I've been coming across this term quite often recently as I'm reading about the upcoming expected Segwit2x hardfork.
Can someone please explain to me what the significance of this is, and why this is such a point of contention when it comes to this hardfork?
Full (two-way) replay protection makes it so transactions on one chain are invalid on the other. This way, no one will unintentionally send funds on both chains. If there is no replay protection, a user can go to send B2X, then the transaction can be "replayed" on the BTC chain since transaction format is identical. The user could then lose that BTC.
The reason that the NYA companies don't want replay protection is that it will force them to change the transaction format in a way that will break compatibility with SPV wallets. Their plan seems to hinge on leveraging SPV users -- there's a lot of them, so they are economically important. So I see why they are going forward without replay protection from a practical standpoint. I find it coercive, though, and I also don't think it's representative of their customers' interests. People will lose money over this.
