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Author Topic: Hard Fork guide (if it will happen)  (Read 4944 times)
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October 13, 2016, 03:03:25 AM
 #1

Writing/updating in progress!


If it will happen a fork of Bitcoin, meaning, of its Blockchain, what will happen is that from a point on, it will born one (or more) new chains.

This chain will have "the same" (equal) history until that point / moment.

As you know, or you should know, on the Bitcoin's Blockchain they are saved all the transactions, from the 2009 to day.

If there will be a fork at the block X (like the block 453758, to make an example), so the Bitcoin's history, of the new fork, it will be "equal" until that point. (block)

What does this mean? It means that if before the block X, you had 100 bitcoin, then after it you will have 100 bitcoin on the "old" blockchain, and 100 bitcoinX (just to give a fancy name) on the new Blockchain.

The value of the two currencies will be different. They will be two different currencies after this.

The good thing about this, is that, as investors/holders, without doing likely nothing, You will be invested in the same way (same amount) on both.
I repeat, if you had an amount of bitcoin until now, then you will have it even after, on both blockchains.

You will be able then to decide to sell a little on one side, or the other, or keep them still and wait longer term.
The safest thing we say, would be doing nothing, and see how the market (other users / buyers / seller more confident of their choices) will decide to do, Following the exchanges in the various markets.

Any fork will be reported by me or by others, possibly months in advance.
On the forum, on facebook and on chats.

If you will do nothing and you will find yourself on clients / exchange / inappropriate situations to have both tokens (Bitcoin and BitcoinX), what will happen is that you simply will have the bitcoin, only on the current chain, meaning, the chain of the current team that is working on Bitcoin Core.

The choice to stay on the various fork, and not on a single one, may be here because:
- You don't trust of the curreny team on Bitcoin Core, and of the future that they are proposing.
- You trust them, but why avoiding the possibility to have more coins that can be sold (and gaining something) when it is possible?
- You trust them, but not entirely, better to be safe, because it costs so little (the time to adjust your situation)


However! (important things)

- Having control on your own bitcoins, it means having the complete/total and absolute control of private keys. I mean all the private keys, as single or more (client multisig)
It a very imortant thing, you have to be sure to have complete control of your bitcoins, to be sure, with certainty, to being able to use/have/control them, even on the new fork.

- Being able to export the private keys
Another thing that it will be needed is that the client that you are using will allow you with certainty, to being able to export the private keys, all of them!
This to being able to, easily, importing these keys on the new clients / wallets that will support the new fork.


It is important that the bitcoins are on an appropriate client, BEFORE the fork.
After the fork, the coins on the current Bitcoin, on the old chain, you will be able to take them on your before prefered client / service (if it wasn't respecting the two rules above)

Below I will put a list of clients that I consider valid to guarantee the ability to have bitcoin also present in the new blockchain.
If there is a client that doesn't appear on the list, just ask, and I will try to add it, by indicating whether it is adequate or not.

Clients / adequate situations / to have, by choice, before the fork (like, 6 or more confirmations/blocks before it happens):
- Electrum
- Jaxx
- Copay (https://iancoleman.github.io/bip39 / https://github.com/iancoleman/bip39)
- Mycelium (https://iancoleman.github.io/bip39 / https://github.com/iancoleman/bip39 - "Mycelium" )
- Multibit HD (https://iancoleman.github.io/bip39 / https://github.com/iancoleman/bip39 - "Hive Wallet" )
- Breadwallet (https://iancoleman.github.io/bip39 / https://github.com/iancoleman/bip39 - "Hive Wallet" )
- Bitcoin Core - (until the v0.13.0, at the moment) - http://bitcoin.stackexchange.com/a/5933/259
- Bitcoin Unlimited - http://bitcoin.stackexchange.com/a/5933/259
- Bitcoin Classic - http://bitcoin.stackexchange.com/a/5933/259
- Bitcoin XT - http://bitcoin.stackexchange.com/a/5933/259
- Paper wallet (single bitcoin address and private key)
- Blockchain.info - However it isn't a recommended wallet (https://iancoleman.github.io/bip39 / https://github.com/iancoleman/bip39)
- Bitcoin Armory

Not sure, I haven't tested it directly:
- Trezor (https://doc.satoshilabs.com/trezor-tech/cryptography.html - https://iancoleman.github.io/bip39 - https://github.com/iancoleman/bip39 )
- Ledger (http://support.ledgerwallet.com/knowledge_base/topics/how-to-restore-my-backup-without-a-ledger-wallet - https://iancoleman.github.io/bip39 / https://github.com/iancoleman/bip39 )

To use https://iancoleman.github.io/bip39, it's better to download the source and open it on a secure offline system
https://github.com/iancoleman/bip39/archive/master.zip


Clients / inappropriate situations / to not have if you want to be assured of having the coins on both (or more) forks:
- Leaving your bitcoins on the exchanges: there isn't any certainty that the exchanges will permit you to have the coins on all the blockchains. You will have to withdraw them, and put them on adeguate clients, before the fork.
- Coinbase
- Circle
- Uphold
- All online wallet (that are always insecure)
- ...


_____________


This is an english translation of the the post on the italian section: https://bitcointalk.org/index.php?topic=1641827.0
There is also a spanish version: https://bitcointalk.org/index.php?topic=1644893.0

They get updated daily, suggestions are welcome.

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https://bitcointa.lk: Bitcointalk backup if offline - Bitcoin Foundation Italia - Blog: http://theupwind.blogspot.it
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March 14, 2017, 06:53:52 AM
 #2

UP because more relevant during those days Smiley

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March 14, 2017, 08:02:58 AM
 #3

Writing/updating in progress!

You will be able then to decide to sell a little on one side, or the other, or keep them still and wait longer term.


Good post, thanks for the translation.

Let's say a fork occurs, and it's Bitcoin Unlimited branching off of Core.

If I have my coins in cold storage, what's the procedure if I want to sell off my Unlimited coins? I assume it's the following:
 
  • Export my private keys from my cold wallet (or wherever they are stored)
  • Download and install Bitcoin Unlimited client
  • Import my private keys into my Bitcoin Unlimited client
  • Send my BU coins to an exchange (say shapeshift.io) in exchange for Core coins or fiat or whatever
  • Provide new cold storage addresses to receive the new Core coins

Is that right?
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March 14, 2017, 08:10:31 AM
 #4

If I have my coins in cold storage, what's the procedure if I want to sell off my Unlimited coins? I assume it's the following:
 
  • Export my private keys from my cold wallet (or wherever they are stored)
  • Download and install Bitcoin Unlimited client
  • Import my private keys into my Bitcoin Unlimited client
  • Send my BU coins to an exchange (say shapeshift.io) in exchange for Core coins or fiat or whatever
  • Provide new cold storage addresses to receive the new Core coins

Is that right?
No. Your BU transaction can be replayed on the Core chain, with the result that you lose all your Core coins.

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March 14, 2017, 08:22:47 AM
 #5

Ok so to a newb here. If BU is accepted and I have my BTC on a Ledger wallet. Will I have a BTCU and a BTCC wallet? Will Ledger handle that or will I have to find my private keys?

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March 14, 2017, 08:40:28 AM
 #6

If I have my coins in cold storage, what's the procedure if I want to sell off my Unlimited coins? I assume it's the following:
 
  • Export my private keys from my cold wallet (or wherever they are stored)
  • Download and install Bitcoin Unlimited client
  • Import my private keys into my Bitcoin Unlimited client
  • Send my BU coins to an exchange (say shapeshift.io) in exchange for Core coins or fiat or whatever
  • Provide new cold storage addresses to receive the new Core coins

Is that right?
No. Your BU transaction can be replayed on the Core chain, with the result that you lose all your Core coins.

Ok. What's the best way to accomplish it then?
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March 14, 2017, 09:25:59 AM
 #7

Is that right?

Yes and no.
There is a possible problem of the "replay attack".
This must be fixed from the node of the minority chain. (so you have to wait a new Core version that fixes this, or from someone else)

Anyway, yes, if you really hold your bitcoin, so you own your private keys, you will have both coins, the problem is just in the transaction to move the coins in the minority chain.

You will have to wait for a Core version with the fix, but you will be on both chains.

If there will be a Core version with this kind of fix, I'll add it here on the guide.

Currently this guide can just help you to be sure of being on both chains.

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March 14, 2017, 09:57:15 AM
 #8

HF is necessary for the improving of bitcoin, but i hope it not split to two chains. It the HF happened, the majority should kill the minority. 
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March 14, 2017, 10:12:16 AM
 #9

If I have my coins in cold storage, what's the procedure if I want to sell off my Unlimited coins? I assume it's the following:
 
  • Export my private keys from my cold wallet (or wherever they are stored)
  • Download and install Bitcoin Unlimited client
  • Import my private keys into my Bitcoin Unlimited client
  • Send my BU coins to an exchange (say shapeshift.io) in exchange for Core coins or fiat or whatever
  • Provide new cold storage addresses to receive the new Core coins

Is that right?
No. Your BU transaction can be replayed on the Core chain, with the result that you lose all your Core coins.

Ok. What's the best way to accomplish it then?

Get yourself some dust from a block mined on one of the chains. Combine that dust with your existing coins by sending a transaction to another address that you control. Since those coin base rewards don't exist on the other chain, this transaction will only be valid on one chain. After that, send your coins on the other chain to a new address that you control (extra measure just to be sure). At this point, your coins will be effectively disassociated between the two existing chains.

There is another method which may become possible if the second chain is a Bitcoin Unlimited chain. Since blocks will be larger on the Bitcoin Unlimited chain (that's the point after all), they will allow for many, many more transactions. So, you can just start sending your bitcoins to yourself over and over and over again. Over time, these transactions will be written into the Bitcoin Unlimited chain, but will be a chain of unconfirmed transactions on the original Bitcoin chain. At this point, you try a "double spend" to yourself (to a different address under your control) with a higher fee on the Bitcoin chain. Once one of these "double spend" transactions make it into a block on the Bitcoin chain, these coins will effectively be disassociated from the Bitcoin Unlimited chain.

If you aren't the sole controller of your private keys, you don't have any bitcoins.
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March 14, 2017, 10:43:36 AM
 #10

for clarity

hard = node vote then pool
soft = pool only

the term fork does not mean automatic permanent altcoin maker. it just means change of rules leading to different blocks being created.
what happens after that defines different scenarios

consensus/orphaning mechanism would trash blocks it did not like(orphans). and unify the blockchain into something the majority can accept, leaving the minority stuck and unsynced to the network due to not liking blocks it did not agree with.

the only way to keep a minority alive is to actively and intentionally ban the opposition to avoid seeing or using the consensus mechanism and only connecting to peers with the same acceptable parameters as you. this is called a split. which is bilateral if both sides agree to the split or unilateral if only one side agreed to split.

below these umbrella terms is what could happen.. in both hard and soft it can either continue as one chain. or bilateral split
softfork: consensus - >94% pools no banning/ignoring of minority. result: small 5% orphan drama then one chain. minority unsynced and dead
softfork: controversial - >50% pools no banning/ignoring of minority. result: long big% orphan drama then one chain. minority unsynced and dead
softfork: uni/bilateral split - intentionally ignoring/banning opposing rules and not including them. result: 2 chains

hardfork: consensus - >94% nodes, then >94% pools no banning/ignoring of minority. result: 5% orphan drama then one chain. minority unsynced / dead
hardfork: controversial - >50% nodes, then >50% pools no banning/ignoring of minority. result: big% orphan drama then one chain. minority unsynced / dead
hardfork: uni/bilateral split - intentionally ignoring/banning opposing rules and not including them. result: 2 chains


it requires intentionally banning the opposition to keep different blocks alive(ignoring consensus orphan mechanism). otherwise the orphaning mechanism causes some drama and one height is found the majority can agree on.

alot of people will try to tell you that bitcoin has not protective self regulating mechanism (the consensus orphaning mechanism) they will tell you you have to trust devs. you have to trust pools etc.. but you dont. the nodes will sort out a single unified chain if everyone puts up with some orphan drama, leaving the minority simply unsynced.



actively banning nodes to then build ontop a chain that the majority reject/minority accept may give you "double coins" but this is just temporary. once you spent those coins. thats it. gone.

a few minutes of greed to spend double the coins does not mean you will guarantee to profit because the market reaction of having 2 differing coins will cause the value of each side to change.

it can also cause peoples opinion of 'security' to diminish if it becomes easy to double coins. (EG like the fiat share market, regular share dilution devalues the shares when new A or B class shares are introduced and people lose trust in holding shares)
intentionally keeping 2 chains alive can be disastrous for a currency worth something . but profitable for a useless speculative coin.

think beyond the temporary greed of a double coin event and think about the long term result us such an action of splitting to a minority alt.

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Don't take any information given on this forum on face value. Please do your own due diligence & respect what is written here as both opinion & information gleaned from experience. If you wish to seek legal FACTUAL advice, then seek the guidance of a LEGAL specialist.
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March 14, 2017, 10:52:53 AM
 #11

Thanks for the post it is very educational and I learned many new things about hardfork. I was just disappointed to see that blockchain.info wallets are no longer a recommended wallet after the fork. But I do hope they can upgrade so they adopt to the new blockchain. Blockchain.io system and features are very nice and so I really wanted to see them functioning well even after the fork.

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March 14, 2017, 11:24:18 AM
 #12

Thank you for your updates, it's really very helpful to us people that use bitcoin. Situations that are imminent are really unpredictable, which would be a big obstacle for bitcoins if made wrong choices. Bitcoin unlimit is an option so stay away, it will have a huge impact on bitcoin. It can even cause a bitcoin to crash. The miners are showing their greed, so ugly. I hope you keep the stance and refuse bitcoin unlimit

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March 14, 2017, 12:12:43 PM
 #13

Thank you for your updates, it's really very helpful to us people that use bitcoin. Situations that are imminent are really unpredictable, which would be a big obstacle for bitcoins if made wrong choices. Bitcoin unlimit is an option so stay away, it will have a huge impact on bitcoin. It can even cause a bitcoin to crash. The miners are showing their greed, so ugly. I hope you keep the stance and refuse bitcoin unlimit
mempool bloat and fee increase (due to spam/congestion) is more about showing the network something needs to be done. and not about GREED

when you look at which team removed priority, removed reactive fee and replaced it with biasly increasing 'average' fee estimations you se its core that are pushing fee's up even if demand became low.

when you look at the stats of when mempools increase. you see there was a short rise and fall in june/july 2016 and a general rise after october.
this is normally done to sway miners into thinking something needs to change.

now taking into account that core CHOSE to avoid a node first pool second confidence building consensus event. and just do a give the vote to pools.
means you cannot blame the pools for having the vote and deciding one way or the other. its not their fault that nodes were bypassed.

also the timing of the mempool bloat events coincide with CORES bips wanting activation. shows who wants to sway pools into thinking something needs to be done sooner rather than later.

lastly.
BU can accept blocks from core, xt, classic and others no matter what their parameters change to.
xt can accept blocks from core, BU, classic and others no matter what their parameters change to.
classic can accept blocks from core, BU, xt and others no matter what their parameters change to.
BUT
core's current and near future releases wont accept blocks from BU, xt, classic and others if parameters of the longest chain change.

meaning if core is left as the minority they would then need to ban nodes to keep a minority chain alive
meaning if core becomes a majority they would then need to ban minority nodes and blocks to avoid orphan headaches

other implementations want to work on the same playing field using consensus.. only core are the ones that are offering to do uni/bilateral splits.

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March 14, 2017, 12:38:40 PM
 #14

Getting dust from the BU chain seems the best method to me.

I suppose we have quite a bit of time to worry about it, it isn't happening soon.

If UASF happens and BU hard-forks in response (a possibility) then using a SegWit transaction with all your coins in a core client would likely be invalid in BU allowing you to then use BU to create a TX that would be invalid in core because the coins are spent in core chain.

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March 14, 2017, 01:43:38 PM
 #15

HF is necessary for the improving of bitcoin, but i hope it not split to two chains. It the HF happened, the majority should kill the minority. 
There will be split for sure, one of the recent example is split of ETC and ETH. ETC is still alive and have some value but this is not good for bitcoin. I also hope we will not see hardfork.

Good guide, thank you.

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March 14, 2017, 02:04:28 PM
 #16

There will be split for sure, one of the recent example is split of ETC and ETH. ETC is still alive and have some value but this is not good for bitcoin. I also hope we will not see hardfork.
There is a big difference between BTC and ETH.
BTC hasn't a so dynamic difficulty change, it changes only every 2016 blocks.
So, it will not be so easy to have two working chains as it happened on ETH.

To make it happen more easily, Core team needs to release a new Core version with a hard fork (yes, a hard fork in Bitcoin Core) to change the POW or the difficulty.

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March 14, 2017, 02:19:41 PM
 #17

So now I have a natural question after reading the guide in the first post of this thread. I cannot export my private keys as I have them in my hardware wallet which doesn't allow such thing. What will happen with me, how can I be able to use both blockchains if this split happens? Thanks in advance for your answer.
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March 14, 2017, 02:24:07 PM
 #18

So now I have a natural question after reading the guide in the first post of this thread. I cannot export my private keys as I have them in my hardware wallet which doesn't allow such thing. What will happen with me, how can I be able to use both blockchains if this split happens? Thanks in advance for your answer.
Can you say which is your hardware wallet? How does it work?

If you hardware wallet is connecting to only a server of the company where you bought it, then I don't think that it is very secure.
Anyway, you will have the coins only on the chain chosen by the company. (or, they will have somehow to give you access to the token even on the other chain)

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March 14, 2017, 02:27:09 PM
 #19

If I have my coins in cold storage, what's the procedure if I want to sell off my Unlimited coins? I assume it's the following:
 
  • Export my private keys from my cold wallet (or wherever they are stored)
  • Download and install Bitcoin Unlimited client
  • Import my private keys into my Bitcoin Unlimited client
  • Send my BU coins to an exchange (say shapeshift.io) in exchange for Core coins or fiat or whatever
  • Provide new cold storage addresses to receive the new Core coins

Is that right?
No. Your BU transaction can be replayed on the Core chain, with the result that you lose all your Core coins.

Ok. What's the best way to accomplish it then?

Get yourself some dust from a block mined on one of the chains. Combine that dust with your existing coins by sending a transaction to another address that you control. Since those coin base rewards don't exist on the other chain, this transaction will only be valid on one chain. After that, send your coins on the other chain to a new address that you control (extra measure just to be sure). At this point, your coins will be effectively disassociated between the two existing chains.

There is another method which may become possible if the second chain is a Bitcoin Unlimited chain. Since blocks will be larger on the Bitcoin Unlimited chain (that's the point after all), they will allow for many, many more transactions. So, you can just start sending your bitcoins to yourself over and over and over again. Over time, these transactions will be written into the Bitcoin Unlimited chain, but will be a chain of unconfirmed transactions on the original Bitcoin chain. At this point, you try a "double spend" to yourself (to a different address under your control) with a higher fee on the Bitcoin chain. Once one of these "double spend" transactions make it into a block on the Bitcoin chain, these coins will effectively be disassociated from the Bitcoin Unlimited chain.

Most probably, the safest method is to use an exchange that lists both coins, and has provisions to do the split for you, that is, to send the "unified old coins" to an address attached to you on the exchange.  The exchange will then give you IOU of both types of coins.  You can trade those (for instance, selling off your bitcoinx and buy more bitcoin, or selling off bitcoin to get more bitcoinx).  When you will withdraw the coins, they will be 1 type only.

But be sure you use an exchange that knows how to handle this.  Most big exchanges learned this during the ETH/ETC split.  Some made big mistakes.  Some stole the ETC of their customers, pretending they didn't "list" ETC.

With ethereum, there was a smart contract that could do the split for you, but with bitcoin, that's not the case, and the only way to do so is to use "newly mined dust", which is hard to come by for a normal user.
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March 14, 2017, 02:33:29 PM
 #20

for clarity

hard = node vote then pool
soft = pool only

the term fork does not mean automatic permanent altcoin maker.

hard is not "nodes vote".  Hard is: miners DECIDE to fork (to make two chains). 
But it is only when there is a permanent double coin on exchanges, that the USERS can vote in the market.

If miners decide to hard fork and are united in that aspect, they are just as well sole deciders as with a soft fork.
The only difference is that with a soft fork, there doesn't need to be unity amongst miners to fork: a MAJORITY of miners can impose their choice on the minority of miners that do not agree.

With a hard fork, the minority of miners that do not agree, can continue to build the old chain, making two coins, on which the USERS will vote in the end.

But as long as miners only make one block chain, nodes nor users can vote.  Well, users can only vote by leaving that crypto currency.

(nodes can never vote: it is not vote by node, but vote by proof of work).

The only thing that this "node" stuff does, is to try to fathom what will be the market response ; or as a means of propaganda. 
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