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Four Key Disagreements Between Bitcoin Classic and Bitcoin Core

by: Kyle Torpey

Four Key Disagreements Between Bitcoin Classic and Bitcoin Core

Bitcoin Core contributor Peter Todd was recently interviewed on episode 34 ofThe Bitcoin Game, and the longtime Bitcoin developer and researcher was able to explain some of the key disagreements between how the Bitcoin Classic and Bitcoin Core teams view the peer-to-peer digital cash system.

While many view the Classic vs. Core controversy as nothing more than a technical debate, the reality is both camps seem to have rather different fundamental plans for the future of Bitcoin. During his recent interview, Todd noted:

“I think you’ve got a group of developers with a very different view of how Bitcoin works and what the goals of the projects are. I think that’s inevitably going to lead to a lot of friction.”

The current climate in the Bitcoin community is extremely contentious, and the differing philosophical views in the Classic and Core camps are at the root of all the controversy. When asked directly about the key differences between Bitcoin Core and Classic’s alternative implementation, Todd was able to provide four specific examples of where the two sides do not see eye-to-eye. 

1. Balancing Decentralization and Efficiency

For most, the crux of the Classic vs. Core debate is decentralization vs. efficiency. The Classic team is more willing to increase the system resource requirements for operating a full node, while the Core team wants to keep the barriers to running a full node as low as possible.

During Todd’s interview, he often used Bitcoin Classic Developer Gavin Andresenas an example of someone who opposes Core’s main viewpoints. Todd stated:

“[Gavin] expects people to go make that tradeoff where, in exchange for having a system that’s cheaper, you have a system that’s more centralized.”

Todd also pointed out that Andresen has claimed early adopters may be upset with what Bitcoin eventually becomes.

It should be noted that many on the Classic side of the debate would say that their view on how Bitcoin should work would actually be better for decentralization over the long term, but this gets into the next area of contention between the two sides.

2. Keeping Bitcoin’s Base Layer Decentralized

Todd’s first two points are closely connected. Todd all but admits that the real debate is more about how decentralization is achieved rather than which side is necessarily in favor of more decentralization.

The longtime Bitcoin researcher explained Bitcoin Core’s side of the argument:

“I think the real difference is that the Bitcoin Core developers--they understand that these tradeoffs are going to happen, at least with current technology--are willing to put the tradeoffs in different places. I would much rather have the tradeoff be that the Bitcoin blockchain layer--the very lowest level--stays highly decentralized. It may get more expensive to use directly, but you counterbalance that by putting the inevitable centralization at a higher level.”

Other supporters of the Bitcoin Core ethos often say they would prefer to build a centralized layer on top of a decentralized base because you cannot build a decentralized layer on top of a centralized layer. In the past, Bitcoin Core Contributor Eric Lombrozo has explained the need for multiple protocol layers for Bitcoin.

While centralized layers for off-chain Bitcoin transactions already exist (think Circle, Coinbase or any Bitcoin exchange), Bitcoin Core hopes less-centralized systems, such as the Lightning Network, can eventually offer an acceptable tradeoff. Nodes on the Lightning Network are trusted more than Bitcoin miners, but they’re unable to steal funds from users. The system essentially extends the Bitcoin blockchain for fast micropayments through the use of smart contracts.

Former Bitcoin XT Developer Mike Hearn and OpenBazaar Developer Chris Pacia both have writtenblog posts about the Lightning Network with skeptical slants. One of the main criticisms from Classic supporters is that the hubs on the Lightning Network will become too centralized and easy targets for governments as a method to censor transactions.

Whether this will become an issue in the real world is an unknown, but Lightning Network developers are working on Tor-style onion routing features for the system. The developers behind this possible extension of the Bitcoin blockchain understand the importance of protecting privacy at all costs.

3. What Is Classic’s Long-Term Plan?

According to Todd, Bitcoin Classic needs to explain how it will scale the Bitcoin blockchain if it does not view the Lightning Network as a potential option.

He noted:

“I’m just not seeing acceptance from the Classic team that there are limits to the system, and we can’t scale up [via a block size limit increase] indefinitely, so what’s your long-term plan?”

After referencing a statement by Gavin Andresen that Bitcoin may need another hard fork roughly 12 months after Bitcoin Classic’s first potential hard fork, Todd added:

“I think Bitcoin Core has been more focused on enabling solutions that fit on top of the Bitcoin layer, so we don’t have to make that hard trade--a hard decision, yet again, in another 12 months.”

In other words, Bitcoin Core sees the need for something like the Lightning Network for Bitcoin to scale, and simple block size limit increases are not going to cut it over the long term. Bitcoin Core sees the Lightning Network (or some other off-chain protocol) as the best path forward because it does not believe the system can scale with too many transactions on the blockchain. A key side debate here between the two camps is whether the Bitcoin blockchain should be viewed as a settlement layer.

4. Accepting the Realities of Bitcoin Scalability

The vast majority of Bitcoin Core developers and contributors view Bitcoin as a settlement layer because they accept the fact that the system in its current form cannot scale to mainstream levels of adoption. Todd explained what he seemed to view as this harsh reality during the interview:

“The system doesn’t scale, and you just have to accept that and do something smarter. Every time you do a [block size limit] increase, you’re making the system more centralized.”

These two projects simply have two completely different viewpoints on how Bitcoin should work, which means it should be no surprise that the entire community is somewhat split at the moment.

Todd added:

“It’s not necessarily one’s right and one’s wrong, but [Gavin] is not interested in designing the same system I’m interested in designing.”

Thank you!