It's the consensus protocol, Jim.  But not as we know it...

Well, of course, but they have to pick a chain to spend their hashrate on.  Merge mining doesn't mean that you mine *at the same time* on both chains.  It only means that you can switch easily BETWEEN chains.   But you have to chose for each block.

It is pretty evident that if you want to use an alt coin, that you need a wallet talking the protocol of that alt coin...
You can't transact litecoins with a monero wallet either...

Exchanges list it if they think that there will be transaction volume, which is their source of income.  ETC/ETH has been very lucrative to exchanges.  Why wouldn't they list it ?   The first exchange that lists the split, will take the lion's share of the initial volume.  Can you imagine the gains ?  Other exchanges will be eager to do so too, or leave the volume to their competitor.

Moreover, there is all chance to have a huge initial volume, because everybody owning "old bitcoin" will have "free money" on the chain that he doesn't like, and will try to cash it out for the coin he likes.  What exchange wouldn't want that volume ?

And concerning "the original protocol", that's easy: for bitcoin, it is the current one.  All the previous ones are dead, and their chains stopped.  For ethereum, it is the one that was continued by ETC.  Simple.

"not listing" to "protect the unity of bitcoin" is suffering from the tragedy of the commons.  You are foregoing a huge reward in the form of transaction fees while those not adhering to it, reap in the part you could have taken.

The fact that there IS a hard limit in the protocol is the essence.  There are alt coins that have technology-limited block sizes, like mining is technology-limited: from a certain point onwards, with a given technology, it becomes too expensive.  But when technology advances, this limit is pushed higher.  In that case, the commodity price is elastic, and determined by real world cost of resource usage.  As it should be.  And is not an artificially created scarcity, but just the price of used resource.  In order to make a monetary asset, you have to make an artificial scarcity, like the number of bitcoins.  If you make an artificial scarcity of block chain room, that automatically ALSO becomes a monetary asset from the moment that it becomes more scarce than the real resource usage.  The 32 MB limit will reach that only much later, but will reach it.


One could lower it back then, because it was considered a *technical* parameter with no scarcity involved.  One could have increased it before it became a scarcity parameter.  But that window is closed now.

Note, BTW, that LOWERING the limit is a SOFT FORK. 

And "consensus to fix the known issue" is essentially impossible, for exactly the same reason that protects the 21 million coin limit.


Not all altcoins have hard block limits.  But they will also run into problems.  However "other coins running into problems" doesn't mean that bitcoin's problems can be solved.   If you're falling out of an air plane, saying that others are falling too, will not avoid you crashing on the floor, right

The fact that bitcoin has a hard block size limit, makes that block chain space is a limited resource in the same way that the number of coins is a limited resource.  From the moment that there's a market with finite price for that limited resource (like from the moment that bitcoin wasn't $0,- any more), the consensus mechanism protects this resource scarcity.  As there is now a strongly rising fee for "room on the chain", this resource scarcity will be protected by the same mechanism that stops people form increasing the number of bitcoins beyond the original protocol.

Bitcoin having a fixed block size was programming, from the start, a scarce resource of "room on the block chain", that is coming to maturity.  The artificial scarcity of coins, that made the market cap of bitcoin's coins, is now also applied to block chain room.  Whenever this market cap becomes bigger than the coin market cap, and when "room on the chain" becomes a much more valuable commodity than (unmovable) coins, the 21 million coin limit will not matter any more, and the true value proposition of bitcoin will be "room on the chain".

This was baked in from the start in the protocol, by setting up a hard limit on block size.

Strictly speaking, no.  The original protocol is the original coin.  But with ethereum too, they "stole the name".  The original ethereum is now ETC, and the new altcoin with the modified protocol kept the name, ETH.

Note that the original splitting in mining power doesn't mean much, as two coins will emerge, and it is the MARKET CAP that will determine the mining ratio, and not the other way around.  Even a "minority miner" coin, that gets a higher market cap, will be very lucrative to mine, so will attract more miners.  And a "majority miner coin" that plummets in the market, will not be interesting to mine with high difficulty and low market value.  So miners will leave it, until miner ratio will equal market cap ratio.

Which is impossible.  Valid transactions on one network will ALWAYS end up reaching the miners on the other network if these transactions are also valid there.  We saw this with ETC/ETH.  Miners on the other network have all incentive to process these transactions to collect the fees in *their* coin.  In the end, they go and READ THE OTHER public BLOCK CHAIN to get the transactions on their chain.

You are talking about USERS, not "nodes".   Again, we have to distinguish several cases.  Suppose that we have a full hard fork (not backwards compatible).  If my friend, or my exchange, is using a "node only compatible with variant X", then it simply means they are only accepting COIN X.  If I try to pay them with coin Y, it won't work of course.  That's like as if I tried to pay a bitcoin user with Ethereum.  So the full hard fork case is easy: we're simply talking about different COINS.

Now, suppose that we talk about a soft fork.  If the soft fork has a majority amongst miners, that soft fork is simply imposed upon all miners.  Simply because every non-soft forked miner will always produce orphaned blocks, because they are considered invalid by the majority of miners.  So his only chance of getting accepted blocks on the longest chain, is also to apply the soft fork conditions.  The users nor the nodes have anything to say about it, because there's only ONE CHAIN.  They accept it, or they come to a grinding halt.  A soft fork with a majority of miners is IMPOSED upon everybody: the minority miners, the users, and the nodes.  Nodes with both protocols will accept the chain, and it *doesn't matter* what protocol they run.

Now, suppose that the soft fork is in a minority amongst miners.  That means that the majority of miners will regularly put blocks on the chain that are not accepted by the soft fork, but this will be *the only chain* that is available.  If your node is running soft-forked software, then it will simply REJECT the sole chain that exists.  But no acceptable chain will be around.  Because majority-non-soft-forked miners will still add blocks to the longest chain, and the "pure soft fork chain" will not exist.  So your node COMES TO A GRINDING HALT if it is soft-forked.  

The case of the backward-compatible hard fork looks more involved.  As long as the hard fork has a majority of mining hash rate, BOTH COINS exist.  If you want to pay a friend in "hard forked coin", you have to send "hard forked coin".  It is ANOTHER coin (an alt coin), and of course if you try to send him your original coin, it will not work.  Idem for an exchange.  A hard fork that remains a majority is similar to a full hard fork: TWO COINS exist now with separate block chains, transactions, wallets and everything.  If an exchange, a user, .... only decides to use ONE of the coins, then you have to use THAT COIN to pay him.

It becomes a major cluster fuck if the hard fork that had majority, loses this majority (determined by MARKET CAP, and miners that will follow to optimize their block rewards).  After a while, the old chain will become the longest one, and because the hard fork is backward compatible, the former hard forked chain STOPS and is orphaned.  Every wallet there is then simply LOST, and all transactions on that chain are REVERSED.

Technically, bytecoin was a good cryptocurrency, but with the "backward time machine" story to explain a 80% premine, that's even worse than DASH.  That's not sustainable as a monetary belief system.

Non-mining-related nodes don't matter.   Transactions will reach mining nodes/pools.  Non-mining nodes are only interesting for its owner, to see the block chain for himself, and verify its validity without having to trust another full node.  But full nodes that do not relate to mining don't matter in the consensus mechanism.

Everybody can fire up 100 000 nodes on amazon if he/she wants to.

What does matter, are users.  They 'vote with their money' and determine market cap.

You are simply wrong on this.

A hard fork without a strong consensus ALWAYS leads to two coins.

A soft fork with a majority consensus amongst miners ALWAYS imposes its rules and one chain emerges.

A hard fork is defined as a modification in the protocol, so that new blocks under the hard fork are not valid under the old protocol.  You still have two cases: the hard fork can be backward compatible, so that blocks under the old protocol are still valid under the new protocol (call it a backward compatible hard fork), or you can have a genuine hard fork that is entirely incompatible.

A soft fork is defined as a modification in the protocol, so that new blocks under the soft fork are still valid under the old protocol, but that blocks under the old protocol aren't valid any more under the new protocol.

Case of a soft fork:
- if a minority of miners adopts it, not really an effect.
- if a majority of miners adopts it, it is IMPOSED UPON the others.  A single chain is always the result.  The user has no choice.

Case of a full hard fork:
- from the moment a non-negligible fraction of the miners adopts it, TWO COINS emerge.  The market will split the market cap over the two coins, and miners will follow that ratio.  It is possible that the market entirely kills one of the coins, or that essentially ALL miners adopt it: ---> consensus is preserved.  ONLY IN THIS CASE, a single chain emerges (the "alt coin" in case of full consensus).

Case of a backward compatible hard fork:
the old protocol can be seen as a soft fork from the hard fork.  
- As such, as long as the old protocol remains a majority, this "soft fork" remains imposed, the hard fork cannot happen.  
- if the hard fork is majority, it can split the chain into two coins, like a full hard fork.
However, if the hard fork loses majority, the second chain becomes a major orphan, and is taken over by the old protocol chain (can be six months later)  --> super cluster fuck.

Yes, you are right (see the edit of my previous post).  This "backward compatibility" of BU with respect to the standard protocol makes that the standard protocol is a soft fork of BU.  Then they expose themselves AT ANY MOMENT to be orphaned, even 6 months later, if ever the BU fork falls beneat 51% hash rate.  Then you will get the bitcoin chain orphaned 6 months behind, because from the first >1MB onwards, the soft fork is not compatible any more, and this will be the last valid block on the chain.  Major clusterfuck !

The only safe way of making the BU hard fork, is by making it incompatible with the old protocol.  If they don't do this, and they "pull the trigger", this will be a major disaster on the chain.

You are seriously confused about this aspect.  There is no "majority hash rate consensus" between INCOMPATIBLE CHAINS.  The only thing you do with your 51% hash rate is to produce INVALID BLOCKS wrt the original protocol.  So this PoW doesn't matter, the blocks are invalid.  If you produce 1.5 MB blocks with a PoW that is more than 10 times all the PoW that ever went into bitcoin, then these blocks doesn't count because they are simply INVALID.  The old protocol simply rejects them (in the same way as if they were containing wrong signatures in the transactions).  The only valid blocks (wrt the old protocol) are those, mined with the 49% hash rate of the miners sticking to the old protocol.

But the new protocol can continue building on its own chain with bigger blocks.  

Of course, as long as BU accepts also old-protocol blocks, they need 51% of the hash rate, or the old chain (which is VALID under the new BU protocol if they don't protect themselves) will take over.  In fact, in this case, you can see the old protocol as a soft fork from the BU protocol, which can IMPOSE its will when it is majority.  In order to avoid that, BU should make the old protocol invalid too, so that ONLY BU blocks are compatible with BU.  Maybe they could flip a little-endian/big-endian convention somewhere, so that both are fully incompatible.  Otherwise, they risk at any moment to be killed by the "soft fork" of the old protocol.

Well, then you ALSO create an (incompatible) alt coin.  That's what a hard fork is: to create an alt coin.  


But that is part of the "consensus mechanism".  Having different motives, and wanting to "pull the blanket to your side" is exactly what the distributed consensus mechanism is about.  The impossibility of collusion over "pulling the blanket to your side" is exactly the origin of the immutability.  As one cannot agree on WHICH SCAM to propagate, no scam is propagated: immutability.

Distributed TRUSTLESS consensus is the putting together of sufficiently many and diverse scammers, that they cannot agree upon a single scam.  That is the essence of distributed consensus, providing you with immutability.

Indeed, and the only way to distinguish transactions between the two chains, is to mix with coins mined on one fork only.  Otherwise, your signature is valid on both chains and your transaction will happen in both coins.

Indeed. It will be a genuine hard fork / split, which would split off BU into their own altcoin. Something nice I found on reddit:

Similarly, you somehow attain 51% hashrate and split at one point (changing some rules along the way). Is your coin now Bitcoin? Whoever answers this question with 'yes' should visit a psychiatrist.
[/quote]

People don't seem to understand the fundamentals of crypto !

If you *remove the 21M coin limit* your chain is NOT COMPATIBLE with bitcoin, so of course it will not be bitcoin.  You have invalid blocks according to bitcoin's protocol !  You have simply produced an altcoin that is not recognized by the bitcoin protocol.

However, if you DON'T remove the 21M coin limit, and you start with Satoshi's genesis block, and you achieve a higher total PoW in the chain than the "real" bitcoin, then YES, you have taken over bitcoin.  That is a (very heavy) version of a successful 51% attack.


Nobody is "trying to harm" anything.  Consensus mechanism, nothing else.

This is exactly the "immutability" at work, and why I am convinced that nothing will happen.

Then they will do a genuine hard fork and two coins.  But in order to REALLY do so, that means, when they will start producing *incompatible blocks* and mine on one another, they have to realize that they will make an altcoin, losing bitcoin's first mover value proposition, which is essentially the only thing that keeps it number one for the moment.   So I wonder whether they will really do that.  In any case, if they do, there will be two bitcoin chains, two coins.

ETH/ETC all over.

I think it would be a "good thing", because then the market can choose.  But I wonder whether they will dare to do so.
Bitcoin's first mover advantage is still too valuable in my opinion.    It would be great if bitcoin could hard fork into two coins.  But I don't think it will.
They might, by total ignorance of the system, thinking that 51% is imposing its will.  But with a hard fork, that is NOT the case, as the two chains are incompatible.  Non-BU miners will reject their "longest chain" as simply invalid, and build on the valid chain with smaller blocks.  That's how the two prongs of the fork will separate.  I have a hard time thinking that this would happen by ignorance.

I'm not commenting on "good" or "bad".  I'm telling you about the dynamics of a distributed consensus system, which has as hypothesis that all scarcity parameters are frozen in eternally (that, for instance, 21 million coins cannot be changed by full consensus).  Now, block chain room became a scarcity parameter, just as valuable as the 21 million coins limit.  So, if distributed consensus mechanisms work as expected, that is, if they impose immutability, then this parameter will not be changed any more ever.  If too much tension arises between two camps, a hard fork will happen.  It is not a matter of "good" or "bad".

As I said, as long as the main value proposition of bitcoin is "first mover advantage", people will be so afraid of a hard fork and two coins, that it will not happen.  Status quo.  From the moment that bitcoin's first mover advantage over altcoins will be eroded, the hard fork will be acceptable.

But what will NOT happen, is a single bitcoin chain, with a bigger block chain, segwit or whatever.  Unless bitcoin becomes sufficiently centralized that the consensus mechanism breaks down, and a cartel can make decisions.