Hey there, Edward! Could you tell me a little bit about yourself and your background? Was the Bitcoin Gold your first sort of venture into the crypto world?
No, it wasn’t. I’m a little older than an average person in crypto. I got my computer science degree back in the early 90s. I was following the news about Bitcoin during its first peak over $1k value, before the Mt. Gox era. I wasn’t actively involved, though — no mining or investing — I was too busy working as an IT director in a small investment bank in New York. I was pretty interested, though — it fascinated me, I was even strongly considering firing up a Ripple gateway. Less than a year later, during the coin market collapse, I thought, “Hey, I was brilliant not to get involved!”, but that’s just hindsight, you know. Years later I started watching the industry evolve, more and more projects appeared, all of them with philosophies different from Bitcoin — some interesting, some of them less interesting; Ethereum got to be really interesting, because it brought back GPU mining. One of the things that got me when I was first looking into Bitcoin was the fact that, although I could take a bunch of my servers and start mining Bitcoin on them, because we didn’t pay for power — we had a contract with a data center who did — the earnings would be really small, because ASICs were already beginning to take over, and I had no interest in sending several thousand dollars overseas to a company that might not send me anything for months, hoping I could make it back. With the rise of other algorithms — CPU-mined and GPU-mined coins — those piqued my interest. In early 2017, when Ethereum was mined heavily and was beginning to rise, and Bitcoin was beginning to rise I started investing. I started getting into Bitcoin around the 6–7 hundred dollar mark in January 2017, I also started doing some mining, acquiring more GPUs, doing mining rigs, overall becoming a more aggressive GPU miner, as far as home skills go — I never set up a data center and became a large-scale miner. That’s what led my interest to Bitcoin Gold specifically. In the summer of 2017 there was a sort of split in Bitcoin happening between the people who were more interested in big blocks and people who were more interested in SegWit and bringing about new things like Lightning Network; and from there emerged the idea to set up a variant of Bitcoin with a completely different type of mining, and what I found fascinating about that was that the rift between big blockers and SegWit people was largely following the rift between miners, developers, and users. This separation is a part of what is driving the wedge in the community — the miners had a different mindset about certain things than the pool of users, and you could see that rift forming. And at the time Bitcoin Gold came out, the key aim of launching it was to set up a coin with the same history of Bitcoin, but which would be mined on GPUs. And for me, there was double “Aha!” moment.
One: if the community forms around that, then the same people would be involved in using the coin as in mining the coin.
Two: I like the idea of the decentralization of that. I like the idea that you don’t have to spend thousands of dollars to buy ASICs in order to start mining, instead — just use the GPU.
And thirdly, I had just invested in a bunch of GPUs, so I was like, “Great! Another coin I can mine!” And I followed the project — followed the forums, did some software prep to be able to turn things on. During these early stages it came out that the team needed some help. They were looking for native English speakers who would help improving the language and some of the administration behind the scenes. I responded, we started working together, and a couple of months later they promoted me to a communications director, I became a core member of the team, and I’ve been on board of the organisation since January 2018.
And as far as I can gather, Martin Kuvandzhiev was the co-founder?
Yes, one of the 6 co-founders.
Would you mind telling me a couple words about the people who are responsible for Bitcoin Gold’s existence?
As far as I know, it was conceived in spring of 2017, and it really came to fruition around the middle of summer of 2017, around the same time as the Bitcoin Cash / Bitcoin rift was happening. Jack Liao, who is also the CEO of Lightningasic, was witnessing among his peers and among those working in the mining industry that rift that was going on, and he felt, as did some others, that a part of the problem was the separation between miners, the users, and developers. He was interested in a GPU-mined version of Bitcoin to bring the mining ability back to those users and developers as a form of decentralization. At that time, 80 or 90% or Bitcoin mining was happening in China in large warehouses of ASICs. That kind of centralization is bad for network safety, but also this kind of mining means that those people from one part of the world get control over mining, the hash rate and a lot of the funds, so Bitcoin Gold was proposed as an alternative — showing that a hard fork of Bitcoin isn’t something that was going to kill Bitcoin. That was a very big issue back then — people were very concerned about any hard fork of Bitcoin — that either the old coin or the new coin has to die. That (Decentralization) was the very genesis of Bitcoin Gold, and, in fact, you can see the concept of it in our GitHub name — it’s still the original code name, which is BTCGPU — kinda says it right there, having Bitcoin mined on a GPU. So, Jack recruited a couple of people to make it happen. They included H4X, who is our lead developer, and Robert, who was also a long time Bitcoiner, who was involved in the social space and knew some influencers. Robert was working hard on connecting with people in social space, looking for the people to join the project. H4X was and is our lead developer, he’s a very talented engineer; he’s a young guy, but he’s been doing really good work, and he has a deep understanding of crypto and the crypto space. H4X and Jack are both based in China, and Robert is based here in the US. And they also recruited Franco, he is a designer based in Colombia who has been involved in the crypto space — he is responsible for all the improvements you saw in the Bitcoin Gold website after the first version, and Martin Kuvandzhiev, who is also a young developer/engineer, who was also doing interesting things, he’s the CEO of a development firm — he’s gone to NASA competitions in the US, has had some really nice prizes. Martin was involved in the first implementation of the code that we did, he was also heavily involved with porting the pool software so that pools could stand up to mine Bitcoin Gold. Since then, he’s stepped away from development and became more involved with the business development side of things. And the 6th original co-founder — Alejandro, based in Spain. He helped crucially on the social engagement front and administration. They were the original members of the board until they added me to the board. In November of 2018, on the 1st year anniversary, Jack left the team to pursue other projects, and it didn’t make any functional impact because he was not involved into day-to-day administration. In the initial months he did a lot on the promotion side of things like initial business connections, press tours, early exchange agreements, but no day-to-day administration. The second thing that happened then [November of 2018] is that H4X stopped being anonymous. He was anonymous because he was based in China, and back then China was banning crypto mining firms and crypto exchanges — things were unclear. He also was a Google engineer, and the question was how his work for us could be seen by his employer. Since then, he left his full-time job at Google in favor of working full-time in crypto. He is still our lead developer and is responsible for overseeing all the development work.
I’ve never thought about the reasons people in crypto stayed anonymous before. I talked with a guy from Komodo, and as you may know their founder has always been completely anonymous.
A lot of it depends on personal circumstances — H4 was a Chinese resident and an employee of a major corporation. Sometimes is has to do with security concerns. Komodo’s model is different. They are more centralized, and their lead developer and founder may have some info that would be only safe to have anonymously. We are completely open and have our code on GitHub. We don’t have any special codes that need to be preserved and we do not have a master node, no zk-SNARKs, or anything like that. We don’t hold any customer assets, no special keys that could be used to undermine the integrity of the project — in fact, the only funds we hold are the Bitcoin Gold Endowment, the 100,000 coins that were mined at launch — in fact, you can see what we have on the website. We have nothing to hide, we have nothing to secure.
It makes a lot of sense. As far as I understood, your entire concept is Bitcoin for everyone, by everyone — your motto basically is “For everyone, for everything” — is it because anyone can download the app and mine Bitcoin Gold with it?
Yes, but with a small technical note. It requires a lot of video RAM. There are lots of laptops that can’t run it. That may change in the future as needs be. But now there are limits. Anyone who works with video or who is a gamer probably has a card suitable for mining Bitcoin Gold — and if you do want to get involved, you can go out and buy a card, relatively inexpensively at a consumer retail store.
Are we talking about, say, Nvidia GTX-something-something? Gamer videocards?
The first miners that I was building were based on GTX 1060s, and I think I was also running ATI 470s. Also had some GTX 1070s, so, not the cream of the crop, as you can see. It’s not really profitable right now, and a lot depends on how much you are paying for power. Now, if you are mining just to support the chain, it doesn’t require much power — you could also be accumulating coins at a low price for now in order to turn a nice profit for later, considering the ongoing cryptowinter.
So, about 51% attacks. We know that one of the main features of vanilla Bitcoin is that it’s really hard to 51% attack — I’ve heard that you need the amount of power needed to power the country of Denmark for a day or week to 51% attack Bitcoin. What about Bitcoin Gold?
So, it is good to remember there are two respects in which we say “51% attack”. First, using the cheater hash power that is equivalent to all the “honest” hash power. And as they have more than 51%, they can take over the chain, and they control the chain in perpetuity and collect all the rewards — that’s the most common way to think about it. Obviously, any smaller chain — which means any other — has less security in that respect than Bitcoin has. Anyone using the Nakamoto Consensus which we are, — proof-of-work chain — is going to be more vulnerable to it than Bitcoin. That doesn’t mean we are very vulnerable to it — there are certain economic disincentives at play. If you take over the chain to collect those rewards, the value of the coin will go down, the rewards are worth less, and this still requires huge investment in equipment and power. Plus, you will have other people fighting you the whole time to get control back. And since there are mining pools which have a vested interest in preserving the coins they have already mined, they are likely to bring people together to fight that.
The more important 51% attack concern to my mind is short-term Secret Mining attack. It is a short time takeover of the chain just to do a block reversion of multiple blocks in a row to achieve a double spend used to make a huge deposit, usually to an exchange, and buy some other coin with it. Double spends are only possible if you can spend less on the takeover than you earn from the theft from the exchange. For that, people usually rent power from a hash power market for a few minutes. They would use this power to mine their Secret blocks, where they mine a bunch of blocks they do not broadcast to the network, they do the big deposit, so they have half a million dollars, and as soon the exchange clears their deposit, because 10 or 20 blocks have passed, they trade it for Bitcoin, withdraw the Bitcoin, and release those blocks they have mined secretly. And releasing those blocks reverses the transaction and suddenly they have the original $500000 worth of BTG back and they already have the Bitcoin, the exchange hs been defrauded. That’s the attack. Our approach to combating that is a software-based one called cross-chain block notarization — a system for our pools and miners to notarize they’ve mined to other chains. And if we see a secret miner has released a bunch of blocks, the nodes won’t switch to that new chain even though it’s longer, unless those blocks also notarized on the other chains. If the secret blocks are notarized, they can be seen, and so it is clear that the attack is happening, and we stop this double spend.
So, you had to introduce notarization in order to combat double-spending attacks?
Yes, and the notarization goes not to our chain or to some sort of elevated BTG master node, but goes to a different blockchain and is not controlled by us. That keeps us decentralized — which is our main goal. The key the strength of this kind of notarization is that the chains that we’re notarizing to are built on different code, mined on different hardware, and are distinct networks from BTG’s. So if any strange activity is going on, all our nodes would still be able to see it even if our own network is split.
Are there any major differences in Bitcoin’s Gold code, aside from the mining algorithm, as compared to the one of Bitcoin?
Obviously the mining algorithm is a difference, which means we mine different blocks. Every Bitcoin block before October 2017 is also in our blockchain, and the mining changed for launch. We also have unique addresses — Bitcoin’s addresses usually start with 1 and 3, and we have A and G (G for gold, A for Aurum — Latin for gold), so people don’t get confused, there’s no user error. Also, we use fork ID to provide replay protection. Replay attacks go like this: if you use exactly the same algorithms and keys for signing and the same address addresses, once you make a BTG transaction, someone may take it and broadcast to the Bitcoin chain. So you’d your Bitcoin Gold to someone and discover that your coins in Bitcoin or Bitcoin Cash were taken by that person, who rebroadcast the transaction on the other chains — we are protected against that. We of course have changed the mining algorithm as we mine on GPUs, but we also have change the DAA — the difficulty adjustment algorithm. For Bitcoin we know that every 2 weeks it checks and lowers the difficulty if miners left and adjust the other way around. In Bitcoin Gold we preserved the 10-minute target for a block, but we also have an algorithm that changes the difficulty after every single block. It is done because GPU mining is very fluid. People may leave as the price lowers, it may slow down the chain and vice versa. Also, it is no good if we have new blocks coming not every 10 mins, but every 5 or 2, we don’t expect this inflation — so vice versa as well. Our original difficulty adjustment algorithm was based on DigiShield, and our current is LWMA, which performs better.
I would really like to talk about BTGPay. Could you please tell me what it actually is and how is it different from BitPay or any other crypto payment systems?
It’s confusing because suffix “-pay” is used really broadly. IPay, ApplePay, etc. For us, BTGPay is not a product we are producing, it is an ecosystem of 3rd party partners who use Bitcoin Gold as a payment system. We started it at the beginning of crypto winter, which was a terrible time to start this kind of endeavor. Back in those day we often heard “I’m a merchant, I want to accept BTG, but I need to convert it to other coins and need an automated invoicing system”. And we would hear from developers of merchant support services, “we have this great platform, but we don’t know how to reach the merchants.” The other side was the community saying, “I mine BTG, I don’t want to just dump it, where can I go shopping with it?” And we were in the middle, wishing these people could all talk to each other. This is the idea behind BTGPay. As much as possible, we want 3rd parties to build these sites, and we want to list all the organizations who work with BTG. We’re not trying to control things, we want to help the entire ecosystem in a decentralized way. That means partners like ChaneNOW.
You mentioned that BTGPay is on hold. I was going to ask you about Lightning Network and integrating it to BTG Pay. As I figured it out you are not planning to integrate it anytime soon, correct?
Incorrect. First of all, I would not say BTGPay is on “hold.” I’d say it’s on “slow.” We’ve been working with the team within an austerity program since summer of 2018 to make sure out endowment lasts long enough until the end of this crypto winter. We’ve done pretty good on that, starting with 100000 BTG-worth endowment and 1,5 years later we still have like 65000 in there. We do have a full functional implementation of LND from Lightning Labs, ported over to work with BTG, we’ve been able to do transactions with it on the testnet, but we haven’t started employing Lightning more broadly because we know it’s not just the matter of getting the code to work, it’s about having processes that can work with Lightning. It’s about easy-to use software that users can use to stand up nodes. We need to build an ecosystem to support the entire process — build the necessary pieces of infrastructure that would underlie all of that. There’s a library called btcd, which is a part of a btcsuite, and we do our version of that, which supports things like Neutrino wallet that would interact well with Lightning Network. You can’t build those things without prerequisites, that’s what we’ve been working on — prerequisites. Prerequisites for Neutrino, for example, include compact blocks, which existed in Bitcoin code in v17, but our initial work is based on v15, and it does not support compact blocks. Since then, we have enabled that.
The version the Lightning network that you are going to use in BTG is identical to what exists on top of Bitcoin, right?
Yes, we are building towards the same spec. Our goal is that anyone who is familiar with coding for Bitcoin or Lightning will also have the familiarity to do the same in Bitcoin Gold, as well as any coin that works with LN. The next step is cross chain atomic swaps, which have already been achieved by other projects on Lightning. We want to do that capability as well, because we want to become sort of a part of a big lightning network.
Are you as a project comfortable with necessary caveats that come with the usage of Lightning network? Everybody knows that Lightning network is in its early stages, it’s more comfortable for a lot of people to use vanilla Bitcoin for now. Are you going to make it more usable for everyone who wishes to?
You’re right, there’s a lot of difficulty in using Lightning right now. There are lots of developers working on making that better. For now, people find it much easier to work with BTC directly — we’d like them to work with BTG directly as well. We are extremely similar technolog, but transaction costs are profoundly smaller. We can be a good experimental platform giving the developers the tools they need and a live blockchain to work with with regards to implementing LN projects.
What about private transactions? You said BTG has nothing to hide, and everything is extremely visible, but I know for a fact that you have private transactions on the roadmap, so what protocol are you going to use to achieve privacy? Is it going to be like Monero, or ZCash?
There’s a lot to be decided before we can commit to a protocol. We are a young project, so we can change our code really easily. It’s both a blessing and a curse. We can make changes to implement new features, but we have to take the needs and wants of our community into account — but that includes merchants, miners, users, and even exchanges. Two major concerns for our partner exchanges: whether or not you are a security — we are not, we have a legal opinion to prove it — and also secrecy. Many major exchanges need to know the initiator of the transaction, and the secrecy of a coin can make it difficult. Banks keep all the transactions private, but we don’t want to have banks, we want to have a decentralized network. It is on our roadmap probably for the next year to start considering and talking to the community about the level and kind of privacy we want to have.
Are there any examples of exciting partnership cases that you’d like to tell us about?
What do you think about the situation with this crypto winter — do you think that what is happening now is a sign of change on the market or it’s just regular fluctuations?
I think that it’s a sign of real change in the markets. It’s been the longest crypto winter as we’ve mentioned. And it was a fall-off from a very big bubble. We have never had this many novice retail investors get burned before. When you burn yourself, you are going to be more careful next time. There’s a realization that there’s not great fear that markets are going to drop out entirely, almost nobody in crypto space believes the scaremongers of the news who say, “Hey, Bitcoin might drop to $1000, Bitcoin might drop to 0” — nobody believes that nonsense anymore. There’s a bottom, and it looks like we’ve reached it — nobody wants to be the sucker who sells when someone else is buying cheap. We reached the floor, we seem to be beginning to recover, and people have been doing great work in the meantime. People have done hard work on the underlying code, developing new ideas and techniques. Every project has stuff they’ve been working on. Many people have full-time jobs and they dedicate their personal free time to their project — all that work is still bearing fruit. It’s all coming into live projects now. And that’s very positive. It makes me very optimistic for the near future.
I know that BTG has a lot of plans for the future, I’ve seen your roadmap. Maybe you have some thoughts you’d like to share with our listeners and readers?
We’ve got the new core client, that’s about ready to go live. I’m running it on my machine and connected with another v17 node in Eastern Europe. I actually got exciting looking at the debug logs — my machine receives a header, I send this header to others, I receive the full block, I share this block as a compact block with the v17 node, then I start receiving the same header from other machines, and all this happens within a span of 1 second. We exchanged the info back and forth between Eastern Europe and Eastern United states, including a full compact block, before other nodes got around to sending me the block header. It’s fabulous what blockchain technology can do, these days.
Things we have: our version 17 core wallet is about ready to roll out. We are going to be working on releasing CCBN as quickly as we can, because we feel that security is critical to support the infrastructure. We also have side projects that we are hoping to put our time into to develop additional tools that will support things like Lightning Network. In fact, the v17 upgrade one of these things that will support Lightning Network. We’ve also got an expanded ambassador program: we had our first meetup in Africa, we had our first meetup in South America — in fact that was in Venezuela, just a few days ago. We’re also going to be doing plasma side chains. That’s something H4X is interested in; he wants to get our current work done so he can work a plasma.
Will we be able to see any immediate updates anytime soon?
The most immediate update is v17 core. And then the features that will cascade on top of it, regarding Lightning network. It’s going to be an exciting time for the BTG community.