BCH Hash Wars: Ripple’s David Schwartz Had Warned the Crypto Community about Miners
As the Bitcoin Cash (BCH) Hash War continues to affect the crypto markets, Ethereum World News went back in time to see if such an event had been predicted and how it could have been avoided. In the process of going through our archives, we came across a piece written back in August about how the XRP ledger was more decentralized than both the Bitcoin and Ethereum networks.
Based on a post written by the current Chief Technology Officer at Ripple (David Schwartz), it explained to the crypto community that the mining power of both Bitcoin and Ethereum was held by a select few.
Flaws of Proof-of-Work in the Networks of Bitcoin, BCH and Ethereum
In the informative post by David Schwartz, he explained that four mining groups controlled 58% of the Bitcoin network and three miners account for 57% of Ethereum’s daily capacity.
He went on to add that:
80 percent of the mining on the Bitcoin blockchain is centralized in China, despite the country’s ban on digital assets. This puts it at greater risk of being manipulated by a single, sovereign government.
Some experts even suggest that in a worst case scenario, miners of Bitcoin and Ethereum blockchains could use this to their advantage — conspiring to rewrite history on the blockchain through a 51 percent attack that results in verified transactions being unvalidated and allows for fraud to occur.
Bitcoin Currently At the Mercy of Miners
Although his comments did not refer to Bitcoin Cash directly, we can see the congruencies of his statements with the currently ongoing Bitcoin Cash Hash War. We can also conclude that David Schwartz had seen the possibility of miners rewriting the history of Bitcoin.
With both camps of the dispute – Bitcoin Cash ABC and Bitcoin Cash SV – vowing to fight to the bitter end, hash power will most likely be redirected from Bitcoin to Bitcoin Cash thus undermining the BTC network and the value of the digital asset.
The Illegality of Diverting Hash Power from BTC to Bitcoin Cash
Craig Wright, who supports the Bitcoin Cash SV version, has pointed out the illegality of Roger Ver’s Bitcoin.com redirecting hash power to BCH. He did so via a tweet that stated the following:
Please remember, the penalties for defrauding customers are a multiple of the amount taken.
When they re-direct your hash illegally, we will help you teach them a lesson
Pre-Mined Coins and Consensus Protocols Look Very Attractive Right Now
Proof-of-Work networks such as those of Bitcoin, BCH and Ethereum, thrive by incentivizing miners to validate transactions. In the case of the XRP ledger, its consensus protocol does not have such incentives and requires that 80% of the validators be online for 2 weeks to support a change on the network.
The Stellar network also operates using a Consensus Protocol. The Tron Network uses Delegated Proof-of-Stake which uses a reputation system and real-time/continuous voting to achieve consensus.
In the brief explanation of the networks behind XRP, XLM and TRX, we get a rough idea at how consensus protocols offer far better network stability than the Proof-of-Work protocols of BTC, BCH and ETH.
As a result, the three coins of XRP, XLM and TRX might become the fan favorites of many traders and investors after the current hash war is over.
What are your thoughts on the current Bitcoin Cash hash war? Please let us know in the comment section below.
[Image courtesy of Ripple.com]
Disclaimer: This article is not meant to give financial advice. Any additional opinion herein is purely the author’s and does not represent the opinion of Ethereum World News or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.