Bitcoin Roundtables: Overview and Q&A with BitFury’s CEO on Major Controversies

Last month has been quite fruitful with events being held with a single aim to reach an industry-wide consensus on Bitcoin network scaling. Bitfury Group, the world’s leading Bitcoin Blockchain infrastructure provider and transaction processing company, initiated the first Bitcoin Consensus Roundtable back in January, with two other meetings to follow later. The second Roundtable, that took place on February 11th, made us hear the “call for consensus” from major mining companies and a few exchanges. In a few days, on February 20th, the other meeting was initiated to end up the other day with so-called “Bitcoin Roundtable Consensus” after many hours of opinions exchange.

Just as a quick reminder, the attendees of the second Roundtable agreed mainly on:

  • Block size to be increased, and Segregated WItness will be deployed.
  • Bitcoin Classic will be rejected (just as any “contentious hard-fork”).
  • Bitcoin Core developers to work on a roadmap including blocksize increase via hard fork within next three weeks.
  • Future changes of the consensus rules to be done in a safe way, while all bitcoin contributors and developers are to work together on scaling roadmap despite their differences.

The third Roundtable held in Hong Kong has been attended by many more industry representatives, including CEOs of bitcoin companies and Bitcoin Core contributors.

A great summary of the meeting results has been provided on Reddit:

Criticism: Could we call this a stable, industry-wide off chain consensus?

One might think Bitcoin is saved – at least it seems to feel much better after the meeting. However, there are still some sceptical voices in the community drawing attention to problems yet unresolved.

The participants might have not fully represented their groups of influence

This issue arose as early as February 24th (three days after the consensus had been signed), when F2Pool announced in a bitcointalk post:

“We will withdraw support from February 21’s roundtable consensus, unless Adam Back gives us a reasonable explanation why he quietly changed his title from the President of Blockstream to Individual at the very last moment — without anybody noticed. We feel we’ve been cheated. I don’t know how we can trust Blockstream anymore in the future.”

Adam Back has later asked to change his title under the consensus agreement back to the Blockstream President, however, some community members expressed doubt that the agreement remains valid as long as its text has been modified AFTER everyone signed it.

Same goes for Core developers present at the meeting, who dubbed themselves “Bitcoin Core Contributors” to stress that they cannot speak on behalf of the entire Bitcoin Core team nor the Bitcoin code contributors of all times. As Segregated Witness developer Peter Todd highlighted in his tweet posted during the meeting:

Mining pools are not individual miners

Technically speaking, the representatives of mining pools were not delegated by the individual miners. This means that the agreement is not binding for all pool participants.

This problem is being addressed by the recent F2Pool initiative to give individual miners an option to vote by their hash power (in this case for Bitcoin Classic). If the experiment turns out to be successful, the concept might spread, thus bringing about a more “decentralized” mining in terms of political power distribution. This is not a “real” switch to Bitcoin Classic as there is no opportunity to mine BC blocks from what we know.

No Classic team at the meeting

This remains a major concern as no members of the alternative development teams or open Classic supporters were present at the third Roundtable due to last minute invitation or no invitation at all.

As Jonathan Toomim commented:

“Samson Mow invited both me and (IIRC) Jeff Garzik. He invited me about 48 hours before I would have had to step on a plane to get to Hong Kong in time for the meeting, and I was not able to arrange for my datacenter to be taken care of in my absence, so I didn’t go. Jeff was given a similar amount of advance notice.”

Similar comments have been made by some other Classic supporters, such as Coinbase CEO, Brian Armstrong:

“Some journalists asked me if Samson invited me to the Hong Kong conference. I didn’t have any email/facebook/wechat message record of it but figured I could be mis-remembering so I asked Samson. He said he believes he invited me verbally, but couldn’t confirm 100%. I don’t remember either, and he may be right. So neither one of us is sure. He may have mentioned it off hand in one [of] our chats. I also wouldn’t say I was formally invited if I never received an email or written message about it,” Brian said.

Is July 2017 too late for a hard fork?

As Core team suggests, the Segregated Witness will resolve quite a few issues of network efficiency, simultaneously paving a road for a future hard fork:

“The SW SF is pretty elegant already. The reason the HF is based on it, is because SW is the cleanest way to fix some serious problems of just increasing the block size. Pre-SW, a 2 MB block could literally have taken several hours to verify (exponentially increasing with size). SegWit makes these steps instead a linear increase in complexity/verification time,” explained Core developer, Luke Dashjr.

It has been said that dates stated in the Roadmap are based on the estimated time required to write and test the code, and nothing else.

“July 2017 is the latest deadline for the hard-fork, it may be possible sooner, using a different type of fork if there’s a widespread agreement from users, miners, exchanges and ecosystem companies to do that,” said Adam Back.

Other issues: What’s wrong with an average block size right now?

According to chain.btc.com the average block size has gradually increased during last few days eventually reaching 1mb limit:

BlockSizeFull

This lead to a 40 mb mempool creation as Roger Ver hinted in his tweet:

At first it used to be credited to a “regular spamming attack” to encourage miners to immediately adopt Bitcoin Classic. However, the scale of the inefficiency is quite huge. Still, the share of low fee transaction is higher than regularly and significant hashpower fall right after last difficulty increase has been observed.

 

Valery Vavilov: CEO and Founder of BitFury Group

Valery Vavilov: CEO and Founder of BitFury Group

To address those issues and to get more insights into the Consensus Roundtable results ForkLog (FL) asked BitFury CEO Valery Vavilov to comment.

FL: Why were there no main Bitcoin developers except for current members of Bitcoin Core among signers? Were they at least invited?
Valery Vavilov: The goal of the consensus roundtable was to provide a venue where Bitcoin Core Developers, Bitcoin Classic teams, and other stakeholders including representatives of Bitcoin businesses, could meet and discuss the block size increase, Hard/Soft Forks, Nodes & Blockchain, SegWit, Lightning Network and other important issues. All thoughts and input were welcomed. The organizers reached out to everyone who wanted a seat at the table. Given all of the stakeholders and their varying time zones some people were unable to attend. Overall, we believe it was very inclusive and came together quite well.

FL: Do you think it will be not too late to hard fork in 2017? Why so?
Valery Vavilov: Waiting 1.5 years before the hard fork takes place should provide ample time to minimize any potential risk of the split. It will take time to go through the multiple steps of implementation. The first step will take place in April 2016, as we prepare the software for a smooth transition. It will start with the implementation of separate SegWit transaction storage. The second step will happen in early fall 2016. During this time, software will be fully tested and ready for implementation in Q3, when we will see significant improvement in scalability with a smooth block size increase for transaction growth (SegWit with about 2mb block effective storage). The third step will be in mid-2017, when we could have a hard fork and significant scalability improvement. The Core roadmap provides this balanced plan, with these multiple stages, from now until July 2017. In July 2017, after the miners’ vote, the hard fork will be activated and will deliver up to 6-7 times the amount of transactions than is currently the case.

FL: What are the implications of this consensus for Bitcoin mining industry and specifically for BitFury?
Valery Vavilov: BitFury believes that consensus is very important so the dynamic and exciting Bitcoin Blockchain industry can keep moving forward at full force. There are many benefits to industry-wide consensus, but most importantly, it will increase the scalability of the Bitcoin network and how we manage differences in opinion will speak volumes toward how community is able to proceed further into the mainstream and garner additional public trust.
One might say the Roundtables lead to even more controversy, including the Satoshi Roundtable that took place on February 28th. However, the results should be considered positive by hard fork proponents, and now it’s time for other discussions related to how and when the industry will make a new step. The Bitcoin Classic developer Jeff Garzik suggested in his tweet:

Finally, the Roundtables also make people talk to each other, and that’s what the community has been missing for a long time.

by Eugene Muratov