Jihan Wu, co-founder of bitcoin mining equipment maker Bitmain, has rebutted a statement made yesterday by Gregory Maxwell where he says that a “design oversight” in Bitcoin’s proof of work “has a potential attack which can allow an attacking miner to save up-to 30% of their energy costs.” Maxwell further stated:

“Reverse engineering of a mining ASIC from a major manufacture has revealed that it contains an undocumented, undisclosed ability to make use of this attack.”

Emin Gün Sirer, Cornell Professor, has disputed this claim, saying that “there’s absolutely no independently confirmed evidence of ASICBOOST actually being used on any chip.”

Jihan Wu, Bitmain’s co-founder, has now confirmed AsicBoost is not being used in production. He told CCN.com:

Bitmain has only tested ASICboost on testnet and never used it on main net in production. We also believe that those who accuse us of using ASICBoost privately should provide direct evidence. ASICBoost is implemented, plus it is not used publicly, does not imply that it has been used in some very weird private ways.

Maxwell further stated that the optimization can block “virtuous improvements,” by which he means Blockstream’s proposal of segregated witnesses.

In response, Jihan Wu said:

“Bitmain signed the HK agreement and we support SegWit as long as there is a block size bump up hard fork. So it cannot claim that Bitmain is against SegWit.”

The Hong Kong agreement was signed last year where almost all miners as well as Adam Back, Peter Todd, Matt Corallo, Luke-Jr and other developers agreed to merge segwit plus a 2MB hardfork. Segwit was delayed, but merged, the hardfork was never even publicly pull requested as far as it’s known.

A new proposal was made two days ago, extension blocks, which implements a modified version of segwit to allow for the deployment of the Lightning Network while also increasing on-chain capacity to 3MB with an upper bound of 9MB.

Jihan Wu came out in favor of the proposal. CCN.com has learned that F2Pool also supports extension blocks. However, Blockstream appears to be very much against it. The reasons are not clear, but a schism now appears to be developing between Blockstream and Lightning Network developers.

Maxwell’s statement is probably an attempt to divert attention from the extension blocks proposal or any efforts to reach a grand compromise on this never ending debate. However, Blockstream is now put to proof on their allegations.

If they are unable to provide any evidence that AsicBoost is being used in production, then this seemingly PR effort may once more backfire, but we can be sure that their alleged troll army may keep repeating unfounded allegations as facts.

However, these latest developments do not bode well for a potential solution to the transaction capacity stalemate. Considering the response of some to the extensions blocks proposals, many may now begin speculating that Blockstream actually does not want any increase.

Indeed, Matt Corrallo, a former Blockstream employee, has said that 1MB forever is “not the end of the world. People can and do use Bitcoin today perfectly well, and many of the designs people have for second-layer systems work great today (LN being an exception, though it does still work).”

If that is indeed the case, it remains to be seen whether other Bitcoin Core developers and supports keep standing by Blockstream when digital currencies, such as ethereum and litecoin, keep seeing 50% price increases in a day, while bitcoin’s price seemingly remains stagnant, with its market share dropping.

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