1Hash Bitcoin Pool Comes out against Bitcoin Unlimited

While it briefly appeared that Bitcoin Unlimited might actually activate, the chances now seem slim as a relatively new bitcoin pool, which has suddenly shot to around 8% network share, appears to be very much against Bitcoin Unlimited.

1Hash publicly posted on China’s version of twitter where they stated, according to a very rough translation, that “BU has violated the BTC consensus agreement.” They further say:

BU intends to divorce from the current situation, to create their own basic principles of Bitcoin, that is – a hard fork, Bitcoin will also be split. BU hopes to have larger blocks, which means that a large pool can get more benefits from it, so it is easy to lead to the centralization of Bitcoin mining, the fee will be higher.

It’s the usual talking point (except for “the fees will be higher” which is a fairly puzzling statement), but in support of their argument they use the ethereum example which last summer underwent a hardfork to prevent a theft of some $200 million. According to a translation obtained by CCN.com, 1Hash says:

“Ethereum, with its smart contract functions, has attracted wide attention. At its peak, price rose continuously and it became the runner up currency, next to only bitcoin. However, it was attacked by hackers and had no other choice but to adopt a fork. Therefore, its price crashed drastically, never returning to its peak value even today.”

That last sentence is factually incorrect in an objective way that cannot possibly be disputed. Ethereum has this spring nearly tripled from the highest price it had before the fork last summer, with its market cap before the fork standing around $1 billion while now it stands above $4 billion.

Ethereum’s historic price. The pointer stands on the hardfork period – image from cryptowatch

I briefly spoke to 1Hash’s owner who did not answer my question of whether they will signal for segregated witnesses (segwit) or Bitcoin Unlimited, but was willing to inform our readers that the pool has no hashpower of its own. They further say they support a capacity increase, but not a split.

It’s not clear how strongly 1Hash’s views are held, but if it is on par with BTCC or Bitfury, the dynamics regarding bitcoin scalability may change. Bitcoin Unlimited may find it much more difficult to reach an overwhelming majority of hardware share, with the continuation of the stalemate much more likely, perhaps into 2018 or maybe even later.

Featured image from Shutterstock.

Last modified: March 4, 2021 4:55 PM

Andrew Quentson: Feel free to contact me at andrewquentson@gmail.com with any information you may have.