Bitcoin Network Leaders Achieve 2017 Hard Fork Consensus, Bitcoin Price Stronger

The price of Bitcoin appears to be reaching US$450 levels as some Bitcoin core developers and key community leaders agreed to a timetable for a hard fork of the Bitcoin software, which will be activated by July 2017.

The points of agreement were released to the public yesterday on Medium, after a Bitcoin Roundtable meeting at Hong Kong’s Cyberport,

The signatories to the agreement included executives from leading mining companies and pools, namely Antpool, Bitfury, BTCC, BW, and F2Pool, which represent more than 80% of global bitcoin mining power. The three largest exchanges by volume, Bitfinex, Huobi, and OKCoin, were also parties to the agreement.

24 Hour Mining Statistics courtesy of Kaiko.com

24 Hour Mining Statistics courtesy of Kaiko.com

The main points of the agreement are as follows:-

  • We understand that SegWit continues to be developed actively as a soft-fork and is likely to proceed towards release over the next two months, as originally scheduled.
  • We will continue to work with the entire Bitcoin protocol development community to develop, in public, a safe hard-fork based on the improvements in SegWit. The Bitcoin Core contributors present at the Bitcoin Roundtable will have an implementation of such a hard-fork available as a recommendation to Bitcoin Core within three months after the release of SegWit.
  • This hard-fork is expected to include features which are currently being discussed within technical communities, including an increase in the non-witness data to be around 2 MB, with the total size no more than 4 MB, and will only be adopted with broad support across the entire Bitcoin community.
    We will run a SegWit release in production by the time such a hard-fork is released in a version of Bitcoin Core.
  • We will only run Bitcoin Core-compatible consensus systems, eventually containing both SegWit and the hard-fork, in production, for the foreseeable future.
  • We are committed to scaling technologies which use block space more efficiently, such as Schnorr multisig.

The denouement of the consensus agreement, dubbed the “Bitcoin Roundtable Consensus”, is that Segregated Witness (SegWit), a separation of the signature data from blocks to benefit scalability, will be released in April 2016. The code for the hard fork to a maximum of 4 MB will be made available by July 2016, and, with strong community consensus, the hard fork will probably occur one year later in July 2017.

With 80 percent support from mining pools, this hard fork is  likely to be a success where other recent attempts, namely Bitcoin Classic and Bitcoin XT, have failed to achieve the necessary backing.

It appears that some luminaries in the Bitcoin ecosystem were less than excited about the Bitcoin Roundtable agreement.

Former Bitcoin lead maintainer and main backer of Bitcoin Classic and Bitcoin XT, Gavin Andresen, is skeptical about how consensus was achieved.

Brian Armstrong, the CEO of leading bitcoin company Coinbase, clearly feels that Bitcoin Roundtable is behind the curve and not enough of an upgrade to the Bitcoin software.

Armstrong, who recently backed Bitcoin Classic, believes that “less than doubling” the block size through SegWit over the next three months is not meeting the market demand, and that the Hong Kong agreement “reinforces the idea that bitcoin protocol development should be done by a single group”.

Many bitcoin evangelists like Andreas Antonopoulos think it is at the least a step in right direction.

Some market observers believe that the Bitcoin price has benefited from the public release of the Bitcoin Roundtable agreement. For example, Finance Magnates reported that price had rebounded to $450 after the consensus in Hong Kong was reached. While the Bitcoin price appears to have increased around $20 on the day, it has been appreciating all month long, having started month as low as $370.

20160222 BTC Price

Courtesy of CoinMarketCap.com

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