Monday, January 27, 2020

The other day I tweeted the above as a joke. It was meant to be funny because the amount of debate surrounding the funding initiative was so insane. Just take a look at the front page of read.cash and you'll get a hint of what I'm talking about. Between here, Twitter, r/BTC, and the various BCH related Telegram channels, I wouldn't be surprised if over a million words have been written "debating" the new funding initiative.

So far, I have been a vocal proponent of the funding initiative, but the truth is, I have gone back and forth on this issue multiple times. My initial reaction was in favor of it, then talking to various people on telegram had convinced me I was against it (which was why I moved my coins out of cold storage). Then after a night of sleep, I woke up the next morning and had decided I wasn't going to sell my BCH, that I would support the initiative, and try my best to help others understand my position.

Perhaps I saw no other option. Perhaps I was putting too much trust in the four names that signed the initiative, and all the high profile developers who were for it as well. But another day has passed, I've read more tweets and articles and comments, and now I'm back to square one.

The other day I described to someone that I felt like a tennis ball being whacked back and forth by people who were smarter than me. Well, I guess I was just whipped cross court by another wicked forehand last night.

I've explained my reason for supporting the initiative already, but one thing I don't think I touched on was how I felt the plan was inevitable. That's certainly how it was dropped on the community. So given the situation, I believed that even though orphaning blocks wasn't ideal, I thought we had no other options. Maybe that's still the case, but I'm now convinced it's at least worth testing that theory.

We have a little less than four months until the May upgrade. That's not a ton of time, but it's better than nothing, as long as we don't waste too many hours bickering and debating but instead spend our time coming up with better solutions.

imaginary_username has already gotten the ball rolling with his "Assessment and proposal re: the Bitcoin Cash infrastructure funding situation". It's the first post to earn over $1000 on read.cash, and it's easy to see why. I reread it again last night, and between his article and various conversations on Twitter, I've kind of come full circle to where I was a year ago when the whole Bitcoin ABC funding issue first started to rear its ugly head.

At that time, I was not an Amaury supporter. I thought all he did was complain, and all he cared about was money. I put the blame on Bitcoin ABC asking myself why couldn't they come up with a budget to attract investors/donations? But then I saw Amaury's presentation at the Bitcoin Cash City Conference and I did a full 180 on him. I am still convinced Amaury and Bitcoin ABC are our best shot at helping BCH become the best money the world has ever seen. That opinion hasn't changed, but I do wonder if a mining cartel that threatens to orphan blocks by miners that don't pay a 12.5% tribute to developers is the right answer.

So what is?

I don't know, but I'm intrigued by imaginary_username's "Holder contributions" proposal. Essentially he proposed 6 whales that own at least 100,000 BCH to give up 3% of their holdings in order to raise the $6M that was targeted by the funding initiative. You can read about his proposal in the linked article above, but it got me thinking it would be tough for me to give away 3% of my BCH. 1% would be more palatable, and .5% even more palatable still.

So how much is $6M worth of BCH? As of last night, when 1 BCH = $360, it would take 16,667 BCH to reach $6M. So let's say to match the goal of the initiative, we need to raise anywhere between 15,000 to 20,000 BCH.

I did some back of the napkin math, and if we assume there is roughly 8M BCH being held by members of this community, mostly held by whales, what % would every one of us have to give to reach that 16,667 BCH number? The answer is .2%. So for every 10 BCH you own, you'd only have to donate .02 BCH. Assuming every member of the community did the same, and the community does in fact hold 8M BCH, the initiative could be met by a .2% contribution by everyone. I know this is unrealistic. The freerider problem is real and chances are there will be plenty of people that don't contribute. So the real number is probably closer to .5% or more, and ideally there would be a mechanism in place where we can put our BCH into some escrow account, and if the funding goal isn't met, the BCH is returned. This is also discussed in imaginary_username's article, but this would be a way for members of the BCH community to donate to a developer's fund without coercion, and contributors can feel comfortable donating their money without having it go to waste in the event that no one else donates.

But the funding mechanism is only half the story. The fact is, people aren't going to donate unless they believe their donation is going to actually make BCH better and increase the value of the BCH they still hold. This is where we need the help of the developers, specifically Bitcoin ABC. I don't think it's too much to ask for at least a rough estimate of how these funds would be spent. Perhaps go through the remaining items on the roadmap and estimate what it would take to get those items done. My understanding is that budgeting for software projects is extremely difficult. That makes sense given how complicated software development is, not to mention the ongoing maintenance that is required long after the code is written. But a rough budget is better than no budget.

This community has less than four months left to avoid a potential cataclysmic split within the community. There's plenty that's unknown, but based on what I've seen these last few days, I'm pretty confident that if this plan goes through as is, it could set BCH back as badly as the 2018 hash war did. I believe the split with BSV was necessary and ultimately in the best interest of the BCH community. I don't feel the same way this time.

I don't know if I'm adding anything to the discussion. Maybe my posts are just adding to the noise. Maybe I've been swayed by the fact that the posts that are against this proposal are getting literally thousands of dollars in tips on read.cash while the posts that are in favor have earned ~10% by comparison. But money talks, and it is telling me that a significant number of BCH holders are vehemently against this plan. As a result, I have been swayed to consider other options. But many questions remain. Is the community going to be able to raise 15 times the amount of BCH raised by the last fundraiser? Is it possible for Bitcoin ABC to come up with a budget proposal that is realistic and makes sense? If the money did get raised, would that mean the five mining pools will call off the proposal? And how would any raised funds be deployed?

Are the whales even watching?

The one thing I do know is that over the past few days, this community has demonstrated a ridiculous amount of knowledge and passion as it pertains to the future of peer to peer electronic cash, and I hope we can do whatever it takes to prevent it from yet another split. Maybe you might think the community is so small anyway and we can afford to lose people so long as we find a way to get new people to join. My counter to that is another split is the last thing we need to accomplish that.

Thanks for reading.