Schnorr signatures, Taproot, and Sighash Noinput are three of the most well known Bitcoin improvements that appear to be on their way into the protocol, but Zucco asked the panel if it’s possible there could be some hiccups in terms of the activation process for these changes.
Although many Bitcoin developers perceived Segregated Witness (SegWit) as an uncontroversial change, the activation of that Bitcoin improvement took much longer than expected after the process became politicized.
This topic of the politicization of SegWit’s activation process was discussed during a panel on day one of Understanding Bitcoin, and Zucco summarized that conversation.
“Yesterday, we discussed the history of SegWit,” said Zucco. “SegWit was not a technically controversial improvement. All of the technical people were ACKing SegWit. They were okay with SegWit. But then, they used a mechanism to signal readiness by miners, and miners started to leverage that mechanism in order to vote instead of signal. That created a political drama that lasted for awhile.”
During this drama, Bitcoin Core contributor Eric Lombrozo pointed out that SegWit’s activation method, known as BIP 9, was mostly developed as a courtesy for miners. Lombrozo added that it was unlikely this activation method would be used again in the future.
BIP 8? BIP 9? Flag Date?
Back responded to Zucco’s question around the potential issues that could arise during the activation process for Bitcoin’s upcoming changes by pointing out that there is an alternative to BIP 9 in the form of BIP 8.
“There’s just one small difference [between BIP 8 and BIP 9), which is there’s a period for the activation level to reach its threshold, and with BIP 8, if it doesn’t reach its threshold, it activates anyway at a fixed date,” explained Back.
Back expanded on the topic, adding that BIP 8 effectively gives miners time to get ready and signal their readiness to the network without giving them any input as to whether or not the change will eventually go live once the activation process has started.
Back indicated that there may also be other activation methods available, and he pointed out that the P2SH soft fork was activated with a simple flag day method, which is now commonly referred to as a user activated soft fork (UASF).
Back added that the flag date activation method is not as flexible as other options and may have risks if there’s a situation where the network decides they wish to back out of the upgrade.
“[BIP 8] is great because it allows you to go as fast as you can if everyone is on board and activating,” said Nahum. “Otherwise, it will take longer, but it will happen anyway.”
At this point, Zucco brought up the UASF that ended up being an unplanned part of SegWit’s activation process and asked if that could be of use here.
“I don’t know if it’s going to be like that or not,” said Nahum. “You know, I thought SegWit was uncontroversial, but that ultimately took a bit. I don’t think Schnorr and Taproot are controversial, but we’ll see.”
The Privacy Aspect
Nahum also brought up the fact that there’s a privacy component to improvements like Schnorr and Taproot, and in his view, some people aren’t going to like that.
“I’m afraid there’s going to be some pushback from people that are not [pro-privacy],” said Nahum.
Back added that the privacy side of these new upgrades will make them interesting to watch in terms of who supports them and who doesn’t. In his view, there were reasonable tradeoffs that could be debated in the block size limit controversy, but privacy is another matter.
“With privacy, when there have been discussions with [the] user community . . . almost everybody was in favor of privacy on the user side,” said Back. “And exchanges are just providing service to users, so if they say, ‘we don’t take transactions that are private,’ users will just switch service providers ultimately. So, it’s very unpopular for people to say that they don’t like privacy. It would be interesting to push them to see if they are willing do that.”
Nahum added that Bitcoin without censorship resistance, which is enhanced with better privacy, is not very useful. In his view, Bitcoin without censorship resistance is basically just a worse, less-efficient version of PayPal.
The Climate is Less Political Today
From Decker’s perspective, the Bitcoin community is not in as much of a political climate as it was during the SegWit activation process.
“Most of the people that were shouting and screaming have gone to do their own thing. I don’t see that same level of discussion and toxicity in the community like we did with SegWit,” said Decker.
“It’s quite the contrary, right?” Decker continued. “SegWit bought us the ability to create some really nice and deep changes without having to hard fork anymore. And so, we now can engineer these really clean and precise and minimal changes to the Bitcoin protocol in a very targeted way without having to carry a lot of the baggage from previous generations of the protocol. I think this is uncontroversial — unlike maybe SegWit. I hear far less opposition to this bundle of upgrades, and I’m pretty hopeful that we can get this done quite quickly.”
In Decker’s view, any of the activation methods that have been proposed (BIP 8, BIP 9, or a UASF) would work for this potential bundle of improvements.