Five years of forks, all turned into laughter

Author: Crypto_David, Deep Tide TechFlow

What were you doing five years ago?

On that day, Web3 had not yet emerged, the ancestor of NFTs, CryptoKitties, had not yet been born, DeFi had not yet encountered its exclusive summer, and running could only make you sweat without earning money.

And on that day (August 1, 2017), Bitcoin welcomed a hard fork at block height 478558, resulting in a new coin called BCH (Bitcoin Cash).

The historical reason is that Satoshi Nakamoto initially set the block size of Bitcoin to only 1MB. Faced with the increasing transaction volume, with a block produced every 10 minutes containing a limited number of transactions, the Bitcoin network became increasingly congested. To "scale Bitcoin," BCH proposed increasing the block size to 8MB to solve the congestion problem, thus giving birth to BCH based on Bitcoin.

As the narrative continues to update, some things seem to have begun to cycle again.

Five years later, as the Merge phase of Ethereum approaches, those who still wish to stick to PoW are also trying to imagine forking a new Ethereum chain like BCH.

At that time, airdrops had a sweeter name, called "candies." Holding BTC in a wallet/CEX, waiting for the snapshot, then joyfully discovering more BCH in hand.

People's desire for sweetness does not fade with time. Today, you can still hold ETH, wait for the fork to begin, and then joyfully discover more ETH fork coins in hand.

However, no matter how sweet the candy, it seems to have an expiration date.

Their poison, my honey?

Is the candy you once held still sweet?

In fact, Bitcoin has faced many forks throughout history. Due to the lack of consensus in the community regarding scaling and other technical implementation plans, any faction or force can initiate a hard fork and create a new coin (candy).

What are the outcomes of different branches?

Regarding forked coins, seasoned investors have likely heard of BCH (Bitcoin Cash), BSV (Bitcoin Satoshi Vision), Bitcoin God, etc., and at that time, there was even a discussion about "who is the real Bitcoin." On the Ethereum side, there is also ETC (Ethereum Classic), known as the doomsday vehicle.

But who is the "real" and "classic" one? Let’s first discard the technical and ecological measures and make a rough judgment based solely on price.

A brief analysis reveals:

1. Among all forked coins, only ETC's current price is higher than when it was created.
2. Even so, if you held the forked coins from the day they were born and sold them precisely at their ATH, you would find that the relative increase is still not as good as holding BTC and ETH from that day.
3. Some forked coins reached their ATH in just a few months, but then plummeted.
4. Considering applications and ecology, the branches (forks) struggle to shake the mainstream position; all factors are already reflected in the price (ETH vs. ETC).

Time will answer growth, and the community will reveal our appearances.

As the lyrics say, five years later, BTC and ETH have grown from geek experiments into consensus that cannot be ignored. Meanwhile, forked coins are relatively disappointing in terms of ecology, consensus, and price.

Learning from history, if you receive a piece of honey, it’s best to consume it early; otherwise, it may turn into poison.

Does the butt decide the brain, will this ETH fork be different?

You might say: The forked coins of BTC have little practical use beyond payments, but ETH is different; it has a whole set of applications and narratives beyond payments.

Will this ETH fork be different?

Let’s first return to the previous forked coin, ETC. ETC was forked due to a hacker attack in its early years and has been a top performer as a doomsday vehicle. However, over the past 5-6 years, its ecological projects have been few, and the willingness of developers to join is far less than that of ETH. As we compared earlier, all factors are already reflected in the price.

Moreover, the premise of a doomsday vehicle is "only to board during doomsday"; otherwise, holding it early until doomsday will also result in heavy losses.

Only 3 DEXs for Ethereum "Classic"

The example of ETC tells us that in certain time windows, it may be a good investment target; however, considering the long term and larger cycles, the strengthening of applications, ecology, and consensus is the key to the success or failure of a public chain. From this perspective, the branch ETC currently cannot compete with the mainstream ETH, and this logic of success or failure can also extend to EVM-like chains and other new public chains.

Therefore, Ethereum, as a "world computer" with relatively broad consensus, has too many applications, values, and interests tied to one chain—this also includes the interests of forks.

The butt decides the brain; hard fork is a technical term, in plain language: some people hope ETH maintains the PoW consensus mechanism. I don’t want you to switch to PoS, so I’ll fork a chain; you do your thing, and I’ll do mine.

From a profit perspective, the biggest victims of the Merge to PoS are probably the miners. If PoW is no longer needed, how will the costs of mining machines, venues, personnel, etc., be calculated? It may not be appropriate to withdraw investments at will. Reflecting on the Bitcoin fork five years ago, the surface reason was to scale Bitcoin, but thinking deeper, scaling is beneficial to miners to some extent (as they can package more transactions in one block and collect more fees).

The shift in consensus mechanisms in a technical context can cause fluctuations for certain groups in real life. Therefore, forks can be understood and participated in (waiting for snapshot airdrops), but can they succeed?

USDC/USDT will not turn a token worth 1 dollar into 2 dollars; Uniswap and others need to make choices between the original chain and the forked chain due to application ecology. We cannot precisely predict how projects will choose, but ETC has clearly not been chosen, and Vitalik Buterin will obviously not abandon the main chain to support the forked chain. After multiple rounds of development → application → optimization → consensus, ETH is clearly also an excellent choice for alignment. The choices of leading projects in various tracks on ETH will become the key to the forked coin battle.

The forked ETH (PoW type) may gain a foothold through the collaboration of local communities, miners, and KOLs; it will have a price, a voice, and actions, but does it have a future?

Creating a world-class decentralized computing machine and maintaining existing interests as a tool—the comparative pattern has already determined the direction. Of course, the interests game in the fork, opportunistic all-in, and leading selling can all be participated in, but caution is still needed.

In the practice of decentralized governance in cycles, may goodwill endure.

Five years of cycles, forks continue.

When stepping out of the debate about which chain is better after the fork and which coin price is higher, one can clearly see the large-scale organizations' shift in governance methods.

We often talk about decentralized governance in some projects; in fact, the act of forking is the best practice of decentralized governance.

On the point of "I disagree with you, I want to do something else," things have never been so simple: agree on a block height, find people with similar interests, and start a new chain to keep going. You cannot stop me in this process, and since public chain programs are open-source and accessible to everyone, forking is technically relatively easy to achieve.

Doesn’t this echo the legal saying, "I disagree with you, but I defend your right to speak"? Forking a chain out, free from the control of a certain center, and not being deprived of the right to fork—that is the profound impact brought by BTC/ETH.

It’s just a bit regrettable that in this cycle of multiple forks, the resulting branches mostly cannot compete with the mainstream, and their motivations appear more shortsighted and profit-driven.

Before being executed during the French Revolution in the 18th century, Madame Roland cried out: "Liberty! Liberty! How many crimes are committed in your name!"

May we, while breathing the air of technological freedom, not become the means and fuel for a few to reach their path to freedom.

May goodwill endure.