A Focus on the Bitcoin Cash Ecosystem: 08 CHIPs

For a completely decentralized network, such as Bitcoin Cash, having a robust process for upgrading the network is of huge benefit to all stakeholders.

In the BCH network, the CHIPs process is the accepted method for effecting modifications, enhancements, or novel introductions to BCH, following a structured and principled approach. A CHIP itself (Cash Improvement Proposal) is a document created within this process and is characterized by several key principles.

Firstly, each CHIP has a designated owner who assumes full responsibility for its progress. This owner can be self-declared, with the singular ownership ensuring clarity and accountability throughout the CHIP process.

Secondly, the creation of a CHIP involves a comprehensive evaluation of all aspects, including technical, economic, and social considerations. This rigorous assessment guarantees that proposals are thoroughly examined from multiple angles.

Thirdly, the default stance towards any proposal is initially set to "preserve the status quo," irrespective of its origin. This cautious approach ensures that all ideas are subject to a rigorous scrutiny process.

A CHIP advances through the process by accumulating public commitment in stages. Starting from "no", individual stakeholders make public statements of gradually increasing certainty, for example, "maybe" and later "definitely, if the CHIP can resolve these issues". This gradual shift in commitment is driven by the allocation of resources and social capital, signifying the proposal's growing acceptance both to the CHIP owner and other stakeholders.

Additionally, the CHIP process includes specific milestones that serve two critical functions. Firstly, they highlight the progression of commitment or the lack thereof. Secondly, these milestones act as a timing and predictability mechanism, determining whether a CHIP, even with broad support, is in time for inclusion in the next annual upgrade, or if inclusion would need to wait for the following year's upgrade. This is important for less engaged actors, who make up the majority of users in any network, to keep their confidence in using the network.

While some may advocate for a more flexible approach, it is imperative to maintain a rigorous process. This is not because the process is flawless, but rather, without at least some rigor and structure, the inevitable need for clarity will result in either complete stagnation (as seen in many "leaderless" cryptocurrencies); or dictatorship and explicit voting, both more coercive options than desired to fill the void.

In summary, the CHIP process on the BCH network is designed to be systematic, accountable, predictable, non-coercive, and gradual, allowing for thorough evaluation and commitment before any proposed changes are implemented. This structured approach ensures the network's stability both in minimizing controversial, reckless changes and accommodating widely accepted, needed changes.

Want to learn more? Follow these links:

CHIPs outline: A process for consensus change
A list of CHIPs on BCH.INFO
A list of CHIPs on BitcoinCashResearch
The CashTokens Chip

General Protocols Blog

This article forms part of the General Protocols Blog, a collection of cross-platform links showcasing our team's community activity, Bitcoin Cash projects, UTXO development, and general crypto musings.