A tale of two coins

This will be very different from most of my posts. It is a tale of two coins. One of them does not have a name yet, but they have things in common.

I will show you things from the coin that does have a name. For now the name doesn't matter. I have blurred it out in the initial parts of the post. I'm trying to draw attention to the plans, the execution, and the result. Names don't matter much.

What follows are some explanations and positioning quotes from the coin's whitepaper. Just so we all have an idea of what it's about. They are fairly central tenets and objectives. The thing it wants this coin planned to do well. I will focus heavily on the governance component. My readers can guess why. Sometimes I highlight stuff I find interesting.

I'll just mention from the table of contents, that the coin had a lot of other goodies on its menu:

• Schnorr signatures

• POW

• SHA256 mining

• Reduced confirmation time (1 minute vs Bitcoin Cash's 10 minutes)

• Reorg protection similar to BCH - but 30 blocks deep, instead of 10

• Same DAA

• No premine, no ICO

• The aforementioned Governance Fund

• Annual reduction of mining rewards by 20% and annual halving of governance fund amounts

• Tail emission by stopping block reward reduction after about 20 years

So, definitely an experiment, and willing to admit that it is an experiment too.

(NOTE: replay protection against BCH isn't mentioned.)

I am guessing most of you have never heard of this coin, despite it offering itself as a testbed for new BCH technology, and apparently aiming to incentivize BCH development through some kind of symbiosis with its management fund aka Governance Fund. Am I right?

I won't keep you in the dark anymore about the coin. It's called FreeCash (FCH), and it's a fork of Bitcoin Cash executed on January 1, 2020.

About its relationship to BCH, they publish this (highlights are mine as usual):

I want to say that the coin is still active, has published (at least) two Contribution Assessment reports (basically, they have a process to allocate their governance funds via this assessment). Arguably, and I'm looking on this as an outsider, they did a decent job on their governance experiments (I had a look at the first PDF report published in English via Tor, the second report was in Chinese only, I could not find the English version).

They drew some lessons from their governance experiments that are actually worth reading - I quote only some extracts but you can find more in [5].

This brings me to a conclusion.

A coin was created, a fork of BCH, earlier this year.

It was very much a tree falling in a forest.

I have not yet spoken about the other coin that does not have a name yet.

It shares the following characteristics with Bitcoin Cash (BCH) and FreeCash (FCH):

• Schnorr signatures

• POW

• SHA256 mining

• Plans for reduced confirmation time (they claim they will be able to implement Avalanche-based confirmation within 1 second)

• Reorg protection similar to BCH

• Same DAA

• No premine, no ICO

• Plans for a Governance Fund, also funded from coinbase rewards. Details scant, not all worked out yet.

• (No replay protection towards BCH)

Would it be safe to assume a similar result for an action which is so similar?

Time will tell, I guess.

In the meantime, those embarking on the second attempt might do well to study the lessons already learned, and to recall two sayings:

“Those who cannot remember the past are condemned to repeat it.”
- George Santayana, The Life of Reason: The Phases of Human Progress, Vol. I, Reason in Common Sense (1905-1906)

and

“Insanity is doing the same thing over and over again and expecting different results.”
- 1981 October 11, The Knoxville News-Sentinel: Al-Anon Helps Family, Friends to Orderly Lives by Betsy Pickle (Living Today Staff Writer), Quote Page F17, Column 2, Knoxville, Tennessee.

Final Note: It is perhaps unfair to use Freecash as an comparison example. They were marketing themselves as an experiment to some extent after all, although they were being quite ambivalent about it. In a competitive environment, I can't really tell whether they wanted to compete, or not.

What I'm confident about, is that competition is tough, and once you reach close to the end of the cryptocurrency ranking, it is extremely hard to recover.

From that, I will draw the lesson that even sincere attempts at governance are no magic bullet for success.

References:

1. Whitepaper: https://freecash.org/pdf/whitepaper-en.pdf?v=0.2.4

2. BitcoinTalk announcement: https://bitcointalk.org/index.php?topic=5212666.0

3. Subreddit: r/FCH

4. The Relation between FCH and BCH , a post from its subreddit

5. Problems and Improvement of Freecash Contribution Assessment

6. https://quoteinvestigator.com/2017/03/23/same/#note-15768-2

Lead image: Photo by Andrew Ly on Unsplash

Second tree image: Photo by Nick de Partee on Unsplash

Portrait of George Santayana by Samuel Johnson Woolf (1880-1948), Time magazine, from Wikipedia, in the public domain.