Bitcoin & Crypto & NFT News
I am a native English speaker but I have worked as a professional Chinese linguist for the past five years. I believe I have caught most of the idioms and intonations and I believe this conveys the meaning of his message well. I also welcome suggestions from native Chinese speakers.
Recently the BU and hard fork topic has been heavily obfuscated. Both sides are sticking to their guns and the arguing has become unbearable. Everyone claims that their own ideas are line with Satoshi’s vision, and everyone believes that the other side’s plan will lead to the perils of centralization. On the surface, it appears that all arguments are founded in idealism. But are they really? In actuality, the conflicts at hand are ultimately the result of profit seeking. The tail is wagging the dog. This fellow (referring to himself) is now going to make a couple of observations about the community’s diverging interests and analyze what the significance of those differences is.
In regards to the fork issue, the heart of the conflict lies with the distribution of the fees for a given transaction and whether they should be handled by the miners exclusively or if they should be spread out (to a second layer). Up until now every transaction on the Bitcoin network has been handled by the miners, and all fees have been given to miners. From the standpoint of rational self-interest, it is only natural and obvious that the mining community is satisfied with this arrangement. However, this situation is likely to be disrupted by Bitcoin developers building lightning network and side chain layer two protocols. If a second layer comes to fruition, many Bitcoin transactions will be facilitated through it, thus bypassing miners, and ultimately resulting in them receiving less fees. It is obvious that the mining community wouldn’t be happy with this type of change.
If this is to be the general state of affairs, with the developers producing functions that only serve the users, then users will exercise these functionalities, and the miners will have no way of stopping it. However, the current circumstances in bitcoin are subtle. God (or perhaps Satoshi) has given the miners a blocking instrument. This ‘blocking instrument’ is the malleability loophole. This bug has inadvertently become developers’ largest obstacle in producing new functionality. By not removing this bug, developers’ second layer protocols will be hard to implement. The fix to this bug is segwit, but implementing this type of plan requires the mining community’s support.
In other words, transaction malleability has become the mining community’s first line of defense, a passage ((of a mountain range)) that can be guarded. Holding this point alone will strangle the development of layer 2 protocols, preventing transaction fee revenue being spread to outside of the mining community.
Rational self interest is human nature. Moreover, in order to win customer support, many layer two protocols such as the lightning network are exaggerating the functionality and benefits, and saying nothing of the limitations and shortcomings. This further exacerbates the miners’ fears. Therefore, the miners coming together to boycott segwit implementation to guard transaction malleability is the first line of defense.
Blocking the fixing of a bug, on an emotional level as well as a logical one, is not appropriate. These miners know this in their hearts. That is why they do not bring the issue to attention and are not willing to clearly articulate their position. From their perspective, a relatively compromising strategy is to delay segwit and promote on-chain scaling.
Why would they promote on-chain scaling you ask? Because if the on-chain fees are kept to within a reasonable scope, the user’s attraction to second layer protocols wouldn’t be as great.
This issue is similar to global oil supply. In the past, OPEC enjoyed monopolization of global oil supply. After the price exceeded $100 per barrel, innovators developed new technologies such as shale extraction, and damaged OPEC countries. If beforehand OPEC kept the price point relatively low, such as $50/barrel, shale wouldn’t have been nearly as attractive, and it is very likely that it wouldn’t have been developed to such a large scale. Now shale has become the norm, and traditional oil-producing countries, even when they let the price fall to $30/barrel, cannot destroy shale. This has created an unfavorable situation to oil-producing countries. Miners are afraid of exactly this type of phenomenon.
In summary, while the fork issue is seemingly due to ideological differences, the fact of that matter is that it comes down to money. If we want to solve the problem, we must stop yelling at each other over ideological differences and about who is right and wrong. Using the spectre of centralization and inciting anger among users is not the way to solve this problem.
If we want to solve the problem, let’s talk about the real issue, money, and how the profits (of fees) should be divided. The miners do not want to strangle developer’s approaches to producing new functionality, and the developers’, in designing those new functionalities, must promote defending the profits earned by miners. It is only then will Bitcoin be able to reach the moon!