The Blocksize War tells the story of the debate in the Bitcoin community about the optimal size for a block of transactions in the blockchain. The block size limit is 1 MB, but some proponents (the big-blockers) argue that it should be increased to allow for more transactions to be processed per second, while others (the small-blockers) believe that the limit should remain in place to maintain the security and decentralization of the network. The events of the book took place from 2015-2017, but the debate has not yet been definitively resolved and remains a topic of ongoing discussion and disagreement among members of the community.
The sides
Small-blockers refers to individuals or groups in the Bitcoin community who advocate for maintaining the current block size limit of 1 MB or only making limited increases to it. Small-blockers believe that increasing the block size limit too much would centralize the network and make it more vulnerable to attack and censorship, as well as negatively impacting the decentralization and security of the network. They also believe that there are alternative solutions to the scalability challenges facing Bitcoin, such as off-chain transactions and second-layer scaling solutions, that can help improve the efficiency of the network without increasing the block size limit. I consider myself a small-blocker.
Big-blockers, who advocate for larger block sizes and a more rapid pace of scaling for the network. The debate between small-blockers and big-blockers has been a key source of controversy and disagreement within the Bitcoin community and has played a significant role in shaping the direction of the network.
Major events
The Hong Kong Agreement was a consensus reached among Bitcoin developers and stakeholders in February 2016, during a meeting in Hong Kong. The agreement aimed to resolve the ongoing debate about the block size limit in the Bitcoin network, which had resulted in a split in the community known as a "fork." The Hong Kong Agreement called for a block size limit increase to 2 MB, as well as the implementation of several technical upgrades aimed at improving the scalability and security of the network. The agreement was seen as a significant step towards resolving the block size conflict and reunifying the community, but its implementation has faced challenges and obstacles, and the debate over the optimal block size limit continues to this day.
The New York Agreement (NYA) was a consensus reached among a group of companies and organizations in the Bitcoin community in May 2017. It was signed in New York and aimed to resolve the ongoing debate over the block size limit in the Bitcoin network. The NYA proposed to increase the block size limit to 2 MB and implement a technology called Segregated Witness (SegWit) to improve the scalability and efficiency of the network. Segwit alone effectively doubled the blocksize, and was ultimately implemented into Bitcoin, though the large blocks were not.
The NYA was seen as controversial by some members of the community, who opposed its proposed changes to the Bitcoin protocol and felt that it went against the decentralized nature of the network. The agreement and its aftermath have been seen as a significant turning point in the history of the Bitcoin community and its ongoing efforts to scale and improve the network.
The Forks
The big-blockers and small-blockers eventually divorced, and elements of the NYA was eventually implemented as part of the contentious Bitcoin Cash fork, which created a new cryptocurrency with a larger block size limit.
Bitcoin Cash (BCH) was created in August 2017, motivated by the disagreement in the Bitcoin community about how to scale the network to handle an increasing number of transactions.
The key difference between Bitcoin and Bitcoin Cash is the block size limit. While Bitcoin has a block size limit of 1 MB, Bitcoin Cash initially increased this limit to 8 MB in order to allow for more transactions to be processed per second and to make the network 'more scalable'.
Bitcoin Cash has been a controversial addition to the cryptocurrency space and its legitimacy as a true version of Bitcoin is a subject of debate among many. Despite this, it has grown to become one of the largest cryptocurrencies by market capitalization and has a dedicated following of supporters.
BSV is a cryptocurrency that was created as a result of a hard fork from the Bitcoin Cash (BCH) blockchain in November 2018. It is an abbreviation for Bitcoin Satoshi Vision, which refers to the 'original vision' for Bitcoin as outlined by the pseudonymous creator Satoshi Nakamoto. BSV aims to restore the original protocol and principles of Bitcoin as outlined in the Bitcoin whitepaper, including its focus on peer-to-peer electronic cash transactions, security, and decentralization.
BSV has been controversial within the cryptocurrency community due to its association with its creator, Craig Wright, who claims to be Satoshi Nakamoto but has not provided any definitive proof. The currency has also faced criticism for its centralization, with a small number of miners controlling a significant proportion of its hash power, and an ever-shrinking number of nodes due to the 4GB block size and total blockchain size surpassing 8TB. It has been soundly rejected by many businesses and exchanges. Despite this, BSV supporters believe with religious fervor, that it represents the true vision of Bitcoin, that Craig Wright is actually Satoshi Nakamoto, and BSV will eventually replace BTC as the top dog-- I say good luck.
I was involved in the Bitcoin space during this period, but I never new this level of detail about what actually happened. If you are interested in this pivotal time in Bitcoin's history, this book is a must-read or listen.
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I learnt some new things here. Cheers!