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Bitmain Clarifies Its ‘Bitcoin Cash’ Fork Position

Last Updated March 4, 2021 4:58 PM
Lester Coleman
Last Updated March 4, 2021 4:58 PM

ViaBTC, the Chinese digital currency exchange, recently announced support for trading a new bitcoin fork called “Bitcoin Cash” (BCC), based on User Activated Hard Fork (UAHF), which Bitmain proposed in April.

Bitmain, in a recent blog , noted that it proposed UAHF to protect the bitcoin ecosystem from the BIP148 fork, known as User Activated Soft Fork (UASF).

Bitmain noted that BIP148 continues to gain support, including from Bitcoin Core developers. Bitmain claims BIP148 poses a significant risk to the bitcoin ecosystem, hence the need for a contingency plan.

Attack Continues on New York Agreement

Bitcoin Core software developers also continue to sabotage the New York agreement, the blog noted, an agreement supported by more than 80% of the hashing power and 80% of the transactions source software in order to scale bitcoin quickly.

Under BIP148, its nodes will begin to orphan bitcoin blocks not signaling Bit 1 at its UASF forking point after August 1, Bitmain noted in another blog . BIP148 nodes will follow the new BIP148 chain if there is more than zero hashing power supporting it. If the hash rate is zero, the BIP148 nodes will find their chain cannot extend.

Mining activity behind a UASF chain could halt without notice, and investors could lose all their investment, Bitmain claims. Exchanges that support a UASF token following the forking point must consider the stagnation risk it brings.

The BIP148 chain also has no replay protection, according to Bitmain. Transactions will be broadcast to both chains and users will not prevent confirmation on both chains. The exchanges will need to halt deposits and withdrawals at the forking point, then deploy their own coin splitting methods.

The UASF poses a risk to the original chain. Without a contingency plan, activity on the original chain could be eliminated.

Bitmain Is Ready

Bitmain will only deploy UAHF if the UASF fork occurs and presents an imminent risk to the ecosystem.

Bitmain also noted that software developers at the Future of Bitcoin conference in the Netherlands proposed Bitcoin ABC, a software for increasing bitcoin’s block size that replaces the SegWit code with an adjustable block size cap.

Supporters of bitcoin’s block size increase now lead the development of UAHF, Bitmain noted, adding that it does not control supporters opinions.

Bitmain Clarifies ViaBTC Relationship

Bitmain has offered the following clarifications of its position.

1. ViaBTC and Bitmain have only a shared investment relationship whereby ViaBTC operates independently. ViaBTC’s founder has 10 times the voting rights of ViaBTC investors. Hence, ViaBTC’s position does not represent Bitmain’s.

2. The New York agreement represents the global bitcoin community. Bitmain has actively supported SegWit2x’s deployment, and will continue to run the btc1 software on its mining polls, such as ConnectBTC, Antpool and BTC.COM in the near future.

3. Bitmain continues to monitor the BCC movement and does not discount supporting both BCC and SegWit2x.

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