While Bitcoin soars behind the scenes the loom of the ‘Hard Fork’ grows ever stronger but that suggests two roads will the outcome. This is highly, in fact we’ll go with, wholly, unlikely.
In the case of Bitcoin, if you have a Hard Fork at 75% in the mining pools it means the remaining 25% will (at a likelihood of over 90%) contain a miner who controlled at least 16% of the original hash rate. This 16% miner in the smaller chain will now maintain 16% of the remaining 25% (that’s 64%) and hence more than the <50% proviso.
Anyone care now to extrapolate what will occur in a Hard Fork? Well, here we go:
Time 0 (at the fork):
- Chain 1 – a decentralised mix of miners and pools with 75% of the original hash rate, blocks at 13.3 mins average.
- Chain 2 – highly centralised group with a single entity controlling >64% of the chain. Blocks at 40 mins average
Time 1 – 2016 Blocks on the main chain (at worse case, just over 8 weeks later, due to hash rate loss):
- Chain 1 – hard to guesstimate
- Chain 2 – Still in the original difficulty, it is expected that 8 weeks need to pass but they only have just over 5 weeks to change
Time 2 – If the chains survive (a very unlikely scenario):
- Chain 1 – Will pool power move from a centralised control point to the larger chain?
- Chain 2 – A single miner can have total control
Result? Both cannot survive. The fork makes the miners centralised and this kills the chain, it is not like Ethereum and PoW. Forks wither in Bitcoin.
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