BCH Hard Fork Investment Guide

In early November 2018, the sudden rise of BCH attracted the attention of a large number of digital currency investors, but many investors did not understand what stimulated the surge in BCH. Before the hard fork comes, I think it is necessary to popularize the causes and consequences of this hard fork for investors' reference.

According to the upgrade plan of the BCH community (see the roadmap released by bitcoincash.org for details), a hard fork upgrade will be performed at UNIX timestamp 1542300000 to ensure the future competitiveness of BCH.

Upgrade Summary:

When the median time of the last 11 blocks (MTP-11)[1] is greater than or equal to UNIX timestamp 1542300000 (approximately 0:40 on November 16, 2018, Beijing time), Bitcoin Cash will perform an upgrade of the network consensus rules according to this specification. Starting from the next block, these consensus rule changes will take effect:

Remove topological transaction order constraints and enforce canonical transaction order Enable OP_CHECKDATASIG and OP_CHECKDATASIGVERIFY opcodes Enforce minimum transaction size for scriptSig Enforce "push only" rule Enforce "clean stack" rule

Cause of the incident:

On August 16, 2018, nChain announced the creation of the BSV node client. Its full English name is “Satoshi Vision”, which means “Satoshi Vision”. Craig S Wrigh, who once called himself Satoshi Nakamoto, is the chief scientist of nChain.

The initial BSV release was tested in the first week of September 2018. The code was based on Bitcoin ABC v0.17.2 while including as few changesets as possible.

Bitcoin SV nodes will be incompatible with other BCH node clients during the BCH hard fork upgrade in November and will refuse to provide replay protection.

Main differences:

Will make BCH much closer to the original Bitcoin protocol Restore more original Satoshi opcodes (OP_MUL, OP_LSHIFT, OP_RSHIFT, OP_INVERT) Remove the limit of 201 opcodes per script and increase the upper limit of block size to 128 MB

Make an impact:

The client caused disagreements in the BCH community and was resisted by major supporters of the BCH community, such as Wu Jihan, Roger Ver, Yang Haipo, Jiang Zhuoer, Bitcoin ABC chief developer Amaury, Bitprim developer Juan, etc.

At the same time, Ethereum founder Vitalik Buterin also commented on the risk of BCH forking caused by BSV nodes: CSW should be allowed to fork BCH, because this will remove CSW from the BCH community and is beneficial to the long-term development of BCH.

On October 12, 2018, Bitcoin Unlimited, another BCH development team, released the latest version of the BCH client 1.5.0.0, which is compatible with the BitcoinABC version.

On November 2, 2018, Bitcoin.com announced that it would continue to run Bitcoin ABC 18.2 and Bitcoin Unlimited 1.5.0.0 versions after the network upgrade.

On November 3, 2018, Coinbase announced that it was ready to support the roadmap released by bitcoincash.org, namely the BitcoinABC version.

Wallets & exchanges that have announced snapshots or will distribute BSV assets 1:1:

CoinEx, CocoWallet, IFWallet, BitApp, Bitpie, OKEx, Huobi, Binance, gate.io, ZB.com, Bit-Z, BitONE, Poloniex, etc.

In the next ten days or so, I believe that more and more exchanges will support candy snapshots.

As of November 5, 2018, the BCH node client distribution is:

Compatible BCH nodes:

Bitcoin ABC 52.99%Bitcoin Unlimited 37.81%Bitprim 2.84%Bitcoin XT 0.97%Bcash(Bcoin) 0.29%Other 0.58%

Incompatible BCH nodes:

Bitcoin SV 4.81%

The above is the specific situation of this hard fork upgrade. Incompatible BSV nodes caused variables in the BCH upgrade in November, and a new currency BSV may be created.

How exchanges will handle BSV:

As early as September 1, 2018, CoinEx, the BCH pricing exchange, had already released a "Plan for Dealing with BitcoinSV (BSV), a Potential Fork of Bitcoin Cash":

If there is a fork, CoinEx will distribute BSV assets to BCH users at a 1:1 ratio according to the asset snapshot at the time of the fork; after the fork is completed, CoinEx will launch the BSV/BCH trading pair to meet the trading needs of users; even if there is no transaction replay protection mechanism, CoinEx will work with the ViaBTC mining pool to protect the security of users' assets.

When Ethereum split in 2016, hackers exploited the loophole to continuously deposit and withdraw ETH and defraud additional ETC because the exchange did not anticipate the risk of not providing replay protection. Now it is the end of 2018, and after the IFO wave in 2017, the exchange has accumulated enough experience. If they want, they are fully capable of separating the forked coins without adding replay protection. If they don't want to, they can also ensure that users holding BCH are safe.

The above premise is that the exchange has sufficient technical capabilities.

How investors operate during this period:

Affected by the hard fork upgrade and the positive impact of candy, BCH's weekly increase has been close to 30%. According to past experience, this wave of market may slightly adjust before the upgrade is completed, but it is unlikely to stop. For BCH investors, holding BCH and waiting for candy is the most stable choice. If you want to get more BSV candy, you can also hold more BCH.

What if the BSV fork fails? Or the exchange is not planning to list BSV due to replay protection issues?

It doesn’t matter, your BCH is more valuable now.

Where are the miners going?

More exchanges and influential companies have expressed clear support for the BCH upgrade route, which is like driving more nails into the coffin of "Aobencong Vision". In particular, the statements from Coinbase and Bitcoin.com almost announced the end of this farce in advance.

For miners, responding to BCH's upgrade plan is the option with the least risk (little to no risk), because the top five mining pools with the largest computing power in the world will respond to BCH's upgrade plan, and the six node clients recommended by bitcoincash.org are all compatible with BitcoinABC.

In addition, as the BCH market moves upward, more machine gun pools may switch their computing power to BCH. Since more than 95% of the nodes are currently running BitcoinABC or compatible clients, these guerrilla computing powers will also become reinforcements to help BCH upgrade.

The above are the details of this hard fork upgrade.

I hope that the series of farces extended by this hard fork upgrade can bring greater growth to the BCH community. I also wish BCH investors can gain more wealth from this upgrade.