Can UASF really break the deadlock in scaling? Will developers force miners to activate Segregated Witness?

An experimental idea aimed at pushing a controversial change to bitcoin’s code took another step forward this week.

Here’s the situation: With one scaling solution backed by Bitcoin Core — Segregated Witness (SegWit) — stuck in limbo (miners have so far been reluctant to signal support for SegWit), some have sought more drastic ways to push changes through the network.

An upgrade process called a User Activated Soft Fork (UASF) is expected to come.

UASF was originally posted to the Bitcoin technical mailing list a few weeks ago by an anonymous developer named “shaolinfry,” and the proposal outlines a new way to upgrade Bitcoin.

The new idea is complex, but the gist is that instead of miners deciding whether to make upgrade changes to the bitcoin network, the decision would be made by the bitcoin economy (including users, exchanges, wallets and payment processors).

The idea quickly sparked discussion on social media about its security. Although it is a new and controversial idea, it has gained the attention of many Bitcoin developers, including JoinMarket developer Chris Belcher and David Vorick, co-founder of the decentralized storage platform Sia.

Afterwards, shaolinfry took the opportunity to release a second proposal.

This proposal proposes a SegWit-specific UASF that meets current deployment requirements. This means that if this UASF is implemented, this new soft fork can be triggered as early as October.

Shaolinfry said:

“ In this case, if SegWit is not activated by October 1, miners will be asked to deactivate. If miners refuse, then exchanges will reject blocks from miners who do not signal support for SegWit, and miners will not receive block rewards. ”

Belcher noted that developers are now calling this scheme a “super UASF.”

Super UASF Proposal

If Bitcoin wants to add new features like SegWit, it needs a way to upgrade its rules, but such upgrades are complex for a $20 billion software and raise concerns about security, such as not splitting the blockchain in two.

A soft fork approach supported by miners is considered the safest way to upgrade as it is backwards compatible and does not require everyone to upgrade.

However, Shaolinfry sees UASF as a necessary option at present.

Shaolinfry said,

“There’s a very dangerous idea circulating in a lot of circles that miners can dictate the consensus rules.”

He also pointed out that the Bitcoin white paper limits the role of miners to arranging valid transactions into blocks.

On the other hand, Vorick sees SegWit as an optional upgrade, a solution that not everyone has to use but that can bring numerous benefits to the bitcoin ecosystem.

He said:

“UASF is becoming a popular idea these days because miners are rejecting something that appears to have a lot of community support.”

However, Vorick does not think UASFs need to be tried right away, and he said on the Bitcoin mailing list that a better implementation of a "super UASF" would first need to gain agreement from important Bitcoin economic entities.

When asked if it is too soon to launch a UASF, Shaolinfry said:

“I personally don’t think so, as this is not a new deployment. The BIP just needs to get exchange support, enough hashrate signaling or the option to mine profitably using SHA256 ASICS. It will be upgraded along the way.”

On the Bitcoin mailing list, Shaolinfry also stated that the vast majority of nodes have been upgraded to Bitcoin software using SegWit. Many companies have also upgraded their software to support this change. Some Lightning Network implementations that rely on SegWit have appeared, which largely proves that the Bitcoin ecosystem supports SegWit.

In addition, the developer also believes that UASF has been used to deploy other upgrades before without any problems.

Encountering doubts

However, many people do not think UASF is a good idea and have raised many questions in the discussion: How to judge the economic majority? Is UASF safe? What if miners firmly disagree?

Some people think UASF is too risky right now.

Phil Daian, a PhD student working on Cornell University's IC3 cryptocurrency project, called UASF "the worst of both worlds" in a blog post. Ironically, he worries that the solution puts too much trust in miners. Bitcoin Core developer Luke Dashjr shared his thoughts.

Daian said:

“If there’s a malicious block that gets mined, you can essentially fork the chain. If the majority of hashrate doesn’t execute the new fork, then this could become a permanent fork, and you’ve effectively used hashrate to hard fork. That hashrate wasn’t used to validate the soft fork rules. And then you own that hashrate.”

“You become very dependent on the miners’ honesty and integrity.”

Opponents argue that miners have no choice but to support the chain that the economic majority wants, at least if they want to continue selling the coins they mine.

Vorick said UASF needs more time.

“We need more research and consideration on UASF before we are sure. I think if SegWit fails, then we might try UASF.”

All in all, he’s optimistic, even if SegWit never gets activated.

“If Bitcoin never gets the SegWit upgrade, that would be a disappointment. But I don’t think the cryptocurrency’s ambitions would be thwarted.”

He concluded:

“Bitcoin has acquired a lot of properties that no other cryptocurrency has.”