Blockchain, Coinbase CEOs & Andresen Rail Against Bitcoin Core for Not Reacting to Network Challenges
Based on views of some prominent attendees from the Bitcoin community, the second Satoshi Roundtable was yet another important meeting about the future of Bitcoin that produced no consensus or agreement for a short-term blockchain scaling solution.
The event is invitation-only and organized by Bruce Fenton, the current Executive Director of the Bitcoin Foundation, and was held on the last weekend in February at an undisclosed location in North America. Fenton describes the Roundtable as “a small group of leaders involved in Blockchain technology: developers, CEOs, investors early adopters etc. who meet for a weekend retreat.” The list of attendees included about seventy high provile members of the Bitcoin community, including core developers, miners, and CEOs of Bitcoin companies.
After last year’s two Scaling Bitcoin workshops and the latest “Bitcoin Roundtable” in Hong Kong, the organizer of the latest Satoshi Roundtable undoubtedly was hoping that it would be successful at achieving a broader consensus. While the “Hong Kong compromise” at Bitcoin Roundtable included more than 80% of the Bitcoin network’s mining power, there has been concern across the Bitcoin ecosystem the compromise’s date of July 2017 for a block size upgrade was too late.
Gavin Andresen, former Bitcoin Core maintainer, attended the recent Satoshi Roundtable and believes there isn’t really a consensus behind the “Hong Kong Compromise”. He notes this regarding consensus on the “Hong Kong compromise” at the event:
At one point, everybody was asked if they supported the “Hong Kong compromise” from the week before (segregated witness in April, then code for a 2MB hard fork in July of 2016 with a minimum of a year before 2MB blocks are allowed).
“Everybody who support that, raise your hand” : a dozen or so people, most of whom were part of that Hong Kong meeting, raise their hands.
“Everybody who does not support that, raise your hand” : everybody else (forty? fifty people?) raises their hands.
I think the organizers of the conference were hoping for some sort of consensus (like what happened in Hong Kong), however it became clear by the end that the divide was too great.
While he enjoyed the larger group sessions at the Satoshi Roundtable for the passion showed by individuals an new projects, Peter Smith, the CEO of Blockchain, also had issues with the small side bar sessions:
It became clear at those that large parts of the industry no longer share the same vision nor are they likely to pragmatically compromise to avert what I view as serious risk of running out rocket fuel before we get the ship to orbit.
It is evident that Smith, Andresen and Armstrong believe that current group in charge of Bitcoin Core has no interest in developing a scaling solution for the Bitcoin blockchain itself.
Over the last year of trying, and failing, to reach a reasonable compromise, it has become clear to me that some developers don’t want any on-chain scaling solution any time soon. They believe more theoretically elegant (but technically complicated) off-chain solutions like the Lightning Network are a better long-term scaling solution, and they believe that by resisting a simple limit increase we will get to that long-term solution faster.
Armstrong appears to be even more pessimistic about relying on the Bitcoin Core developers:
Even though core says they are ok with a hard fork to 2MB (they have it on their own roadmap, just very far in the future), they refuse to prioritize it. They prefer to withhold something that could help the network now, because they don’t trust the community to make educated decisions in the future. They view themselves as the central planners of the network, and protectors of the people. They seem ok with watching bitcoin fail, as long as they don’t compromise on their principles.
Smith laments control of the Bitcoin network’s development by a small group and in what he believes to be inappropriate reaction by that group to dire network symptoms:
To discount these network issues as being merely related to ‘spam’ is equivalent to a limited group of people adjudicating what the bitcoin network is for. Most importantly however, it is a dangerous game, with far reaching implications, for the industry or developers to begin declaring which transactions are ‘good’ and which are ‘attacks.’ If Bitcoin is to be an open network, central planning of what type of transaction is acceptable shouldn’t be acceptable.
The three Bitcoin ecosystem stalwarts have there own warnings on what could occur if there isn’t a block size limit upgrade in the near future. Armstrong warns about risks of having 70% or more of blocks in the Bitcoin network full as the July 2016 halving date approaches. The Coinbase CEO also believes that the current Bitcoin Core developers are the most significant systemic risk to Bitcoin.
Andresen argues that off-chain solutions will emerge that are highly centralized “clearing” agreements between exchanges and miners and merchants or merging of miners and transactions creators. An example of such an agreement is the one that Chinese mining giant and exchange operator BTCC announced last year for its customers.
Smith warns that activity on the Bitcoin network demonstrates that it is producing less value at a higher cost, with transactions taking longer, average fees rising significantly, and the price falling.
Armstrong and Smith are implementing Bitcoin Classic, an alternative to the Bitcoin Core code with a 2MB block size limit upgrade, at their companies, and Andresen is a lead developer on the project.