Major mining companies begin supporting Bitcoin Classic

Following months of discussion on how to better scale the bitcoin network to accommodate a greater number of transactions, bitcoin mining companies have begun supporting a new proposal for Bitcoin Classic.

Although a newcomer to the debate, Bitcoin Classic has so far received support from Bitcoin developers, including former Bitcoin Core maintainer Gavin Andresen , Blop CEO Jeff Garzik and Ledger editor Peter Rizun. If the proposal is passed, Bitcoin Classic will increase the block size of the Bitcoin blockchain from today's 1MB to 2MB.

The proposal has caused considerable controversy in the industry because it runs counter to the suggestion made by Bitcoin core developers to increase transaction capacity by 4 times without directly increasing the block size.

Bitcoin mining firms believe that the solution to the scaling debate must come in the form of a direct increase in the network’s block size, but Bitcoin Classic offers a more direct solution to the perceived problem that Bitcoin as a whole is not large enough to accommodate new users.

So far, seven mining companies, including BitFury, Bitmain and Genesis Mining, have expressed their support for the Bitcoin Classic expansion proposal.

At the North American Bitcoin Conference (TNABC) this week, the three groups also expressed their enthusiasm for the proposal and believed that Bitcoin Classic is the fastest solution to achieve the progress of open source projects.

BitFury CIO Alex Petrov explained during the panel:

“Right now, the Bitcoin Core team is slowly rolling out a very complex solution that is still in the testing phase, even though it’s been a year and a half. The Bitcoin Classic proposal is the most direct answer.”

FinalHash CTO Marshall Long, Genesis Mining CEO Marco Streng, and Bitmain’s Yoshi Gato all spoke out about the proposal, stressing that while the industry needs a solution, speed should also be prioritized.

Gato said that “using the Bitcoin Classic scaling solution, the transition could be completed in a matter of weeks.”

Despite the consensus among the day’s panelists, some Chinese miners have begun to waver on the Bitcoin Classi expansion plan as major Chinese mining companies have not been firm in their stance on their favorite proposals.

Notably, there are developers like Andresen who have indicated that they support both proposals, suggesting that others may be willing to cooperate with proposals that are gaining traction in the market, thereby helping the network scale.

A “simple and clear” solution

In his statement, Long praised the Bitcoin Classic solution, calling it the “most straightforward” solution from a technical perspective.

The panelists also expressed their belief that the Bitcoin Classic proposal was only intended to increase the block size and no further changes would be forthcoming.

“We support the Bitcoin Classic proposal because it solves the problems we have today,” Streng told the audience. “Bitcoin Classic is a proposal that increases the block size without changing the rest of the blockchain.”

However, some members of the community are concerned that this information will be leaked to the Bitcoin core team and developers.

For example, Austin Hill, CEO of Blockstream, whose company funds much of the core team’s major development work, said that Bitcoin Classic’s message about reasonable suggestions from developers was not being heeded.

Danger escalates

However, while the rules proposed by Bitcoin Classic are simple and clear, they are different from the basic route proposed by Bitcoin Core. It requires a hard fork of the Bitcoin blockchain, which means that it also needs to make changes to solve the incompatibility problem between the old and new versions of the software.

Streng continued, “Bitcoin Core developers say that miners and service providers might be able to do this, but merchants and other entities can’t. That’s what they’re arguing about, and we need to make sure everyone is on board with this proposal.”

Gato pointed out that there is still a potential danger that some community members will continue to run the Bitcoin Core wallet, resulting in two versions of the Bitcoin blockchain.

“I think that as a result of the hard fork, Bitcoin Classic will likely expand the existing system into two separate blockchains,” he said.

Petrov believes that despite the risks, the issue of increasingly crowded blocks on the Bitcoin blockchain is the key issue that needs to be addressed.

Petrov described the project’s “survival issues” as follows:

“If the Bitcoin Core team doesn’t come out with [a solution] in time, then we will force this solution, and that’s why we support the classic solution. It may not be the best way, but we have to do it.”

Overcoming obstacles

However, Long believes that the bitcoin community needs to face the challenges of hard forks together because more and more businesses and consumers will use blockchain and the demand for the technology is likely to grow in the future.

The comments are similar to Garzik’s original ideas raised during a Bitcoin scalability workshop in Hong Kong, where community developers proposed various solutions for how the blockchain should be designed.

Petrov admitted that while there is still work to be done to increase community awareness for the change, it is best to wait for a solution for now.

Petrov concluded:

“It’s not easy to make the switch, but we will be able to do it one day. That’s why we support Bitcoin Classic.”