The Ins and Outs and Future of the 2017 Bitcoin Fork- Community Governance and Challenges
In August 2022, 5 years have passed since 2017. The market has also experienced two bull and bear market transitions. 2017 bull market, bitcoin rose from 150 USD CNY to 20,000, 2021 bull market, bitcoin rose from 3,200 USD to 68,000 USD. 2017’s hotspot is fork and ICO. 2021’s hotspot is DEFI, NFT.
As a participant in the 2017 bitcoin fork war, with 5 years, it is possible to see the main course of such bitcoin development process, and at the same time, the review now can minimize the disturbance to the market.
1, the source of the bitcoin fork.
Bitcoin has grown over the course of its development due to a thriving community and an increase in users. The use of data on the chain has become increasingly huge. The community grew concerned from 2014 that Bitcoin’s blockchain transaction capacity would not be able to support the growth of users in the future. This led to a discussion about scaling. The community has held several public scaling meetings on the main board, and one closed-door meeting between developers and the Chinese community. I have participated in the following meetings: scaling bitcoin: hongkong, milan, tokyo,silicon valley. Hong Kong developers and miners scaling meeting, and a closed door meeting between developers and the Chinese community in Silicon Valley at the end of July 2016.
As a hands-on participant in many of these meetings, the main conflicts I observed centered on.
1, whether Bitcoin’s developer team is a tight-knit organization altogether.
2. Whether Blockstream, as a private company with overlapping private founder identities and bitcoin developer identities, will take a technical route that favors Blockstream.
3, the choice of expansion technology route: Segwit, Big Block, Mimbelwimble (the technology was immature at the time.
When the closed-door meeting in July 2016 ended, my prediction for 2017 was: The unification of community and arithmetic would be a huge challenge in a bull market, and a civil war in Bitcoin was inevitable. on August 3, 2016, on my way to New York, I tweeted the following.
Silicon Valley, China community and developer conference over. Heading to New York in the evening. Bitcoin as a decentralized value system. Two major challenges ahead: maintaining arithmetic decentralization & community consensus building.
Started the preparation of Bitcoin Gold (hereinafter referred to as BTG) project.
Bitcoin 2017 fork civil war, the public debate is a war of technical lines, the essence is the different interest groups in the community competing for the huge commercial interests of Bitcoin.
2, BitcoinGold BitcoinGold (BTG) fork details.
As a strong supporter of Bitcoin’s decentralized core architecture, I support the CORE developers’ proposed cell block + SEGWIT route with a soft fork design. So the BTG route is chosen as follows.
Decentralized governance, 4/6 multi-signature. I personally hold a handful. Members are from all over the world and did not choose to come exclusively from the Chinese community.
1, BTG will not start without a third party initiated fork.
2, BTG is a test chain for Bitcoin in a production environment. Bitcoin has a test chain in a non-production environment.
3, BTG chooses the computer’s general-purpose computing hardware as the mining hardware.
4, BTG does not raise funds, does not participate in secondary market trading, and does not make statements that affect the price.
With the launch of the BCH project at Bitmain’s Chengdu mining conference in May 2017, the BTG project was officially published to the public in 2017. The technology route chosen is: 1M+Segwit, gpu mining, two-way dynamic difficulty adjustment, different address format than Bitcoin, replay attack protection. An attempt to explore the possibility of returning to general-purpose computing hardware mining for the Bitcoin community to hedge against the risk of attacks on Bitcoin by a portion of ASIC miners.
With exchanges such as Bitfinex opening trading pairs with pre-fork. BTG started the following market performance.
BTG opened trading from just over $100, and as the big bitcoin bull market unfolded, the mainnet activated and the coin price peaked: over $1,000, ranking fifth in the world, spurred by the good news that the three major Korean exchanges opened trading on the same day. Then it was bottoming out at $5, and in the 2021 bull market, reaching $200.
As for the price performance, frankly speaking, I, as the founder, am not satisfied with the price of BTG today. If I had to give a score, it would only be a passing 60.
3, BTG’s management details
In tribute to Satoshi Nakamoto, and to achieve BTG’s goal of a bitcoin test chain in a production environment, a distributed, decentralized management structure was implemented from the beginning.
1, the team is composed of 6 core members from all over the world. Two core members I have not met by 2022. 2, Financially, the project’s digital assets are managed by multi-signed accounts. The 4/6 rule is used. Some assets are locked and unlocked on a monthly basis to support the long-term development of the project.
3, the project’s funding source, using the activation of the main chain, the first stage of fast out of the block, a total of 100,000 BTG transfer to the multi-signature account. There are two main ways to fund the blockchain: 1, Bitcoin’s free development model, where developers are completely free. 2, ETH’s foundation model. The foundation controls 100% of the early token equity. 3, BTG uses an innovative donation model. Also, the manager only owns 0.5%.
This management design avoids the frequent technical and community hard forks that occur in other projects. Although BTG has not performed well in the market by 2022, in the bull market of 2021, it is still in the top 100 globally and has not gone to zero. Enough to prove the power of distributed, decentralized community.
4, Difficulties and challenges of decentralized project governance
Decentralization is the goal pursued by blockchain projects. When I founded BTG, I started out with a distributed, decentralized design in team management. At the same time the economic model fully adheres to the economic model of Bitcoin, the monetary policy.
In practice, in terms of management, governance challenges are bound to arise: quick decisions, long-term incentives.
You can look at the K-line of BTC in the 2021 bull market.
And look at the K-line of BTG in the same period:
BTG’s market cap performance 2021 bull market price did not exceed the 2017 bull market highs, while the ranking slipped from the highest fifth place, straight down to the lowest 100 outside. It is now in the 70s.
There are other coins like BCH,EOS etc. This is entering a death spiral. How low will the price fall in this bear market, and how will it perform in the next bull market round in 2025?
My observation of Bitcoin, ETH community, BTG’s personal practice, and investment in many blockchain projects, the experience gained, lessons learned.
A successful project must have a core team that is active, open, willing to keep trying, and even self-dedicated and sacrificial. If I review BTG, I will probably fix the following parts.
1, continue to globalize team building, while requiring members to be available for entry and exit. Early on, I chose to come to hold the other 5 private keys of the members, need to have an exit mechanism. Their roles started with CTO, developer, web designer. Finally a request was made to give co-founders. I was demoted from sole founder to co-founder. I didn’t care about the title change. The point is that I need to keep up with the needs of the community, and I can move in and out.
2. When BTG was the fifth highest market capitalization in the world, I wrote a notice that the market had given BTG a very high valuation and that our team needed to improve its capabilities to ensure the long-term value of the project. This announcement did not receive a positive response from everyone.
3, In the early days, when the price of the coin was high, I suggested that some (10–20k) BTG could be exchanged for fiat cash, which was not supported. The result of not implementing this suggestion was that the team did not have enough funds for development, promotion, and community motivation when the coin price was low.
4, My long-term dream for BTG is decentralized governance. So at the end of 2018, I proposed to withdraw from the management of BTG project and continue to serve BTG as a consultant. And with January 1, 2019 sold the BTG made available on the public account, the selling price was about $20. This action, within the team, DISCORD channel was fiercely abused by some members. Outside, was ridiculed bit cut leeks and returned to the community. Once was removed from the official website.
5, my advice to the team when I exited management was to keep an eye on two directions: payments and smart contracts. Throughout the 2021 bull cycle, the BTG team did not send a loud signal in the community, neither the technology, nor the promotion was actively involved.
There are more dogged details, let it go with the wind ( to Scarlett).
It gave me a deep appreciation of Chairman Mao’s joy in fighting with people; Steve Jobs’ experience of being thrown out of Apple back then.
I think I will continue to be involved in the BTG community in the right way. At the right time. Definitely.
Egg 1: How much did you scam when you created the BTG project?
-I scamed myself 10+M USD!
Egg 2: How will I participate in this ETHASH miner firing by Vitalik?
I will continue to write two more articles if people are interested.
Note 1.
Professional terms: Bitcoin, fork , soft fork, hard fork , Segwit (isolated witness), Scaling (expansion), please search for the relevant technical explanations yourself.
Note 2.
Time is running out, so if you are interested, you can participate and record an important period in Bitcoin’s history together.
