Hard Fork is Dangerous

Contentious hard fork is uncertainty and uncertainty means volatility of bitcoin price. Naturally people are scared about it. But, the reality is hard fork is inevitable in bitcoin. In the long run, we can not avoid it. Today it is about block size, tomorrow it may be required to accommodate an unit smaller than satoshi on the blockchain and the day after tomorrow it might be a move towards SHA512 or higher due to invention of quantum computer. I understand those are far future or these situations might not arise at all, but there is a necessity to define a path for a hard fork, if needed.

Bitcoin Parameters can not be Altered

Total supply and periodic block halving are the two parameters that can not be altered. In fact, I believe, if proper consensus mechanism is in place, we will never be able to achieve a consensus to change the total supply and periodic block halving. But, block size limit, divisibility or mining algorithm are not what defines the core nature of bitcoin. They are defining the blockchain in a certain shape & form and with consensus, we may change it.

Achieving Consensus

Consensus means a general agreement. But, in bitcoin world, it is very difficult to reach a general agreement as there is no central authority. Instead, if we had a constitution, it would be easier to define a general agreement. Hence, I am trying to define an unofficial constitution for bitcoin, that may be used to determine representation of various stakeholders of the bitcoin network.

Bitcoin Constitution

Preamble: Primary two stakeholders of the bitcoin network are miners and holders. Both of these two categories are invested for the success of bitcoin and it is also possible to gather their opinion with mathematical proof, which is verifiable in a decentralized way, i.e. without trusting any central authority. Mining pools can vote through coinbase scriptSig and miners can reflect their opinion by pointing their hash power to the preferred pool. Evaluation can be done through implementations like BlockTrail or Coin Dance. On the other hand, holders can sign agree or disagree with their bitcoin address in regards to a certain opinion. One such implementation to evaluate holders opinion can be found at Bitcoinocracy.

Process of Evaluation:-

1. At least 21 bitcoin should support a hard fork proposal to be discussed. A poll, created on Bitcoinocracy and backed by 21 bitcoins, will suffice for Hard Fork to be discussed by miners. Please note that, 21 is an arbitrary figure. The exact figure can be discussed or voted on by the community before accepting this proposal.

2. More than 50% hash power should support the proposal for at least 21 difficulty period. This can be determined using BlockTrail or Coin Dance. Please note that, both 50% and 21 are arbitrary figure. The exact figure can be discussed or voted on by the community before accepting this proposal.

3. More than 50% coin must support the proposal, where the total amount of coins participating in the poll is more than 1% of the total supply. This can be determined using a poll on Bitcoinocracy. Please note that, both 50% and 1% are arbitrary figure. The exact figure can be discussed or voted on by the community before accepting this proposal.

Process of Implementation: Any hard forking change should give the network enough time to be aware, test and upgrade. Hence, I propose, all hard forking changes are pushed together only at the time of block reward halving, i.e. once in every four year.

Multiple Implementations of Bitcoin node

Some controversial changes are being implemented in bitcoin core in the form of soft fork. There are visible contention against Segregated Witness and Replace by Fee. But, as the network primarily run on bitcoin core, those who will keep running versions that does not have these implementation, will turn into a relay only node. So, I see, there is a requirement to make room for the opposition voice for Soft Forks. This can be done through multiple implementations of Bitcoin node. A clear constitution, that defines Hard Forking changes, makes it easy for multiple implementations of Bitcoin node to co-exist.