Ethereum and Bitcoin Cash: management of hard forks



Bitcoin Cash and Ethereum are both in the process of considering tough forks, but decision-making and communication processes are playing very differently: Ethereum's blockchain decisions seem to be largely decided by developer communities, while the Bitcoin community Cash lets the miners take the reins. The different priorities of each blockchain were at the heart of the matter.

Every relationship is different, with different structures of power and methods of communication. Likewise, each blockchain community defines the relationship between developers and miners differently, in a way that works best for them. In some, developers devise the code, but miners hold the bulk of decision-making power. In others, developers largely model the evolution of the protocol, and miners who reject such changes are mostly fired.

Of course, there are also blockchains where miners and developers operate almost completely in sync, governed by the same central entity. However, there is nothing particularly new or interesting in the centralized decision-making process: I am more interested in how decentralized networks manage authority, power and consensus building.

Bitcoin Cash and Ethereum do well to exemplify the different priorities at the center of two decentralized and divergent governance models.

Bitcoin Cash

The main purpose of Bitcoin Cash is to function as currency and reserve of value. Therefore, its priorities are a high level of security, fast transaction times and price. Therefore, development is mostly limited to these concerns. Cash is the king of Bitcoin Cash, and the miners put the new currency into circulation. Without the miners, Bitcoin Cash is nothing. It follows that they would have a lot of power, and they do it. It is also the case that, since the purpose of Bitcoin Cash's development is limited to a relatively small number of problems, it is possible for a single client to write the changes to the protocol by directing them, and so do.

Take, for example, the ongoing conflict around the upcoming hard fork of Bitcoin Cash. It started when Bitcoin ABC, the client that operated on two-thirds of the Bitcoin Cash nodes, published scheduled changes to the BCH consent protocol.

Craig Wright, Amaury Séchet's longtime opponent of Bitcoin ABC, did not like those changes. As "chief scientist" for nChain, he reacted by proposing a different set of changes.

Instead of communication, teamwork and all those nice things, the two clients are forcing miners to choose the parties in the debate. Still others in the BTC community are talking to other proposals. Everything is rather chaotic, but changes in this matter can be overcome fairly quickly. This type of power structure is also well aligned with the capitalist and libertarian ideologies shared by many in the community: it is sinking or swimming and the glorious power of the invisible hand. Niche communities of various kinds can simply shell out the blockchain and have their own space to do their own thing, no coordination is needed – let the market decide.

Ethereum

Ethereum, on the other hand, is supposed to become a world-wide computer, capable of robust flexibility. The ether must take something so that the miners are encouraged to participate and thus maintain decentralized security. In other words, creating money is not the only effort of Ethereum, just a means to an end. Effective coordination through a massive, decentralized network of individuals and groups developing complex and diverse initiatives is critical to the success of Ethereum. It follows that the developers, as a group, would have a lot of power, and they do it. It also follows that the community must be a bit more centrist, and it is so.

Consider the imminent gallows of Constantinople. It is an early and strongly coordinated fork in a series of strategically coordinated forks, all specifically designed to move to the creation of a fully scalable Ethereum as a world computer. Developers working in various Dapps, customers and independent groups, associations, advice, etc. They come together to synchronize efforts to ensure that all changes work in tandem and towards the vision of the network.

Developers present proposals for improving Ethereum and the community discusses (or sometimes ignores them). Customers weigh, defense groups like Ethereum's Wizards decide if they will lend their support, miners discuss how this will affect their profitability, and editors around the world argue. There is an entire structured system on how changes are proposed, commented, modified, tested and finally implemented.

Even now, while Constantinople is approaching and the community still has to decide which EIP on block premiums should be included, there does not seem to be any reason to believe that miners will reject changes, whatever they are. The community of programmers is too united in its efforts, so the only option for miners is to accept the changes or stop the extraction of the Ethereum blockchain altogether. Obviously, it must be said that the miners of Ethereum have bifurcated the chain into two previous ideological differences, creating Ethereum Classic. However, at this moment there does not seem to be such a rift.

Of course, there are disadvantages in this. Many inside and outside the community are frustrated and worried about the slow nature of the evolution of Ethereum towards scalability. Miners are worried about profits. Investors doubt the ability of the blockchain to succeed. There is a risk in any decentralized project of centralization or over reliance on a small number of developers.

In the end, it comes down to what you really want from the blockchain, and everyone has to decide that for themselves, and develop the type of communication and resolution of conflict appropriate for that purpose.


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