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Ethereum Hard Fork at Block 7,080,000 in January 2019

Ethereum Hard Fork at Block 7,080,000 in January 2019

The Ethereum development team has come to an agreement to deploy the Constantinople hard fork at block 7,080,000. Currently, Ethereum is near block 6.86 million, so this fork should happen some time between 14-18 January 2019.

The Constantinople hard fork was supposed to deploy in November 2018 but when had failed when deployed on the testnet in October 2018. After the failure on testnet, developer Afri Shchoedon made the accurate forecast that a fork was unlikely in 2018.

Ethereum has declined from USD 1,400 to less than USD 100 during 2018, and numerous companies and platforms launched via Ethereum are facing increasing enforcement pressure from the Securities and Exchange Commission (SEC) for unregistered issuance and trading of securities. This perhaps makes January 2019 a less than ideal time for a hard fork of the Ethereum blockchain, but the developers do not have much of a choice due to the difficulty bomb.

The difficulty bomb is programmed into Ethereum to cause blocks to become exponentially slower after a point, which eventually leads to an ice age where no more blocks are mined. This forces the developers to hard fork Ethereum periodically, and the point of this is to make sure Ethereum keeps on getting updated with the latest technology. The difficulty bomb is not going to be removed in the Constantinople fork, just delayed another 18 months.

The Constantinople hard fork may cause contention between investors and miners since it lowers the block reward from 3 Ether to 2 Ether. On the other hand, investors should welcome a lower inflation rate of Ether supply. However, miners have been struggling due to the collapse of Ethereum’s price and slashing the block reward by a third during this time could be seen as inconsiderate.

Lowering the block reward is already a heated issue but the Ethereum developers are rushing to implement ProgPoW, which would make ASICs incompatible with Ethereum mining. This move is likely to disenfranchise most of the major Ethereum miners.

The debate over this fork will intensify over the next month as the fork approaches and an Ethereum split is not out of the question, since the developers appear to have different views from the miners who are securing the network. Ethereum has already split once due to a hard fork over the loss of the development fund, since some of the community did not agree in reversing any transactions even if it was a hack, and this is how Ethereum Classic was born.

Yet another version of Ethereum could easily be born if a fraction of miners coordinate and decide not to upgrade their nodes to Constantinople. Indeed, miners who use ASICs have nothing to lose by doing this, since if ProgPoW is implemented their hardware will instantly become worthless unless they can succeed at keeping the current version of Ethereum alive.

 

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Reddit Founder Claims Crypto Market Needs a Crash Before Take Off

Reddit founder Alexis Ohanian has remarked in an interview with CNBC that he believes that a crash in the cryptocurrency market as seen over the past few days is needed in order for the market to stabilize and mature over time.

The Reddit entrepreneur feels that focus on software development and infrastructure within the cryptocurrency industry are important factors in building a stable future. He also suggested that the falls in cryptocurrency prices would have the effect of sifting out the undesirables in the industry from the genuine contributors, and those in for making quick money.

The Reddit founder feels that innovations being created now will have longevity and although blockchain pitches he has received may be fewer in number, Ohanian claims that they have more potential than those he was receiving in 2017.

Over the last few days, Bitcoin has suffered its biggest losses in over eight months. Although, after falling to USD 5,202 on 15 November, after a little price correction, trading picked up today at $5552.17 (time of writing). The newly hard forked BCH has fallen by 15% and is trading at $387.41. Brian Kelly, the founder, and chief executive officer of BKCM, has blamed the hard fork for the crypto market crash. Mati Greenspan from eToro says he saw it coming:

“The movement we saw today seemed to be the run-of-the-mill volatility surrounding Bitcoin and a breakout that’s been weeks coming….It’s difficult to say where it ends. No one can really predict.”

Forbes contributor Clem Chambers noted a correlation to the spike in the bond market:

“The obvious culprit causing this dump is Bitcoin Cash, the ‘wannabe’ Bitcoin usurper, which forked from Bitcoin last year. It is forking again and there are competing forks and all sorts of conniptions are expected. It sounds plausible this is causing the move but the fact the bond market spiked at the same time suggests something else is going on to me.”

Stephen Innes who heads up trading at Asia Pacific of Oanda Corporation suggested that the crash was an even worse scenario than he had anticipated and that pre-BCH online chat had the effect of creating doubt and uncertainty among investors.

Ohanian sticks with his view that the crash is necessary, arguing that during hard times people start to focus on the essentials.

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Ethereum Constantinople Hard Fork Fails On Testnet, Making Ethereum Fork Unlikely In 2018

The Ethereum Constantinople hard fork has been the focus of the Ethereum development community, and it is meant to bring a full suite of upgrades to Ethereum. Constantinople was deployed on the Ethereum Ropsten testnet at block 4.23 million on 13 October 2018, but it failed to work. Due to this failure, Ethereum developer Afri Schoedon thinks the Ethereum hard fork is unlikely in 2018.

no constantinople in 2018, we have to investigate

— 𝙰𝚏𝚛𝚒 𝚂𝚌𝚑𝚘𝚎𝚍𝚘𝚗 (@5chdn) October 13, 2018

After the Constantinople hard fork was implemented on the Ethereum Ropsten testnet it didn’t produce a block for 2 hours, and the first block it produced had zero transactions. At this time on 14 October, the Ropsten testnet is at block 4.236 million, but it is unclear if the testnet simply reverted back to original Ethereum after Constantinople failed.

A couple of different reasons have been given for the failure of the Constantinople hard fork on the testnet. Shoedon reports that there was a serious consensus issue, with a 3-way fork forming between Geth, Parity, and another Ethereum client.

Another reason given for the fork was that miners had simply not upgraded their nodes to Constantinople, so there was no one to mine blocks, explaining the stall at block 4.23 million. Ethereum developer Peter Szilagyi pleaded for other developers to start up a node running Constantinople to get the testnet blockchain moving.

Whether it is true or not that the lack of miners is the reason for this Constantinople testnet failure, it highlights how Constantinople has been very contentious for Ethereum miners. Constantinople lowers the block reward from 3 Ethereum to 2 Ethereum, which is catastrophic for many Ethereum miners that are already struggling. Ethereum’s price has declined from over USD 1,000 to less than USD 200 during 2018, making an intractable situation for most miners. Peer to peer pawning sites like LetGo and OfferUp are filled with Ethereum miners trying to liquidate their rigs since they are no longer profitable, even before this update.

On the other hand, Ethereum investors want Constantinople since it would lower Ethereum’s inflation rate. This creates a direct divide between miners and investors, making a community and blockchain split likely if the Constantinople hard fork included a block reward reduction. Ultimately, the miners get to decide which version of Ethereum is dominant, and in this case, the miners are not in agreement with developers, and there is nothing forcing them to implement this version of Constantinople.

There is a piece of code included in Ethereum which causes mining difficulty to exponentially increase at a point, this is called the difficulty bomb and leads to an Ethereum ice age where no more blocks are mined. This would be catastrophic for both miners and investors. This will force the Ethereum community to reach a consensus before the difficulty bomb goes off, or Ethereum will stop working. So if the Constantinople hard fork is not coming in 2018, certainly in 2019 some version of an Ethereum fork will be necessary to make sure the Ethereum ice age doesn’t happen.

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Steem Blockchain down a Week Before Hard Fork

The Steem blockchain has gone down according to official announcements on the Steem Twitter, and the Steemit forum has been down for most of the day on 17 September 2018. Its Twitter says it are working hard to fix the problem and have repeatedly said it will tell people soon what is happening, only saying it is not a hack but have yet to give any details about what caused the Steem blockchain to fail. This has occurred only a week before the Steem velocity hard fork scheduled for 25 September.

We’re aware of the problem with the #Steem #blockchain and are hard at work to get it resolved. We’ll post updates here as they happen.

— Steem (@SteemNetwork) September 17, 2018

Steemit is a popular decentralized forum with some 60,000 accounts active each day on Steemit and 250,000 unique visitors per day. Users can send each other Steem tokens to curate posts, and the sudden and unexpected failure of the Steem blockchain is likely causing economic loss for users that depend on it for income. Steem has a market cap of nearly USD 200 million and daily volume of several million US dollars; today the price declined by more than 5%. The developers assert that everyone’s coins are safe, however, and there is no hack, but it is unknown when Steemit will come back online.

The Steem blockchain is currently frozen.

Steemit is arguably the world’s most popular dApp, with over 60,000 unique accounts making transactions each day and over 250,000 unique visitors each day.

This is what those visitors are seeing right now. 👇pic.twitter.com/wz055UFPuV

— Kevin Rooke (@kerooke) September 17, 2018

The Steem blockchain failure has occurred only a week before the Velocity hard fork scheduled for 25 September. Previously, Steem allotted users a certain amount of bandwidth but that will be changing to a new system where users have resource credits which determines how much they can post. The curation window will be shortened from 30 minutes to 15 minutes to fight against bots, and a protocol is being implemented to cancel out the vote from people who vote for their own posts. A new system will be implemented where people can create accounts at a discounted price with an account discount token.

Although the code for the velocity hard fork has already been completed, perhaps the developers will include another modification to ensure the Steem blockchain doesn’t crash anymore like it has done today, since this event is severely disruptive for the Steemit ecosystem.

 

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Ethereum Devs Consider Hard Forking Every 8 Months

Ethereum developers have so apparently decided to hard fork Ethereum every eight months.

This was the conclusion of a regular meeting conducted over YouTube on 24 August 2018. Some were even suggesting every six months but that was considered too much pressure for the team. A fork called Constantinople is coming soon.

Developers agreed that delaying hard forks to perfect Enterprise Integration Patterns (EIPs), the Ethereum equivalent of Bitcoin Improvement Proposals (BIPs), was not ideal. They have opted to activate many hard forks that release only ready EIPs, instead of fewer hard forks that release as many EIPs as possible. The latter would have delayed EIPs that are ready to launch.

To put this in perspective, Bitcoin has no set schedule for hard forks. The Bitcoin community has historically been resistant to any hard forks, with each accompanied by controversy and discontent. Generally, Bitcoin hard forks are reserved for true emergencies, like the Value Overflow Incident when a hacker created 184.4 billion Bitcoins.

Setting a precedent for forking Ethereum every eight months could affect predictability concerns. The block reward, mining algorithm, coin supply, block time, and anything else imaginable can potentially be changed every eight months. This might make it riskier to hold Ethereum since a fork could always destabilize price. Compare this to Bitcoin, where the protocol is basically set in stone and fundamental characteristics are very unlikely to ever be changed.

Ethereum developers have also decided to leave block reward decisions to the community, setting the stage for a battle between miners and investors that could lead to multiple forks of Ethereum. In general, every Ethereum fork could lead to different versions of Ethereum splitting off, and now it’s going to be a regular occurrence every eight months.

Even in the best case scenario, if the entire community agreed with these forks, there would still be users left behind on old chains if they aren’t keeping up to date on the news. This can lead to widespread loss of funds due to people sending Ethereum from addresses on the old chain to addresses on the new chain.

On the flip side, perhaps frequent forking can be conducive for Ethereum to evolve more rapidly than cryptocurrencies like Bitcoin which avoid forks.

Knowing the crypto community though, slight code changes generally lead to debates and fighting that can be quite damaging, let alone forks which are an even more extreme scenario. It’s perhaps unintentionally symbolic that the coming Ethereum fork is named Constantinople, the old capital of a fractured piece of the Roman Empire.

 

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