You may have heard of BIP-110; This is why this fork is not only bad for Bitcoin, but it was built on a misunderstanding of which Bitcoin node is good. Also, because of this misunderstanding, BIP-110 will fail.
This story is a Take it. The views expressed are those of the author and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
BIP-110 and Bitcoin Improvement Proposal called Reduced Data Temporary Softfork. BIP calls for a coordinated change to Bitcoin, which attempts to limit the types and amount of unedited data that can be added to legitimate transactions by limiting the ability to record Bitcoin information. BIP-110 is led by a manufacturer known as Dathon Om and is heavily supported by the Knots community, another Bitcoin startup led by one of Bitcoin Core’s biggest contributors, Luke Dashjr and his supporters.
The BIP-110 consensus change is moving towards the official approval period in the coming weeks and thus becoming a fork that contains the main consensus rules as used in Bitcoin Core. The project must get a lot of support from miners in the coming weeks to change the Bitcoin contract. As at the time of writing, the mine symbol of BIP-110 stands at less than 1 percent.
The Knots group, which is made up of Bitcoiners who run nodes on machines like First 9 and Umbrellahas been circling the Knots in opposition to several development decisions made by Bitcoin Core, the open source community and the implementation of Bitcoin. Although many of the major Bitcoin developers are against or indifferent to the changes proposed by BIP-110, the movement has gained enough steam to become a topic of ongoing discussion on social media.
Supporters of BIP-110 believe that by using Bitcoin all that shows a change in agreement, they alone can change Bitcoin. Here are the main ideas being discussed, the most common misconceptions about the Bitcoin consensus, what a Bitcoin node is, and why BIP-110 is about to fail.
Powers and Limits of Bitcoin Nodes
Much of the disagreement and misconceptions in the recent cultural debate within Bitcoin surround the idea of a Bitcoin full node. Influencers such as Knut Svanholm, author and podcaster, have raised the position of the entire node to the height perhaps closest to the sun.
Knut recently tweeted: “Every person on Earth is a node in the Bitcoin network. Many to a lesser extent, of course, but each node is first and foremost a person, not a machine. The tools we use to connect to the network (and, in addition, to the extent that they affect the network) depend very much on the decisions we make.”
These words are poetically beautiful, noble, romantic, even romantic, yet they are inconsistent and meaningless. Knut’s tweets attempt to redefine the meaning of ‘Bitcoin node’ and fail, instead devaluing the term entirely. He may have even said that every atom in the universe is a Bitcoin point, since apparently for him the term is universal.
Knut, despite his good intentions, is flawed. A Bitcoin node is a very special thing. It is a complete book of Bitcoin history, block headers and transaction related data. Its purpose is specific: to allow users to verify the integrity of Bitcoin access and transaction history in accordance with Bitcoin’s consensus rules.
Bitcoin nodes offer users various benefits, such as privacy. Third party wallet providers query their Bitcoin blockchain at the user level and return it to the user via the wallet app. Most mobile wallets work this way, where users ask a third party server for their measurements; others, very few, can connect to user-managed Bitcoin sites, where users’ public addresses are not shared with the third-party wallet company.
Another advantage of Bitcoin nodes is that they give users the opportunity to see if they are compatible with the rest of the network, to stay connected. If a user mines Bitcoin or supports a high level of hashing power to the Bitcoin proof network, the node also offers the possibility to collect a log, to decide what goes. This is only possible if the user is able to mine the Bitcoin block, which is successful today, due to the difficulty and high competition.
Even new types of mining pools like Ocean, which try to decentralize block template creation, allowing miners to have influence on what comes out of the chain, still have enough hashing power to win the proof-of-work competition, causing sporadic blocks to be mined and therefore less power on the blockchain.
Bitcoin nodes also send events to the network, and thousands of them communicate through the network flood; this leads to the creation of an anti-censorship system where a few nodes can find arguments for miners, bypassing all kinds of filters, as shown Peter Todd’s relay for free. Therefore, Bitcoin nodes cannot easily filter the data that enters the blockchain.
Even most of the Bitcoin nodes themselves cannot, however, change the Bitcoin contract. Not without having many financial services that enter the Bitcoin network through them, as the exchange does on behalf of millions of users. Not without having a set of protocols and programs that follow them. Not without having business people behind them. Bitcoin is not a node democracy, contrary to popular memes today.
Bitcoin nodes do not give you ‘citizenship’ in ‘Bitcoin nation’. Satoshi Nakamoto was very clear about this Bitcoin white paper. The main security of Bitcoin and its management is: CPU cycle, one vote, not one Bitcoin node, one vote. And the miners, who run in the CPU resources for the proof of work of Bitcoin, are very affected by the opinions of investors and developers, which leads to the creation of a distributed system of money that is difficult to change.
Bitcoin nodes eventually let you know if you’re connected to the network with the most proof of work and that its consensus rules are being followed, but the point itself doesn’t allow you to change the consensus rules. Users who change the consensus rules of a Bitcoin node are, by definition, no longer running Bitcoin. As a result, changing the Bitcoin contract as a node runner is very difficult, and it is a phenomenon, not a bug. Bitcoin is money for enemies.
History and Bitcoin Consensus Games
In-depth work has been done, trying to understand the relationship between Bitcoin, its various pillars and interest groups. Ren Crypto Fish, Steve Lee and Lyn Alden identified six of them The cost of BCAPan open effort to analyze Bitcoin’s consensus and risks in upgrading the protocol. BCAP identified its stakeholders as Economic Nodes, Investors, Media Influencers, Miners and Protocol Developersand Users and Software Developers
Historically, when there is a consensus problem, it is true that Bitcoin nodes have been used to show support for one type of Bitcoin over another. Fork events like the Bitcoin Cash fork of 2017 are often cited as examples of financial institutions winning against opponents. 2017’s legend User Activated Soft Fork (UASF) met with great opposition in doctrine; Most of the mining pools and the corresponding group hashrate helped Tracking 2x Bitcoin brand, and exchange with many organizations after signing a bad reputation New York Agreement.
A Bitcoin node-backed soft fork still won, breaking Segwit2x’s version from a rival blockchain. But that’s it: when Bitcoin nodes succeeded technically, they did so with the great support of protocol developers, investors and media influencers: these nodes had financial weight and agree with each other aggressively. BIP-110, on the other hand, has no protocol developers, nor does it have enough money behind it. Michael Saylor has argued against it, with many industry leaders also publicly opposing or avoiding the issue altogether.
In fact, on the Bitcoin Cash fork, the limits of Bitcoin trading were clear. A Bitcoin node that is controlled by an exchange is a much stronger authority than a commercial one, because it introduces a large number of new transactions to the Bitcoin network. A Bitcoin node of a large mining pool is more powerful than that of an individual miner, because it often collects blocks and decides which ones are fixed to the blockchain.
Most Bitcoiners outside of exchanges use mobile wallets to access their Bitcoin. Such users and investors can ‘vote’ with their money, so to speak, by moving their bitcoins and financial services elsewhere, be it to a wallet that supports their Bitcoin vision, or their general principles. But while users remain on mobile wallets that talk to other people, users have no control over the Bitcoin contract. And many mobile wallets are using a Bitcoin core-compatible back end.
The same goes for exchanges; users effectively provide contract decisions to exchange partners. In some cases, the exchange has put the relevant issues to the vote of the user, evaluated by all their assets, returning the decision to the end users who have been evaluated by the center; we can see this happening again with BIP-110.
This type of polling will start happening with Foundry today. One of the largest Bitcoin mining pools in the world, Foundry, soon email letting his miners know that they can vote for the idea with their hashrate. Long enough support may result in the Foundry signing to BIP-110, although this is unlikely. Non-voting users will demonstrate against BIP-110, protecting the status quo. So the lack of attention on the topic of BIP-110 could be the success of Bitcoin Core by default. Supporters of BIP-110 should win the majority of the Foundry hash event, which should take steps to vote against the Bitcoin Core agreement, the most popular Bitcoin implementation and the best codebase.
Today, miners do not show support for BIP-110 in any significant way. In fact, according to some data, this is one of them few supported soft forks to test and mine Bitcoin history. Under a hundred of the blocks mined in the transition period shows BIP110.
Final Thoughts
BIP-110 has so far failed to find consensus among the main interest groups within Bitcoin; even the developers, investors, miners, or large financial groups that support the reform of the union. The result could be the division of the chain in the coming weeks, which would have a major impact on the lightning wallets running on the BIP-110 compatible chain, eventually it will lead to a new blockchain, but a small one that would have to change the proof of services used to keep it alive.
