to Nebulas. Do you think Nebulas Force you mentioned in the white paper can avoid hard fork?
ANSWERS:
xuepeng (Head of research in Nebulas)
Nebulas Force (NF) provides the ability of updating both blockchain protocol and smart contracts. I suppose we are talking about updating blockchain protocol here.
However, we believe that hard fork is about governance, instead of technique upgrade. NF is for technique upgrade, not for governance. NF can make the hard-fork more easier if hard-fork is the inevitable.
Personally, I think hard-fork is not that bad, so DON’T PANIC, :).
AeroWang (Nebulas Co-founder)
Absolutely, check out my previous reply, when we designed the white paper of Nebulas, we have seriously considered the pain point of hard fork, and Nebulas Force is designed for it. Moreover, in the coming Nebulas NOVA which will be ready by end Dec, we will have Nebulas core protocol components on mainnet and also build NBRE(Nebulas Blockchain Runtime Environment) to let the system upgrade automatically, stay tuned!
It’s going to do massive good for crypto as a whole.
It’s taught people not to buy any PoW coins which pay miners, because they all inevitably have a creeping tendency towards centralisation in the most efficient mining pools.
Decentralized protection against censorship and double-spends is the mostimportant attribute of crypto. Without it we might as well place “trust” in the SQL databases of banks.
Many PoW coins are mathematically perfect works of art- but economicallyflawed by their paid incentivizations.
Only a system which has no financial incentives at all can ensure all stakeholders motivations are identical — and purely aimed at the safety of the network.
ANSWERS:
AeroWang (Nebulas Co-founder)
It’s taught people not to buy any PoW coins which pay miners, because they all inevitably have a creeping tendency towards centralisation in the most efficient mining pools.
Decentralized protection against censorship and double-spends is the most important attribute of crypto. Without it we might as well place “trust” in the SQL databases of banks.
Many PoW coins are mathematically perfect works of art- but economically flawed by their paid incentivizations.
Only a system which has no financial incentives at all can ensure all stakeholders motivations are identical — and divided purely on the safety of the network.
Partially agree that hard fork led by miners (mining pool) may reflect issues on the PoW consensus, again, as I have mentioned, this a result that rules and governance power for miners , developers and system users are not unified, but incentive is the “soul” of blockchain ecosystem. We should seek to form a better rule but not to eliminate the incentive.
So in my opinion, we must solve the problem of who and how to motivate. PoW will not be the ultimate form of blockchain consensus, and other consensus will have the same completeness and mathematical beauty in the future. This is the next holy goal worth all blockchain projects working together.
Someone with some sense.
I encourage you to check out hybrid PoW/PoS systems, which maintain the benefits of PoW, while allowing users to have veto power over miners via PoS.
ANSWERS:
AeroWang (Nebulas Co-founder)
Thanks, Nebulas is working on our consensus of POD(Power of Donation), our goal is to truly rewards the members who contributed a lot to the community, and allow them to decide the development of the project. Also regarding the pain point of hard fork, we are seeking a way to let the system upgrade along with its operation and targeting to solve the hard force issue with Nebulas Force.
Technically speaking, we have set Nebulas core protocol components on mainnet and also build NBRE(Nebulas Blockchain Runtime Environment) to let the system upgrade automatically. The system will embed the upgraded protocol in the chain by special form of transaction after the community achieving governance consensus, thus to achieving slidely update of the consensus. In a word, we make the “governance rule” on-chain, and the rule for upgrading the “governance rule” are also on-chain, which can guarantee the integrity of the updating of the rule.
This function will be ready in Nebulas NOVA which will be launched by the end of this year, stay tuned and we are looking forward to hear your opinion on this part!
I don’t understand why split rather to sit together, align your thoughts and solidify your product|blockchain.
ANSWERS:
AeroWang (Nebulas Co-founder)
The blockchain technology is still in its early stage, so definitely people will have discrepancies on the path for the development of the project, but as I have mentioned, hard fork is harmful to the project and the community, we should have a better solution for the discrepancies, this is what Nebulas is trying to achieve with Nebulas Force.
Miners and mining pools played a very important role in BCH hard fork. Will this be the norm in subsequent blockchain projects? What are the impact of miners’ choices on the interests of crypto users?
ANSWERS:
xxbc1 (Xin Song, Bottos CEO)
Miners and mining pools are important parts of a public chain. There are couple major roles in the public chain ecosystem: miners, developers, users and traders. Miners and developers are the most important roles in the current public chain ecosystem.
Users and traders will play more and more important roles in the future public chain ecosystem as more Dapps are in place. The public chains pay little attention to user interests will be abandoned.
The choice of miners is no right or wrong answer. If the users don’t see the future value of BCH, they can just sell the coins. Therefore, I don’t think miners’ choices affect the users interests.
AeroWang (Nebulas Co-founder)
BTC is the earliest application of blockchain technology, and its survival is the primary requirement. Therefore, when designing BTC system, Satoshi favors “system maintainer” ( miner ) in terms of making the rules, while developers and system users ( token holder ) are excluded from the rule making. As a result, miners and mining pools have an absolute say in the future development direction of the system, but they do not necessarily pay attention to the vision of BTC’s technical development or the medium and long-term interests of system users ( token holders ). This is not to say that the miners have problems on their own, but the “ rules of the game” lead to the fact that they have different interests model with token holders.
CoinXP (Kay Lin, CoinXP COO)
The PoW consensus maintained by computational power relies on the miners, as the armies, and the mining pools, as the castles.
The blockchain technology based on open sources will evolve rapidly than ever. It is still unknown whether the PoW consensus will become mainstream in the future. The roles of the miners and mining pools will eventually become history.
xiaomingHPB (Wang Xiaoming, HPB CEO)
Miners are essential to occurrence of hard forks and this will become the norm in the future. As miners are also holders of the currency, their interest is consistent with that of other currency holders. However, some participants have hurt the interests of other currency holders for purposes other than the majority.
Ethereum has yet to switch to PoS. Is there a hard fork in Ethereum when it changes the consensus mechanism?
ANSWERS:
Mai_DACC (Partner of DACC Foundation)
Hey guys, this is SKY and I’m Partner of DACC Foundation (DACC: World’s First Digital Media Blockchain That Features Identity and Access Management (IAM) at the Infrastructure Level). I’m glad to be here today to share my views on blockchain tech with all of you. Here’s my view: Ethereum switching to pos may produce hard forks, just like the previous eth classic
xxbc1 (Xin Song, Bottos CEO)
As we talked above, hard fork is only one of the public chain upgrading methods. Ethereum has done couple of hard forks before. Thanks to V God, most of the players made agreements on the new version very quick. Therefore, hard fork is almost inevitable. The point is to make agreement as quick as possible.
As we all know, Ethereum planned four stages: Frontier, Homestead, Metropolis and Serenity. The last transition from Metropolis to Serenity is to upgrade the POW to POS.
I think this transition has a high possibility to be a smooth upgrade. The reasons are:
1) The transition is planned long time ago. Players in the community are well prepared compared to a sudden hard fork;
2) V God has a lot followers in the community;
3) A lot of technical preparation such as Difficulty Bomb and Casper……
I look forward to the result!
xiaomingHPB (Wang Xiaoming, HPB CEO)
I have been paying attention to the progress of PoS, which has been delayed by more than one year as originally planned. There are at least two reasons for this:
First, the PoS technology itself is not mature, so when Ethereum moves to PoS, the community will be concerned about its technology maturity.
Second, both PoS and PoW have a large number of supporters, which will directly lead to the formation of two camps in the community, laying latent danger for hard fork. For these two reasons, chances are large to see hard fork in Ethereum when it changes to PoS.
CoinXP (Kay Lin, CoinXP COO)
I think switching from PoW to PoS is the right choice as Bitcoin has showed that PoW mining on a large scale is not sustainable. However, this change may be complicated also as those involved in mining are likely to push back and to reject this change in order to protect their monetary interests. It may cause hard fork between old miners and large stake of ETH holders.
To be continue.
Thanks for all the questions and answers from community and our partners! PCTA will hold more Reddit AMA in the near future. So if you still have some questions or suggestions, please stay tuned for our official announcement. We’re willing to hear your voice!
