Ethereum Premine
Could the Ethereum community fork the code and leave the original developers out in the cold?

Concerns around the Ethereum premine seem to be one of the causes of the delay in launching an official IPO for the project. Finding the right funding model for any kind of free and open source software is always difficult because someone else can come in and start a new project by forking the source code. These issues are also compounded by regulatory concerns when actual “shares” in a new currency are going to be distributed to early investors. Some people who are upset with the original funding model proposed by the Ethereum team have claimed that forking Ethereum is not something that should be completely dismissed. In fact, this seems to be something that a few people on the Ethereum subreddit are already talking about right now.

What Would a Fork Entail?

The main reason that some people are thinking about forking Ethereum is they don’t want there to be any kind of premine for the developers. Premining has a rather negative connotation associated with it, but it’s not really a bad thing when done correctly. While Satoshi did not have to worry about being unable to snatch up bitcoins through the regular mining process after he released Bitcoin onto the world, the fact of the matter is that there are plenty of miners looking to mine ethers as soon as possible. If Satoshi were to release Bitcoin is today’s environment it would have been much harder for him to get rewarded for creating the Bitcoin protocol. Getting angry with a premine that goes over the top is perfectly understandable, but does anyone honestly think that Satoshi should not be rewarded for his gift to humanity? With more recent projects, such as Mastercoin and NXT, a premine was basically required to either create the initial coins or simply fund the development process. I’m a strong believer in the old saying, “You get what you pay for”, and I think joining an Ethereum fork without a premine would basically be like paying less for anything else that you buy on a regular basis. When you reward the original creators or producers of a product or service to a lower degree, you’re going to notice a decline in quality.

Why Ethereum Should Not Worry About Forks

Yes, it would be possible to fork the Ethereum source code and start a new project, but the problem with that idea is the new project still needs to a have a competitive advantage over the original Ethereum protocol created by Vitalik, Charles, and the rest of the core developers at Ethereum. The reality is that there is going to be much more value behind the original Ethereum project with the original developers of the protocol. This value is then compounded when you add in the idea of Ethereum raising money through an IPO to fund the development process. The premine actually serves a purpose of giving the developers an incentive to continue building on top of Ethereum and allowing them to be rewarded for creating the protocol in the first place, so it’s unlikely that a fork of this project will actually be able to gain popularity. As long as the team behind Ethereum are able to come up with a fair and balanced funding strategy, there will be no reason for the Ethereum community to fork the project.