In fact, miners would not earn anything as long as they support the wrong set of rules. It is an intriguing concept to think about, and it is not hard to see why so many people would favor this approach. After all, bitcoin is currently “directed” by the miners, even though they are only a part of the ecosystem as a whole. In the second part of the episode, the duo outlines the various soft fork upgrade mechanisms, ranging from MASFs , flag day activated UASFs and mandated signaling UASFs. Once a change is put in place, any nodes that fail to upgrade to the new consensus rules can no longer participate in the consensus mechanism. They are forced onto a separate chain the moment the hard fork takes place.
The two differ from each other in terms of compatibility with the other chain and their applications. Miners can always attack any chain at any time, but must do so by exerting real opportunity costs – they have to stop mining for profit. In the case of a chain split, this kind of attack would actually be beneficial – it would allow the chain to reach a difficulty retarget period faster.
The scaling debate made it clear that BIP9 was not ideal for implementing upgrades. Usually, a start time is proposed to allow miners to signal support for the upgrade. Once 95% of the bocks produced signal support, the upgrade gets locked in and becomes active after 2016 blocks.
How can we show support for BIP148?
The older yellow nodes are unable to recognise the blue nodes and reject them as a result. The blue nodes remain connected to each other and can continue transactions. Three distinct parties are largely responsible for modifications within the bitcoin network.
To this day, nodes that haven’t been updated to SegWit still participate in the soft-forked Bitcoin network. BIP148 requires support from the economic majority, particularly exchanges and wallets. If this does not occur, node software supporting BIP148 should not be run after August 1st as it will cause a chain split leading to the abandonment of BIP148. There are strong economic incentives in the Bitcoin system for nodes to cooperate and remain in consensus to prevent chain splits. If the economic majority is signalling as of August 1st, miners have many incentives to follow along. Not following along would make it difficult to sell coins mined after August 1st as the blocks would not be accepted by the economic majority.
A node is a discrete member of a network which interacts with other nodes to form the network. Bitcoin nodes store and validate the blockchain and exchange blocks and transactions with one another in order to maintain consensus. When a hard fork occurs, the community members must make a decision. They can either update their node and switch to the newly-forked chain, or they can keep running the old software. Either way, they own cryptocurrency on both chains; they have coins on the legacy chain from before and they can claim the new protocol’s cryptocurrency on the new chain.
Accidental and intentional forks
In general, the block signalling mechanism is only supposed to be a coordination method that makes accelerated activation possible. It’s a mechanism by which miners trigger activation of soft forks when a majority signals the readiness to upgrade. This allows for a faster activation time for the soft fork, leaving full nodes to upgrade at their leisure.
Why BIP148 and not a direct flag day UASF for Segwit?
At any given moment, thousands of miners are competing to create a new block. With so much mining going on at once, two or more miners sometimes mine a new block at the same time. The problem is solved when new blocks are added to one of the chains. When that happens, the network continues working on the longer chain and abandons the shorter one.
Bitcoin Explained – The Technical Side of Bitcoin
Stack Exchange network consists of 181 Q&A communities including Stack Overflow, the largest, most trusted online community for developers to learn, share their knowledge, and build their careers. While, initially, the idea was controversial within the small block camp, by May 2017 it had gained significant traction. The Dragons’ Den was now in full campaign mode, supporting BIP 148 and the UASF.
All You Need To Know About Cryptocurrency: Types, Benefits, History and More
UASF and MASF are simply two mechanisms of implementing such changes. In the first part of the episode, Aaron and Sjors explain that URSFs are best considered the mirror equivalent of UASFs with mandated signaling. Where UASFs will towards the end of a soft fork activation window reject blocks that don’t signal readiness for a soft fork, URSFs will reject blocks that do signal. If both UASF and URSF clients are deployed, they would in principle create a split in the blockchain. This was created in October 2016, when a group of developers rejected new rules that were implemented with a hard fork.
It is quite intriguing to think of a soft fork as something users can opt-in for. This makes a lot of sense to less tech-savvy users, as everyone deserves their voice to be heard. It also gives the people who don’t like either Segregated Witness or Bitcoin Unlimited another option that looks appealing. Unfortunately, a UASF still has its drawbacks, as implementing a user-activated soft fork is not easy by any means. Plus, it can still result in a bitcoin fork, which is the last thing the ecosystem needs right now. However, for a modification to be made to the bitcoin network, these parties must reach a consensus about it.
Although the original and the copy share a common purpose and history, the split is done to solve an issue considered a problem in the original version. In mid-June, the exchange ViaBTC, which was linked to Jihan Wu, listed BIP 148 futures on the platform. This was clearly an idea taken from Bitfinex a few months earlier and their Bitcoin Unlimited token.
This type of attack requires a majority of hash power colluding to orphan valid blocks that have been mined. This kind of attack is always possible in Bitcoin, but can be defeated by changing the Proof of Work. These types of attacks are discouraged due to economic incentives- there typically is more to gain by cooperating than attacking. Rather than requiring a specific amount of network hashpower – 95% in the case of Segregated Witness, or 75% in the case of Bitcoin Unlimited – a user-activated soft fork is triggered in a different manner.
To him, a UASF undermined the narrative he had built that miners had significant influence over the protocol rules. On May 28, 2017, Jihan Tweeted with the tag #UASF alongside a picture of the murder victims of the Jonestown massacre. Meanwhile, our approach at the time was to allow miners to decide for themselves by voting through their mining accounts.
The first is BIP 16 which ostensibly activated via a flag day (i.e. all blocks after a certain time must support BIP 16). However the flag day was determined only after a certain threshold of miners signaled support for BIP 16 in their blocks. So while the code was a flag day, the process was still a miner activated soft fork, just done manually rather than through code. For future soft forks, it is likely that a combination of BIP 9 and BIP 8 will be used. You can then determine whether it was miner activated or user activated.
In September 2014, Pieter Wuille discovered a divergence in the way OpenSSL handled DER-encoded signatures on different platforms. This could be used, for example, to create a block that would successfully validate on Linux but fail on Windows—making it possible for an attacker to create a targeted chain split. Wuille and a few other developers privately developed the patch for a soft fork that would ensure all signatures used the same format. BIP66 was created for the change and advertised publicly as a step towards removing Bitcoin’s dependency on OpenSSL .
A fork means that there is a change to the consensus rules of the Bitcoin network. The upgrade being a “soft” fork means that it tightens the rules and requires it to be backwards compatible so that nodes running older versions of the software can still validate new blocks. The “user-activated” aspect was what made it unlike any upgrade before it, as we’ll explain below. In the midst of the conflicting interests, another proposal surfaced.