Weekend is coming, a moment of relaxation ~

We launched our Chinese podcast “Fork It” on blockchain technology, with four Nervos anchors Terry, Jan, Kevin and Daniel sharing aspects of blockchain from the perspective of front-line entrepreneurs. This is the first episode to talk about Fork.

Bifurcation is the block chain facing two roads, choose to go left or right? If you go left, you don’t have to do anything; If you go right, you are upgrading. — Bifurcation in Jan’s eyes

None of the big blockchain forks I’ve been through have been easy. Getting all nodes to upgrade to the latest client is difficult in itself, but consensus is hierarchical and needs to be reached among different groups. A fork where consensus is reached is called an undisputed fork, and a fork where no consensus is reached is called a disputed fork. — Split ends as Daniel understands them

It’s hard to reach consensus in a group, even in a group of 10 people. What’s more, with hundreds of thousands or millions of people in the blockchain, it’s hard to reach a consensus, so forks are a natural thing to do.

In Fork It 1, Jan and Daniel are going to talk to us about Fork.

BTC and ETH have different bifurcated worldviews

Both Bitcoin and Ethereum use the POW consensus algorithm. In POW consensus algorithm, when all the miners recognize the bifurcation of a is going to happen in the future, they will choose to download the latest client version contains the bifurcate, when reaching a certain block height, after all the nodes of the whole chain will use the latest version of the client, at this time, they will do a moment agreement to upgrade, then bifurcate will finish.

But the bitcoin and Ethereum communities have different worldviews on forks. The Bitcoin community is adamantly resisting any hard fork, while the Ethereum community is constantly hard forking. Why the big difference?

From the perspective of promoting community consensus, bitcoin does not have a core team to promote this, while The Ethereum community is a technology-driven community, including the Ethereum Foundation, the core team, and Vitalik, the spiritual leader of the community, who jointly promote the forward upgrade of the agreement. Ethereum will reach consensus much more widely and quickly than Bitcoin.

As a store of value, Bitcoin needs to be stable enough, which is one of the reasons bitcoin is resistant to hard forks. Ethereum appeared after Bitcoin. In order to develop and progress rapidly, it needs continuous iteration and upgrade.

Each ethereum fork has a lot of local disputes, but before the fork, the Ethereum community resolves these protocol differences on a technical level, which is a good model. If you are a developer, you will be familiar with the operations of the open source community, such as Linux and Rust. They all have a core organization, where people constantly make proposals and discuss to form a result. Finally, the core team will promote the implementation. Although the decision making efficiency of the open source community is slower than that of a centralized organization, it still reaches a consensus on the technology first and then on the upgrade of the network protocol. It’s a logical process and a good balancing act.

POW forks and POS forks

The forks using POW consensus mechanism are mostly voted according to the number of votes held, while the forks using POS consensus mechanism are simply voted based on the number of stakes held by the blockers. Of course, there will be more challenges and gameplay in the setting of the voting mechanism. In a POS fork, it can be set up so that all Stake holders vote, or even instead of holding Stake votes, it can superimpose other voting mechanism designs, such as sacrificing liquidity to get more votes, assuming 10 tokens, locked for 10 days and 100 votes, Lock in 20 days, 200 votes and so on.

In fact, consensus and governance are two different dimensions. POW forks can also be voted in the form of Stake, and POS forks can also be voted based on the number of votes held.

BCH forks due to expansion battle

There have been many interesting forks in history: The BTC expansion battle, The DAO incident in Ethereum, The Byzantine fork, The military Tentinople fork, The BTC fork, and so on.

The BTC fork BCH occurred in August 2017, when a group of companies, led by BitMain, proposed a bitcoin-based improvement that would not result in a consensus but in a new chain forking out of Bitcoin. By applying a series of proposed expansion solutions to the chain, including upgrading the capacity of each block from 1M to 8M, you have BCH (Bitcoin Cash), a completely new chain.

The fork is a major debate about the route to blockchain expansion, mixed with various community differences. The reason that scaling up is a problem is because bitcoin’s bandwidth is running out, and transactions in each block are too congested. According to Satoshi nakamoto’s paper, the storage limit of the bitcoin block is 1 meter, which can accommodate only about 6 or 7 transactions per second on average, so the bitcoin network congestion problem has been very serious since 2015. Since then, there have been calls from the community to expand, and different views on how to expand.

Fundamentalist as it may be, BTC has a point in arguing that the parameter of 1M cannot be changed. The Bitcoin Core first chose to use an isolated witness to remove the space occupied by the signature portion, so that the actual available space of the block becomes larger from 1M. The next step of expansion will be discussed after the isolation witness deployment, and the Layer 2 or Lightning network solution will be used to make up for the lack of bitcoin performance.

In an ideal world, however, the isolation has seen a 170% increase in capacity, but it does little to address network congestion. And with current bitcoin technology, using Layer 2 on top of Bitcoin to expand the performance is also a long process.

Some thoughts on the hard fork

When opinions disagree, the end result is one of two things. One is that everyone agrees to go left or right, and there are no hard forks. The other is that there is no consensus and each sticks to his own point of view.

In the traditional case, the general system is the majority or a decision by one person, and the bifurcation proposed another system, each can go their own way. All the data in the blockchain can be replicated, and restarting a chain can go from 1 Token to 2 tokens without even having to vote by the user. A lot of people were surprised when they saw that a dollar in their hand suddenly became a dollar and another dollar.

BCH fork is a successful fork, and has been accepted by many companies and applied to many scenarios. After that, there were many forks, such as BTG, Bitcoin God, SBTC, etc., but these forks did not succeed. This explains the phenomenon:

In the Internet era, the barrier of Internet giants is users. Startups can copy products and business models, but they have no way to acquire users. In the era of blockchain, it may seem that all users on the original chain can be obtained for free by copying the code, but in essence, it is not so easy. Users will not necessarily migrate because of the fork, but need to see the value on the chain to make a choice. What this value is is what entrepreneurs need to explore in the blockchain era.

Pick Time

At the end of every Fork It episode, the hosts send in their goodies:

In this issue, Jan recommends a book called Debt by David Graber about the history of markets, money, and debt. This book is full of interesting ideas and is well worth reading.

Daniel: I recommend the German roast pork elbows in Prague. In November, the Nervos team attended Devcon4 in Prague, where they shared a full roast pork elbow with a pint of stout.

This article is based on Fork It 1. Fork It, the first Chinese podcast to talk about blockchain technology. For more exciting content, see the link: http://forkit.fm/1