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Bitcoin Fork - Smoke Mirrors and A Game Of Poker

In this article I present the facts as I see them and leave it to you to reach your own conclusions. My opinions are my own and I encourage you to do your own due diligence. I could be wrong. It is your hard earned money.

Rehashing and analysing the figures over the period of the fork it is clear now that Bitcoin Cash had a difficult birth. Looking back I am convince that it would have been highly unlikely to succeed. I think what eventually happened was planned and executed by persons unknown who clearly wanted Bitcoin Cash to succeed. The key is to analyse the available hash power and look at how it was applied.

Refer here to Jimmy Song's article on how the Emergency Difficulty Adjuster (EDA) kicked in. Before it can be activated at least 12 blocks must be mined! ( The UAHF specifications. Starting block 478557.)

The First 12 Blocks
                                                     ( Approximate Time Lapse between blocks)
August 1st 2017   AM  8:16:14
August 1st 2017   PM   1:12:41     4 hours 56 mins
August 1st 2017   PM   1:33:06                  21 mins
August 1st 2017   PM   1:37:19                    4 mins
August 1st 2017   PM   1:52:58                  15 mins
August 1st 2017   PM   2:37:44                  44 mins
August 1st 2017   PM   4:05:15      1 hour  28 mins
August 1st 2017   PM   4:35:44                   30 mins
August 1st 2017   PM   4:39:21                     4 mins
August 1st 2017   PM   6:38:29      1 hour   59 mins
August 1st 2017   PM   8:07:01      1 hour   29 mins
August 1st 2017   PM   9:51:49      1 hour   44 mins
August 1st 2017   PM  10:15:01                  23 mins

Looking at the figures I would say roughly there was about 1 hour between blocks. At the same difficulty of BTC's 6500 Peta Hashes producing 10 minute blocks, we will need at least 1/6 the hashing power to produce 1 hour blocks. That is about 1200 Peta Hashes.


                             BTC     BCH    TOT           BTC     BCH         BTC       BCH         BTC
                               ( Hash Power )                 ( Difficulty)           ( Block Time )    (mempool)

31 July                 6163                                     860                        
1 August              6440      1525      7965         860        860           9.66         160              5
2 August              6433       378                        860        860           9.47         205              5
3 August              5931       447                        860        860         10.43           41            10
4 August              7749       216       7965         860        225           8.04           75            23
5 August              7473       143       7617         860        225           8.13         110              5
6 August              6023       499       6612         860        114          10.28          22              3
7 August              6637       551       7188         860        114            9.41          18            33        
8 August              6835       154       6989         923        115            8.78          62            35
9 August              6200       541       6741         923        115          10.43          15            43
10 August            6165       576       6741         923        115          10.74          14            42
11 August            6600       338       6938         923        115          10.00          21            55


Prior to 1 August the highest amount of hash power recorded was on 24 July at 7118 Peta Hashes. This is roughly 1000 PH over total hash power on 31 July. We can therefore be sure that at least this amount of hashing power was available and at least 678PH was "floating" and withheld from the system. The maximum hash power ever applied to the BTC and BCH chains was 7965 PH in total on 4 August.

We know we need at least 1200 PH mining on the BCH chain on 1 August to find the first 12 blocks. From the above table we can see in red that there was at least 1500 PH available and I believe this was directed to mine the BCH chain. Without this input, it would have taken about 3 days to mine the first 12 blocks and the BCH chain would have been a failure.

The Morning After

Once EDA kicked in, the BCH chain is assured of survival. The next objective is to get the block time down to 10 minutes and profitable mining as soon as possible. Or is it? Hashing power was taken off BCH chain on the 4 and 5 August to trigger the 6 blocks difficulty reductions and again on 8th August for 1 additional reduction The BCH chain was left at 15 minutes about 4 blocks every hour.

In addition on 4 and 5 of August about 7500 PH of hashing power was applied to the BTC chain. Was this done to push up the next difficulty adjustment to 923G on 8 August and possibly higher at the next difficulty adjustment? (Bitcoin Wisdom)

This "floating" 1500 PH was withdrawn on 6 August. As of 11 August there is still at least 1200 PH of hashing power "floating" and withheld from the system. So who is this mystery miner or miners? What is their intention ?

The Aftermath

We can see that on 9 August about 600 PH was withdrawn from the BTC chain pushing the block time above 10 minutes. The result is that the BTC chain is clogging up with low fee transactions and the mempool has already reached 57MB. Only those willing to pay high fees can get their transactions processed. Unless there is a fast injection of mining power this chain is in trouble! It does not have the protection of EDA and the Chain Death Spiral can easily set in if not already started.

Voila as if by magic, today, 11 August 500 PH was returned to mining the BTC chain and 250PH was taken off the BCH chain. This still leaves about 1000PH still "floating".

Over the whole of this period BTC stayed above $3200 and went above $3500 yesterday and $3700 today. All of Bitcoin mainstream was celebrating, attributing it to CORE and Segwit.

I believe that this celebration is premature. BTC rise could be the result of world tensions in regards to the USA and North Korea, a worsening global economy and gold not making any impact, The situation must be bad enough for investors to just ignore and overlook BTC's vulnerability. Currently BCH, which I believe to be the real Bitcoin, is selling at a bargain.

Beware Smoke And Mirrors

There is much going on behind the scenes. Nothing is what it appears. Hashing power is being used to influence and manipulate the market. The high BTC price is great for those wanting to sell their BTC and accumulate BCH. This will result in a major wealth transfer from those holding BTC to those holding BCH. I believe that the true Bitcoin will flip from BTC to BCH but that is just my opinion.

A Great Game Of Poker

In this game, very few people are showing their hand. The Bitcoin whales have gone into deep dive and have not been seen or heard from since the chain fork. When the time comes to show their hands there will be winners and losers. I think that the unexpected rise and strength of BTC price is a complication but it will not change the "game plan".

I can only present the facts as I see them and the conclusion I draw are my own. You could easily form a different opinion looking at the same facts but that is your right. In the end when the tide goes out we can all see who is without clothes.

In this environment I am guided by principles. The reality in Bitcoin is that there is no Government to rule and favour any faction or group. It is nature at its' purest. Only the strong survive and any weakness is punished. I believe in its' current form BTC has a vulnerability (No EDA) and that will lead to its' demise. Three months is a long time in crypto.

Related Articles

Chain Death Spiral - Here

BTC is Dead - Long Live BTC - Here

BTC is Dead - Long Live BTC Updated and Explained ELI5 - Here


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