Roger Ver, one of the most prominent Bitcoin Casher, has called off his support to fund BCH developers through 12.5% of mining block rewards.
“We think it is clear that the existing proposal does not have enough support, and we will be working to come up with a plan that is profitable for all the relevant parties and which preserves the fundamental economics of Bitcoin Cash,” Roger Ver’s company said.
This u-turn comes after an anonymous alleged spokesperson for un-named small miners said:
“We will in the short term launch a competing BCH pool to offer a voice to miners that disagree with the proposal. We will voluntary donate a 1% of our income to development teams while offering a voice to our miners on how to donate it.
Assuming the proposal is not withdrawn, or modified to be acceptable, we will continue to mine up to the hard fork, which will create our own chain.”
This miner attacked BTC.TOP, which spent an estimated $10 million to mine the first BCH block, by claiming BTC.TOP has been playing the difficulty adjustment algorithm (DAA).
Conveniently Bitcoin Unlimited (BU) also doesn’t like DAA, an algorithm that changes the difficulty to adjust by block instead of every two weeks as the latter was making block times fully hectic.
Furthermore, the similarities between this anon miner and BU do not end there because shortly after the miner’s statement, Andrew Stone, the maintainer of BU, said he intends to “disallow any coinbase tax in the Bitcoin Unlimited full node with the effect of forking from any blockchain that requires such.”
What is Going On?
That Bitcoin Unlimited does not like this proposal was somewhat obvious and to be expected as they don’t like Bitcoin ABC.
Threatening a chain-split, however, is quite something, but far more interesting are the actions of Roger Ver.
BitcoinXio, second in charge after Ver on r/btc, publicly said very early on that he was against the proposal.
Xio works for Ver if we’re not mistaken, so publicly stating early on he was against makes it curious.
Jonathan Toomim, an actual small miner and a dev, has now come out in favor of “compulsory payment from miners to developers.”
What Ver is really in favor of, however, is not too clear, and is not too clear because there’s a bit of background in as far as he claimed he donated $500,000 to ABC which turned out it isn’t fully true.
That’s after he asked ABC to make some technical changes to the protocol, so leading to a public back and forth in what we think was a proxy “debate” about money.
Who asked who first, or what, isn’t too clear, but you’d think Ver was perhaps expected to donate to ABC, with his answer perhaps being the request for these changes, with it so going back and forth until miners came up with this proposal.
Had all the signatories to that proposal made an updated statement together, then these recent events might have not been too interesting.
That’s because the initial statement lacked much detail, so an update was to be expected. The quick and seemingly unilateral action of Ver, however, raises the question of whether he was in favor of this proposal at all and whether he wants to fund development, ABC specifically.
That’s an interesting question because Ver has set himself up into a significant position where he controls r/btc, he controls a mining pool, an exchange, a site, an app. So if there was a chain-split between ABC and BU and he backs BU, then things would get very interesting.
It’s not clear what other miners plan to do now. Nor is it clear what Ver plans to do because he has not put forth a new proposal save for stating:
“In venture capital, investors do not find talented technical individuals and hand them money to ‘do something.’ Rather, those individuals put together business plans with clear roadmaps, timing estimates and resource requirements that allow the investor to make rational decisions with their money.”
Investors. Why they wanted it to be compulsory might now make more sense because the other miners most likely do not see themselves as VC investors, but probably see the dev protocol funding as the cost of mining from which they make a profit.
This demand to further put together some “business plan” is probably just another way of shelving this thing for some time, with it potentially further opening arguments in regards to for example how much does developing Schnorr signatures costs, whether it is too much or too little, whether it is needed at all, and all of this in public with Blockstream’s and BSV’s supporters keen to find every little bit and twist it, joined now by BU too.
A split however is probably not worth it over this, with some BCH supporters persuaded by the argument the proposal centralizes.
The problem is that if this is centralizing, then what isn’t? The suggested answer is donations, but that’s what’s led to this problem of no money for protocol devs, a problem that continues because Ver for example still hasn’t donated even after admitting his claim that he gave ABC $500,000 was not fully correct.
He is now stating he wants to have devs on a “tight leash,” arguing just donating money is “a sort of universal basic income.”
What he’d call the “donation” of time and skills by devs is not clear, but if we analyze on his own terms then the devs need to set up a company and get investment perhaps from people like Ver or whoever wants to invest with the devs keeping more than 50% of the equity so that they can’t be bossed around.
Otherwise without skilled coders that have the resources to do what needs to be done, then this coin risks becoming irrelevant because bitcoin has a lot of devs doing quite a lot of cool stuff, as does ethereum. So BCH won’t be able to even keep up, let alone be an actual challenger.
Some in BCH however take the view that nothing needs to be done at the protocol level at all. That what’s needed is “adoption,” that presumably arises magically in a competitive space where there are many choices, two of them able to make BCH instantly relatively irrelevant.
An increase in on-chain capacity in BTC, for example, can make BCH less attractive if it isn’t keeping up. An increase in considerable capacity in ethereum, in addition to their plans to reduce inflation to near zero, can likewise make BCH more an afterthought.
This block funding however clearly appears to be controversial, but no one has quite come up with an alternative in what is now perhaps a crisis in BCH.