Effective rescue - sidechains

14.04.2016

After launching Bitcoin Classic the debates on possible extension of a standard block-size became more intense. Such a protocol organization represents a significant modification and implies a fundamental change in functioning principle of the cryptocurrency’s unique ecosystem.
Network management modification is considered as one of the key aspects in client software. According to the statement of the developer Gavin Andresen, such dissent becomes clear from the discord in management. It is necessary to make changes in the mechanism of introducing innovations into Bitcoin ecosystem. The discord is in relevancy of this aspect.

Armstrong, CEO of Coinbase, announced possible implementation of a hard-fork as one of the key solutions. However, this can cast doubt not only on Bitcoin, but the entire system of financial payments. If miners vote for implementation of new modifications into the protocol, Bitcoin will lose the status of financial freedom bastion. Most likely the system will be under control of not only mathematical character.
 
Finance system of Bitcoin
Digital cash is considered as one of the major advantages of Bitcoin. Cryptocurrency is based on complex mathematical and cryptographic algorithms. As was said earlier, the main constitution of the system is its code. Consensus of 95% of miners will allow promoting any decisions. This is one of the key factors required for supporting Bitcoin as a finance system.

Thus, 95% activation won’t allow implementing modifications into consensus procedure. This way Bitcoin will keep its initial task offering efficient payments. Besides that, cryptocurrency controls credit and financial policy opening access to efficient protocol updates.

The system has not been always operating guided by the terms of general consensus and protocol modifications. Democratic character of Bitcoin is not notable for its maximalism rather for its comparable nature. Initially Satoshi Nakamoto (the developer of the cryptocurrency) controlled the system as a generous dictator. Then Gevin Andresen undertook his responsibilities. This happened when the founder of the system has suddenly disappeared from the financial horizon. In the situation with BIP 16 around 55% of power will be required for fork activation. One of the major participants of the discussion is Mark Friedenbach, one of the founders of Blockstream. He states that such a function cannot be considered as “sufficient”.
According to Friedenbach, they are jammed with this problem because Andresen has decided not to wait for consensus. System kernel cannot already be considered as a “generous dictator”. It happened at the moment when Wladimir van der Laan had joined the project.
 
The main concern for Bitcoin is influence of politics
A group of developers (supporters of Bitcoin Classic) tries to modify the form of management through using hard-fork. Its implementation will contribute to expansion of the maximum block-size up to 2 Mb. Hard-fork can be activated with voting threshold of 75%. Reconsideration of existing standards is not anticipated by the conservative group, represented by Bitcoin Core specialists.

Andresen and Garzik take up leading positions in Bitcoin Classic. It is no wonder that they consider an activation threshold of 95% as unreasoned. According to Andresen, the threshold of 75% is a perfect solution for vetoing modifications in consensus procedure. Garzik went further announcing that 95% threshold means that to block consensus it is necessary to use over 5% of network power.
Moreover, he has implemented modifications into Bitcoin Classic system on Github. It led to increase in activation threshold for hard-fork up to 80%.

Does Bitcoin Classic represent a classic example of a political attack due to applying 75% activation threshold for hard-fork? G. Moris, a former CEO of WizSec, is one of those who highlighted and announced this aspect. He conducted an investigation on missing finances on the well-known cryptocurrency exchange MtGoх; upon completion of the research he made the following statement for Nasdaq:
Bitcoin system has been founded in order to eliminate requirement for third parties’ services. This phenomenon shouldn’t turn into an element of political dictatorship or democratic instrument. Especially in the situation when hard-fork supporters can implement various methods for satisfying their personal ambitions.
The existing standard of considering by Bitcoin-society the initial protocol more than once has proved its viability and capability of solving problems of network scaling. Unlimited possibilities of the blockchain, use of sidechains, as well as development and implementation of new technologies represent a practical solution for the current situation. Bitcoin shall not become an instrument for shady political insinuations.
Some skeptics note that the cryptocurrency shall not follow the example of underprovided fiduciary money (for example, USD) that represents an integral part of the vicious system of total monetary control. Bitcoin is far from politics and shall remain independent.

Impression is made that Bitcoin Classic won’t be capable of activating hard-fork. Mining companies and system representatives defend Bitcoin Core with might and main.


Effective rescue - sidechains
Blockstream promotes sidechains in order to resolve a political problem in the system. It exerts significant influence on the team of protocol developers.
As Adam Back, the head and founder of the company, noted sidechains can save Bitcoin followers from the system-wide collapse and efficiently solve the problem of network scaling. Symbiosis of parallel blockchains based on consensus principle is a practical solution for this difficult situation. Future belongs to Bitcoin.
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