Bitcoin Cash network faces SBI attack threat, claims Bitmain chief

September 07, 2018
Chris Wheal

Japanese financial services giant Strategic Business Innovator Group, aka SBI, is a threat to the Bitcoin Cash (BCH) network and could mount an attack using its hashpower to hand over control to its ally, Craig Wright, the chief scientist at nChain, suggests Bitmain’s chief.

Jihan Wu (above), the founder and chief executive of the Chinese mining company, took to Twitter to express his concerns. The tweet read:“SBI threaten to attack BCH with their hashing power, to help CSW control BCH. They are bad people, and they will fail.”

Last December SBI BITS, subsidiary of the financial conglomerate SBI Holdings announced its strategic partnership with blockchain research and development pioneer nChain. The partners pledged to work together to develop stronger cryptocurrency security solutions for institutions and customers and said they planned to work together on other projects supporting the BCH network.

Avoiding another split

Bitmain’s CEO added his warnings to the Twitter post of website author David Jerry, which was titled ‘There can be NO SPLIT of BCH — Or the network dies!’. Jerry wrote about the history of Bitcoin Cash’s split from Bitcoin (BTC), the relevance of creating the BCH network and disadvantages of further splitting the network. He added that the reason for the split matters more than the forking mechanism itself.

Jerry suggested that business adoption of BCH won’t continue as envisaged if the ledger divides into two. Mentioning the hard fork from BTC, he wrote that the low rate of business adoption on BTC saved the businesses from facing irrecoverable damage from the split.

He added that businesses running on the BCH network would be dismayed by any split, which would break the permanence of the ledger they share. For instance, a business has multiple counterparts which prefer to use a public blockchain to meet their transaction requirements. Should a ledger they share split into two, the opinions of the counterparts could similarly divide, wih various negative consequences.

The blog post also discussed the hash war that was due to break in 2017, which could have avoided the split from BTC. However, conflict was averted when the BCH was created and gained its own ticker. Jerry concluded by stating that the longest chain is always most likely to win the battle, quoting the words of Satoshi Nakamoto in the Bitcoin whitepaper regarding the ‘longest chain wins’ rule.

A prolonged dispute

Jerry responded to Jihan Wu’s comment by writing:“No such claim was made. SBI will remain neutral and support the longest chain. If a split occurs then unfortunately BCH cannot be used as a platform for real businesses.”

Another Twitter user commented:“Jihan, if Coin&Chain (coingeek/nChain) get 51% hashrate on BCH, will you and the other chinese miners defend by moving hashrate from BTC to BCH? And how much hashrate can we expect to move over? Coin&Chain “claim” to have 2 exahash. The total in the system is about 50 and BCH 4.”

BC community developers have been in dispute over several months, which is likely to lead a hard fork expected to arrive in November. The two parties involved are the supporters of the nChain implementation and the Wormhole protocol.

Craig Wright and Antiguan online gambling entrepreneur Calvin Ayre are the proponents of the nChain implementation while Jihan Wu and longtime BTC investor Roger Ver opt for Wormhole, which is being developed by the Bitmain developers.

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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