TLDR: Amaury’s IFP is incompatible with Bitcoin Cash for a simple reason: It’s essentially nothing more than one man’s decision to siphon millions of dollars worth of (unearned) Bitcoin Cash directly to his own wallet.
Some call it a tax, and some call it theft, but the label isn’t as important as what is happening: If the BCH network were to accept Amaury’s IFP, millions of dollars would flow into Amaury’s wallet, all without debate, oversight, or accountability. That is simply a non-starter in Bitcoin, Bitcoin Cash, or any other system that purports to be sound money.
On August 6th, 2020, Amaury Sechet announced in a medium post that ABC would be adding a consensus rule to their software that would force miners to divert 8% of the mining reward to “a specific address”.
Prior to the May 15th 2020 upgrade, a similar “Infrastructure Funding Plan” (IFP) had been discussed at great lengths inside of the Bitcoin Cash community. That previous version of the IFP allowed miners several choices (not exclusively ABC) for where their donation would be sent. It also required miner activation. Despite a huge backlash from the community, ABC decided to include this IFP anyway in the May upgrade code.
Despite getting zero support from miners in May, and despite the community backlash, Amaury is now pushing the IFP again, but this time has implemented a version of the IFP that doesn’t require any miner activation, and it only goes to a single address. He says in his article that “this announcement is not an invitation for debate”.
Why is ABC Attempting Something So Absurd?
I stated above that this kind of blatant money-grab has no place in any sound money system, so what makes ABC think they can get away with it?
Historically, most of the mining pools and exchanges have been running ABC software. ABC also apparently controls the BitcoinCash.org website. Thus, because of the forces of momentum and entrenchment, ABC could simply publish whatever code they want, and the network would accept it by default.
(Unless, of course, the changes are so outrageous that the community ,including miners and exchanges, would abandon ABC, which is what is currently happening. More on that in a moment.)
Another reason for ABC’s behavior is that even as a minority fork of Bitcoin Cash, siphoning off a portion of the coinbase rewards would still be lucrative for Amaury.
Let’s revisit my thesis: “It’s essentially nothing more than one man’s decision to siphon millions of dollars worth of (unearned) Bitcoin Cash directly to his own wallet.”
Here are some objections that have been made to this premise:
Myth #1: “But This Wasn’t Amaury’s Decision, It Comes From the Miners!”
The notion that the IFP “came from the miners” is largely inaccurate.
In 2018, a group of Chinese miners and other ecosystem participants met privately, following a Bitcoin Cash conference in Hong Kong. I was present. At that meeting, infrastructure funding via the coinbase was discussed, but it was generally agreed that a voluntary model should be attempted first. But, further discussion in the community fizzled.
Fast forward to late 2019. I attended a Bitcoin Cash celebration in Vancouver and sat next to Amaury on the connecting flight. It was at that time when he explained to me how the total SHA-256 pool would be forced to subsidize BCH. I thought it was a clever idea, and important to help ABC get the infrastructure funding they needed.
In 2020, I took it upon myself to try to help ABC in this way. I contacted BTC.top, ViaBTC, and Antpool and presented our idea. I wrote up a proposal and got them to agree to attach their names to it. I also showed it to Roger Ver of Bitcoin.com, who asked me what the funds would be spent on. After giving him a response, I was told “sounds good” at which time I also included Roger’s name on the proposal.
The rest is history. Once the IFP was “out there” (as a direct result of my own efforts on behalf of ABC), ABC took the ball and ran with it. As I would discover, their goals and attitudes did not align with my own. My assumption was always that this was merely a proposal, and certainly nothing to force upon the community.
So while it is true that the general ideas about the IFP may have started with miners, the specific proposals, implementations, and the aggressive promotion of the IFP came from ABC.
Myth #2: “This Money Isn’t for Amaury & Friends, It’s For Infrastructure!”
During the lengthy discussion about the IFP, some in the community made suggestions along the lines of having 8-12 projects that could be funded. Amaury, on the other hand, proposed setting up a 2-of-3 multisig wallet where he would be one of the signers and the other 2 people ABC loyalists.
As a compromise, ABC implemented a version of the IFP with a very short whitelist. There was an ABC address, a “general” address (which ABC also controlled), along with an address for BCHD and Electron Cash.
With the latest IFP, there is only a single address which is controlled by Amaury and his loyalists. While there is the possibility that some of the funds would be used for projects other than ABC, the current setup gives all power and control to Amaury over the funds. He may use some of the funds for “infrastructure”, but how much and how efficiently will be completely at his discretion.
As predicted by Jonathan Toomim, ABC recently announced there will be a fund that is “managed with the maximum level of transparency and accountability”. Never mind the fact that ABC has never demonstrated much transparency or accountability in the past -- here Amaury will have complete control over this fund since he controls the purse strings, so the implication that the money will be properly managed is somewhere between dubious and laughable.
Myth #3: “ABC Has a Proven Track Record. No One Else Is Technically Competent Enough to Lead the Protocol!”
This rationalization for ABC’s behavior is wrong on multiple levels. First of all, it does not matter how technically competent a team is if they are not creating the right product. This was the entire reason for BCH’s existence. The BTC Core developers were not technically incompetent; they merely were building a different product than what we desired (digital gold instead of P2P cash).
In other words, the technical proficiency of ABC is irrelevant if they’re going to destroy the sound money properties of Bitcoin Cash by inserting a ruinous surcharge into the protocol.
Secondly, the technical competency of ABC is overrated. Yes, It is true that ABC has a track record for keeping the network stable and producing a quality product. They successfully forked away from BTC and beat BSV in a hashwar.
But what has ABC accomplished in the last year? Schnorr signatures -- sure. But that was mostly the work of Mark Lundeberg, not Amaury. Mark is now with BCHN and against the IFP. The other accomplishments include the “minimal data” malleability fix and Sig checks (again both heavily involving Mark Lundeberg), and a small-scope op code, OP_REVERSEBYTES, coded by Tobias Ruck.
More miners are switching away from ABC to BCHN, not just because it doesn’t include controversial code; it is actually faster and more efficient for mining.
ABC is Proving, By Demonstration, Why IFPs Are Problematic
I had made the point in the past that any IFP, no matter how well designed, will inevitably create issues as humans fight over money.
ABC’s version of the IFP (if you can even call it that) is so poor that the issues are surfacing even before it is released. Take myself for example -- in the span of half a year, I went from being someone who Amaury wanted on his 2 of 3 multisig to a political enemy. The project I maintain (Electron Cash) went from being “essential infrastructure” that was included in the first IFP to a project now demonized by an ABC supporter.
The only discernible reason for this change of position is that I am now an IFP opponent rather than a suporter. This is what happens when politics are invited into the protocol.
Amaury’s Plan Can Be Barely Even Be Called an IFP
I don’t want to get caught up in a debate about “IFPs” in general. But for arguments sake, even if an IFP can be an acceptable idea in some situations, the way it is being executed by Amaury/ABC will end in disaster if allowed on Bitcoin Cash for the simple reason that it is done without oversight, without accountability, without debate, without checks and balances.
I don’t know where the line is between “responsible Infrastructure plan” and “blatant cash grab”, but clearly ABC’s implementation falls on the side of the latter. The fact that ABC alone controls the keys is sufficient to establish this.
BCHN and the Decentralized Revolution
Bitcoin Cash Node (BCHN) is a fork of the ABC software that was created during the first IFP as a drop-in replacement. It is now set to become the de-facto replacement for ABC due to ABC’s over-the-top behavior.
Bitcoin is a resilient system and is proving that indeed -- the revolution will not be centralized. As soon as anyone tries to make themselves the king and take power that isn’t theirs, the system will react and accordingly route around them, like water trickling downhill.
It is also important to remember that there are six full node implementations in Bitcoin Cash (BCHN, BCHD, Flowee, BUCASH, Knuth, and Bitcoin Verde). It is not ABC vs BCHN but rather Amaury Sechet vs Bitcoin Cash.
In summary, Amaury’s actions amount to little more than a thinly veiled attempt to extract money for his personal benefit, and/or to intentionally create a fork of Bitcoin Cash. And, very few sane developers or investors will support his efforts.
Goldman Sachs to Trade Bitcoin Futures Goldman Sachs, one of Wall Street's biggest banks, has restarted its cryptocurrency trading desk, according to a March 1 Reuters report.
It will trade Bitcoin futures as well as non-deliverable forwards within its Global Markets division.
The banking giant is currently exploring a Bitcoin-focused exchange-traded fund. On top of that all, it wants to dabble into cryptocurrency custody.
Back in March, there was tons of speculation about Goldman venturing into crypto trading, but the plan was then shelved. Back in April 2019, the bank denied that it even intended to open a trading desk for cryptocurrencies in the first place.