The newest and the oldest digital currency has successfully increased its capacity to 32 MB, allowing the network to handle around 10 million transactions a day at 100 transactions per second.
The successful upgrade was completed yesterday without any problem. The new features had general agreement, so the old 8MB chain has been discarded with all moving to the 32 MB chain.
With Bitcoin Cash currently processing only 20,000 transactions a day at around 80kb per block, why bother increasing the blocksize further, some wondered.
The main reason may have been to give some certainty. Businesses can now be sure that if they move their project to BCH, they’ll have plenty of capacity, at least for some time.
Whether the network will ever reach that level of 32 MB does remain to be seen considering other competition. Yet bitcoin cash remains quite distinctive, perhaps even in a fundamental way.
The Bitcoin Core network, of course, is betting on second layers, like the invoicing Lightning Network system. Ethereum is to use such second layers, but in addition it will implement sharding to allow for on-chain capacity of 100 million, scaling quadratically, therefore may go up to half a billion or even an entire billion by 2025.
Bitcoin Cash is not working on second layers for now, but they’d be happy to have them for optional use. They’re not working on sharding either as far as we are aware and we’re not sure whether they can tackle that very complex problem for bitcoin cash. Their approach is instead to simply increase capacity by increasing demand on nodes.
That approach can work for up to 10 million transactions, although it would place the network under strain. To get to 100 million, they would need 320 MB blocks. With common internet speeds now at 200 MB/s, arguably you can get it to there even today, but it would come at a significant cost. For half a billion, blocks would need to be 1 GB every ten minutes. At that level, only miners and exchanges would be running a node.
There are different ways of measuring decentralization and the schelling point for some is whether a laptop can run a node. That’s slightly abstract. Our measure of decentralization is whether a developer can provide to the public for a public blockchain the same choice it was provided when bitcoin cash went live on August 1st 2017.
That is whether a developer of a reasonable income, say $50,000, and therefore of reasonable resources, can run a node with the aim of forking the public blockchain so as to create a new, almost identical, network.
You can say this developer can be sponsored and so on, but he or she shouldn’t have to go around begging. Nor should they have to collude with miners or anyone. They should have the freedom, independently, to code it and launch the new node with their own resources.
That’s because without that freedom to fork the network can be hijacked. So while technically there is no scaling limit, practically there is if the network is to remain trustless, and that limit is whether someone of an ordinary income can run a node if he or she wants to.
At 32MB, perhaps, at 320 MB, probably not, at 1GB, certainly not, at least with current tech, and perhaps even tech foreseeable for the next five years. Which is why the long-term plan was to shard the blockchain.
However, diversity is security, so these three different approaches may increase resilience and experience, allowing us to see just how each works.
Beyond scaling, the upgrade has also re-instated a number of OP_Codes or has given them more capabilities than they had.
As you can see, it is fairly limited, but there are additional things you can do with it as we’ll probably see in the coming weeks and months.
There is currently however a lack of tutorials or walkthroughs explaining how you can use any of these OP_Codes or what they can do in a hands-on manner. But they’ve just gone live, so it’s to be expected.
One thing you can do and we’ll probably see fairly soon is tokens running on BCH. They’re a somewhat different sort of token than in eth, but anything that gives SEC a bit more headache in classifying all these different sorts of tokens in a fast moving and highly innovative field is fine by us.
We do hope, however, that BCH coders have learnt from eth coders. Any mistake here is irreversible, and for BCH the network probably won’t even have a choice as it would need a rollback, which won’t get support.
If there are any protocol level bugs or exploits then they’ll probably just be addressed, but we don’t expect them to be exploited for PR or political reputational gains any longer, not least because it would backfire as the media won’t easily be able to differentiate between bitcoin and bitcoin cash.
Primarily, however, it’s because the debate is pretty much over, and though kids still continue arguing, grown-ups have moved on. It wouldn’t surprise us therefore if some Bitcoin Core devs even play with these OP_Codes in a genuine manner.
That’s because bitcoin cash is closest to bitcoin than any other public blockchain, including in a fairly direct manner as they share same holders prior to August 1st. Undoubtedly some of those holders are Bitcoin Core developers, so they’d probably have more vested interest in seeing BCH do well than otherwise.
Not least because the two have co-existed and can continue to co-exist. They can even engage in co-operative competition. Now that’s something that might be more difficult to achieve than getting Palestinians and Israelis on the same table, but we can foresee it and we can see little reason why they shouldn’t literally or metaphorically shake hands.
There are many subjective speculations to be made about that big debate between 2015 and 2017, but ultimately, that debate begun in 2009. Which means many genuinely held different views.
Now with those different views having their own united chains, there is no longer any reason to throw stones from glass homes. The two communities need to reconcile, or at worse, need to just ignore each other. Otherwise they will both continue to lose mindshare.