Bitcoin Cash Fork: The Battle between Bitcoin Cash ABC and Bitcoin Cash SV

Information about the launch of the Bitcoin Cash SV network appeared in the Internet on August 16, 2018. It was announced by nChain, the founder of which is Craig Wright, who claims to be hiding behind a pseudonym: Satoshi Nakamoto. However, nobody knows whether it’s true or not. This protocol is supported by the news giant CalvinAyre, Bitcoin.org, and Coingeek. Their second name is “reformers” or “innovators.”

A few days later, on August 20, Bitcoin ABC launched its full node, consisting of 2/3 BCH nodes. They also are known as the “conservative wing” that is willing to protect the network from radical upgrades. Their leader is Roger Ver. No wonder they are followers of traditional network structure and argue against radical upgrades. However, their roadmap doesn’t exclude the possibility of further upgrades to the network in which the main priority is reducing transaction fees.


BCH ABC is supported by Bitmain, the first global company that manufactures ASIC hardware. It’s currently the most power-efficient BTC miner. Also, it’s supported by a huge number of trustworthy global exchanges, including Binance and Coinbase.

Let’s consider the upgrades the two forks offer, the differences they have, and whether there are neutral parties apart from these two main leaders.

Main Disparities Between the Two Key Competitors

There are several main differences between the two competitors.

The first difference between the “conservative wing” and the “innovators” is that Bitcoin SV is the adherent of a new opcode.

The “innovators” offer to change the original protocol and the BCH network’s initial structure.

However, the “conservatives” are also going to implement a new opcode that will provide users with cross-chain atomic contracts and oracles. Their main purpose is to protect the network from spam and reduce fees for typical payments. Additionally, one of the main divisions of work is to decrease the size of transactions to 100 bytes, thereby protecting the network from attacks on the Merkle tree.

On the other hand, Craig Wright stated that he wanted to minimize the overall number of non-cash transactions because, in his opinion, cash is the main prerogative of the network.

Canonical Transaction Ordering

Opponents of BCH SV offer Canonical Transaction Ordering, which will decrease the amount of data necessary for transfer between nodes. A new way of transferring data will improve blockchain scalability in the future. The previous model of the BCH network was called the Topological Transaction Ordering Rule.

Let’s consider the advantages of the Canonical Transaction Ordering Rule in comparison with the previous model, according to the research of Jonathan Toomim:

  • the level of block emission efficiency is higher
  • the software is easy to implement
  • it’s now easier to add a new transaction to a block
  • generating new blocks is more efficient
  • the level of the protection against attacks is higher
  • opt-in locality between participants in the network is possible.

The main difference between BCH ABC and BCH SV

The main difference between the two competitors is the size of the block. The “innovators” offer to overwrite the Bitcoin Cash network’s scripts entirely, and to extend block size from 32 MB to its maximum 128 MB. This will positively impact network capacity as well as blockchain scalability. However, BCH ABC is a follower of the traditional Bitcoin Cash block size, and argues that it’s currently the most reasonable limit.

The Bitcoin Cash ABC team wants to create “sound money” that everyone all over the world will use with ease. The team is willing to equip consumers with the most useful and comfortable payment network for miners, users, and investors.

Followers of the Neutral Position

There is also a neutral party between the two competitors. This neutral position belongs to Bitcoin Unlimited, who represents another strategy for splitting. It has offered to change both new networks, thereby depriving miners of the opportunity to generate blocks.

Another adherent of the neutral position is Cobra Bitcoin. They were popular among crypto enthusiasts because of their proposed changes to the BTC white paper and upgrade to the original BTC consensus protocol PoW. The team argued these changes by stating the necessity of greater decentralization. The team was going to establish a reputation by offering an option to avoid a fork. Cobra explained their decision by citing potential damage to BCH price and status.

Which Network Have Mining Pools Decided to Join?

It’s important to know which blockchain mining pools to join. Coingeek, BCH’s largest pool, supports an innovative solution: Bitcoin SV. It is a sponsor of this project. Among other major news channels that support the new protocol, Applicature would like to mention CalvinAyre and Bitcoin.org.

However, other mining pools prefer “conservatives.” A leader of this division is the founder of Bitmain, Jihan Wu, who runs mining pools that include BTC.com and Antpool. He has called his opponent “a fake Satoshi.” Another pool, ViaBTC, sponsored by Bitmain, has joined this group.

Which team Vitalik Buterin supports

Vitalik Buterin also supports the “conservatives,” and calls the founder of nChain a “fraud.” Also, he stated on his Twitter that the BCH community shouldn’t concede to Craig Wright to gain the upper hand in order to avoid a split-up. On the contrary, he has stated that it represents a chance to stand against him.

A dispute about the block size broke out between the CEO of ViaBTC Haipo Yang and Craig Wright. Haipo Yang offered to reduce the time for generating a new block to 1 minute, and his opponent supported the idea of keeping the usual time: 10 minutes. Haipo Yang stated that 1 minute was more accessible, and would protect the network against DDOS attacks.

Nobody knows the exact  hash rate each pool obtains. However, Applicature states that Coingeek achieves around a 27-29 percent hash rate. A group of pools that includes AntPool, ViaBTC, and BTC.com runs from 16 to 21 percent. The other 30 percent is run by unknown pools.

Which Side Won the Fight?

Miners supporting both protocols started a competition on November 15, 2018. The first block in the ABC network was generated by the Bitcoin.com pool. It reached a height of 556767. Later, the first SV block was generated on another network. Its high was also 556767. In this way, two new blockchains were created.

For the ABC block’s victory, the co-founder of Bitmain invested his additional mining force. He commented that the price of BTC may have fallen as low as $5,000 U.S. because of borrowing the hash rate from the BTC network, but if nChain decided to compete, he was ready to go to the end.

The creator of Bitcoin.com stated that he also would use his hashing power, and relocate it from the BTC network to BCH. Craig Wright stated on Twitter that he would continue mining until the strongest side won.

The increase of hashrate

The hashrate of BCH increased from 9.54% to 15.43% from November 10 to November 17. This hashrate covered a significant part of the hard fork competition. Therefore, the hash rate of Bitcoin dropped by 7%, from 90.46% to 84.57%, during that period. This showed that a significant part of the hashrate was borrowed from Bitcoin. It brought about a BTC price decline and destabilized the market.

BTC vs BCH hashrate

Afterward, a lot of exchanges stopped BCH trade and withdrawals.

The founder of Nchain said that the fight would continue until somebody died. Bitcoin Cash ABC won the competition for two blocks in November 2018.

Bitcoin Cash ABC vs Bitcoin Cash SV

As you can see in this graphic, the hash rate of both networks is almost equal. However, in Bitcoin Cash ABC, Proof-of-work was more by half than its competitor’s network.

Bitcoin Cash Hash Rates by Network

On November 16, the Behance exchange distributed both new cryptocurrencies among their consumers equally, and started trading on both pairs. At that time, BCHABC/USDT and BCHABC/USDT were traded at and $287 and $123.62, respectively.

After a few days, BCH ABC got the “BCH” ticker assigned by a huge number of exchanges. The hard fork became the winner of the battle. Their competitor continued to be traded as BCHSV.

Conclusion

In August, a Bitcoin Cash hard fork battle started between two major competitors: BCH ABC and BCH SV. The first group is also called “conservatives,” and is governed by Roger Ver. They are followers of traditional BTC protocol structure and the Canonical Transaction Ordering rule. Their main competitor was Bitcoin Cash SV, headed by nChain. They wanted to implement radical upgrades to the network. Ultimately, Bitcoin Cash ABC won the competition for two blocks in November 2018.

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