Hello Steemians! We saw a big decrease in cryptocurrencies price across the board a couple of days back. Many people are attributing the decline to the infighting within the Bitcoin Cash community. I am more of person who believes that market movements are generally random and most of the time irrational. The mass media just like to find reasons (usually after the fact) for market movements. That being said, the Bitcoin Cash infighting does worry me a little as it demonstrates how fragile crypto communities can be and how centralized hash powers can potentially bring harm to projects based on Proof-of-Work (PoW).
A Little Background
15 November 2018 was the date planned for the hardfork of Bitcoin Cash. There are 2 camps, namely Bitcoin Cash ABC and Bitcoin Cash SV (Satoshi's Vision), involved in this hardfork and each of them wants to make different changes to the protocol. There is a Reddit post which summarizes the key differences between the 2:
ABC introduces some changes to protocol that increase Graphene block propagation technology performance by 700% and are a groundwork for parallelization of validation. Also a new OP_CHECKDATASIG operation that enables some interesting capabilities like doublespends forfeits.
SV bumps the constant from 32 MB to 128MB for block size limit despite stress tests show the ecosystem struggles even at 32MB. Also reintroduces OP_LSHIFT, OP_RSHIFT, OP_MUL, OP_INVERT but the first two work significantly different than the original opcodes so it's not quite reintroduction - rather replacement. There are also SV plans, promises and threats beyond this fork that are so far only tweets and articles from Craig S. Wright: stealing coins of people that split their coins with OP_CHECKDATASIG, stealing burnt coins, stealing lost coins, removing P2SH addresses, patent lawsuits.
ABC is favored by personnel like Roger Ver, Wu Jihan and John McAfee. While SV is led by Craig S. Wright. Due to these differences, and both wanting to be the "true" Bitcoin Cash post-fork, there is a possibility of a Hash war between the 2 camps.
Hash War
Source
Bitcoin Cash is a PoW system which relies on computational power or hash power to produce blocks and sign transactions. Therefore, whichever side having the highest hash power will be the "true" Bitcoin Cash. Craig Wright, with the backing of Coingeek, is said to have enough hash power to launch a 51% attack on ABC. If the attack is successful, it can cause catastrophic outcome to Bitcoin Cash ABC network and potentially causing it to rollback transactions.
As a result of this potential threat, the supporters of Bitcoin Cash ABC loaded up their arsenal of hash power by transferring their hash power from mining Bitcoin to Bitcoin Cash ABC. By doing so, it causes a lose-lose situation where miners of both Bitcoin Cash ABC and SV would have been better off mining Bitcoin. In fact, at the point of writing, it is 73% more profitable to mine Bitcoin.
To me, this is totally illogical and they are behaving like school kids fighting over toys. I fully agree with this Tweet on this topic,
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What's Next?
The Bitcoin Cash infighting is now a game of chicken with millions of dollars at stake. Both camps are losing millions daily in terms of opportunity costs. The market fears that if the hash war deepens, both camps will start to sell some Bitcoin to continue the war, thereby resulting in more downward pressure to Bitcoin price.
Again, I think it is difficult to predict what is going to happen. My thoughts are that if this infighting is going to prolong, it may bring some opportunities to other altcoins that are making progress. I read a very interesting article today on Traki, a major departmental store in Venezuela, started to adopt cryptocurrencies.
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I will like to remind everyone that progress is still being made and fundamentally cryptocurrencies are getting stronger in terms of technology and adoption. Personally, I am focusing on quality projects and investing in cryptocurrencies that are slowly gaining adoption.
What are your thoughts on the Bitcoin Cash hard fork? Share your views with me. If you like what you read, do give it an upvote and give me a follow. Thanks for reading!
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