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As you all know that there's going to be another Bitcoin Fork and this time it's going to be a hard fork. So back in August segwit did end up activating and that raised the block size limit up to two to four megabytes. Segwit2x which is the fork I'm writing about today doubles the block size to eight megabytes in size or two megabytes if you are not thinking about segwit blocks.

Now it's important to highlight that back in August there was actually another hard fork called Bitcoin cash, which is still doing its own thing right now but they had something called replay protection built into the protocol. This means Bitcoin cash has kind of just become an old coin and you still have the original Bitcoin and Bitcoin cash going their own ways. Those who don't remember Bitcoin cash didn't want to get on the segwit train so they didn't enable that feature.

But back to Segwit2x, this was always part of something called the New York agreement which was signed back in May of this year and it actually agreed on enabling segwit at some point in the future. This was kind of fired up by the UASF or the User activated soft fork back in August but the New York agreement stipulates that within six months of segwit activating the block size would also be doubled. This New York agreement was signed by big 58 Bitcoin companies that actually covered more than 80% of the hashing power in the Bitcoin network. So, now with segwit activated on the network, we are now coming up to that 2x part and it's currently scheduled for sometime in November. They have stipulated a block that it's going to activate on and if you do the calculation this comes out at around November 18th.

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The chief argument for Segwit2x is just scaling Bitcoin. If you have bigger blocks there's less competition when you are inserting a transaction to try and get it included in the next block. This means that not only did the transaction fees go down because there's less competition but there's also a greater throughput for the network because overall more transactions can be just processed in each block. In theory, this makes Bitcoin cheaper and faster to use for everybody. The businesses supporting this proposal argue that having a faster and cheaper network will help with mainstream adoption and get more people using Bitcoin on a day to day basis.

Counter-arguments

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The counter-argument to this is that big blocks just take up too much space, too much processing power on the network and that most of this can be solved once segwit gains adoption. Segwit does help enable layer two solutions like the Lightning network but these things are still in development, we haven't seen them hit the mainstream yet at all. So, even with segwit enabled currently we are not seeing a huge improvement in the transaction fees or the speed of the network.

For the 2x fork some also argue that miners being able to change the protocol like this is a form of centralization and I guess it is to some degree but I think you also have to respect that the miners of Bitcoin are the ones securing the network. Without the hashing power, it does have Bitcoin wouldn't be what it is today and the network wouldn't be anywhere as secure as it is right now. So, the miners do kind of operate is a bit of a cartel centralized, I think they do deserve some respect.

Bitcoin Core team perspective

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The way the fork will go down is that these miners will be running a piece of software called BTC one. This is the fork of the Bitcoin source code which implements new rules and ups the block size limit by 2x. What's interesting is these code changes aren't being done by and aren't supported by the Bitcoin core team. Bitcoin core team have actually been quite vocal against the segwit2x fork. Bitcoin core team is so quick to label the segwit2x supporters as attacking the Bitcoin network. It's really hard to take a side because I can understand both sides of the argument. I think ultimately they are all just trying to fight for the future of Bitcoin.

How to protect yourself around a hard fork?

Make sure you are holding your private keys. If you have your Bitcoin currently on an exchange where you don't have access to your private key that's a big no-no because you want to be in control of those so you can redeem your coins for whichever fork you want to choose. On or around November 18th when the fork occurs just don't move your Bitcoin.

Ending Note

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There's a lot of politics getting involved and a lot of different tactics. With all these politics surrounding hard fork, it is going to be interesting to see which of the original 58 companies that signed the New York agreement continue to support it or whether we see some dropping out. There hasn't been an updated list of people who support the proposal or those who have dropped out. So it's kind of hard to tell what's going to go down in November. Coinbase and Bitfinex have announced though they will support both chains and they will try to give users the access to their tokens on both sides of the split.

From my perspective, the segwit2x fork not having replay protection is really them just saying we are the Bitcoin. Enabling replay protection kind of says you know what we are happy being an altcoin and just existing as a split off fork of Bitcoin. But in this case, both sides the Bitcoin core team who are currently the incumbents and the segwit2x both believe they should be 'Bitcoin'.

If you think activation of segwit was overblown and didn't really result in anything then this is the hard fork you have kind of been watining for. Something is going to go down in November that's going to be very interesting to watch

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References and Further Reads: 1, 2 & 3