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How does Bitcoin Cash governance / updates work?

Bitcoin Cash is decentralised, meaning it is a system with no one in charge or able to force action from anyone else. If this is unintuitive, consider it like the Internet itself - no one is "in charge" of the Internet, no one "owns" the Internet & no web page is the "center" of the Internet. There is no "official Internet office building" or customer support line. The Internet is an open system maintained by a wide variety of loosely coordinated amateur & professional individuals & groups in an organic (and sometimes messy) way. BCH is the exact same.

Many cryptocurrencies claim to be "decentralised" (like BCH or the Internet), but the reality is often very different. Power is frequently concentrated on any/all of an "official" foundation, organising body, founder, developer team, media promulgation channel, insider group or other central or network-critical entity of some kind.

Bitcoin Cash has no such thing. BCH was founded by Satoshi Nakamoto, who remained entirely anonymous, vanished in 2011 & never profited by selling his coins. The project has:

  • No official or "recognised" spokesperson or figurehead
  • No "central" website
  • No verified Twitter account
  • No foundation or controlling body
  • No venture capital investors
  • No official code repository, official/core development team or "endorsed" node implementation. Note that Bitcoin Cash is the only cryptocurrency in existence where an influential development team has been forcibly ejected from the project into a minority chain split by organic dispute from the community at large.
  • No roadmap
  • No central/official anything

Any coin with any of these aspects is to some degree centralised.

The entire Bitcoin Cash ecosystem (miners, developers, community organisations, businesses and end users) operates entirely according to its own volition with no hierarchy or "official" designation of any kind. For example: as with everything else in the ecosystem, The Bitcoin Cash Podcast itself is simply a community run initiative which has no authority beyond the choice of Bitcoin Cash adopters to listen. Anyone is free to create a competing podcast or information hub (even with literally the same name if they wanted, although that probably isn't an advisable marketing strategy).

Most critically, BCH currently has six active, independent full node protocol developer teams:

Therefore, BCH has quite a different governance model and update process than other cryptocurrencies, which has developed out of BCH's unique history.

CHIP Process summary​

How to agree on upgrades in a decentralised system where no-one is in charge?

  • Someone (the CHIP owner, e.g. Jimmy) says "I would like to change X".
  • Jimmy is responsible for publically publishing ideas about Change X as a CHIP to the BCH community.
  • The BCH community discuss, debate & give feedback.
  • Jimmy iterates & improves on Change X until lots of people start to agree. This process can often take multiple years for larger changes - so Jimmy has to be pretty serious about it!
  • Once traction is well underway, Jimmy creates a big list of lots of influential people in the community saying "Change X is a good idea, I support this!" as part of the Change X CHIP document.
  • Once it's obvious basically everyone supports Thing X and there is not really any group of people seriously involved in BCH making a huge drama to dispute it, then the CHIP is considered "locked in", If that happens before November of a given year, then the node developers have until May of the next year to code it up. If it doesn't happen before November, then it is postponed until the following year.
  • Upgrade goes live on May 15.

CHIP Process in detail​

Anyone can propose and lead an upgrade to the network (including proposing a change to the way network changes are proposed or upgrades are accepted!). Currently, network upgrades happen on a yearly schedule in May. Making an update to the network requires building voluntary social consensus of stakeholders through the CHIP (Cash Improvement Proposal) framework. This framework is designed to be:

  • Orderly
  • Transparent
  • Seen well ahead of time
  • Widely consulted, needs buy in from a strong amount of affected stakeholders

This process is slow and energy intensive, but that is by design to ensure only very good ideas with very strong, well meaning champions of the upgrade become widely accepted and implemented.

Note that achieving "consensus" is a rough measure of support by the vast majority of engaged participants. It does not require unanimous and universal acclaim by BCH holders, developers, businesses etc. There is no comprehensive list of all those parties to begin with. Even if there was such a list, achieving 100% agreement is impossible in any large group. Instead, a general acceptance by the network is sufficient. This acceptance is visible via proactive messages of support from relevant people (gathered by the CHIP author) plus a lack of community uproar or controversy.

To have more influence and weight in protocol level discussions, it is beholden on individuals themselves to make noteworthy contributions to the ecosystem and connect to other heavily engaged participants, which can be thought of as "social Proof of Work". Any objections or complaints are also beholden on the individual to raise with specific CHIP authors or to bring to the community at large via public discussion channels. Compelling and well-reasoned objections will build momentum and support from others and create enough doubt to intervene in a CHIP rollout, but objections which are either too weak or too weakly argued to gain credence outside of their progenitor or close circle will be bypassed in favour of forward network progress.

See this video by Satoshi's Angels (another community run organisation) for more information:

For a list of current CHIPs see bch.info/chips. Many proposals for CHIPs start with discussion on Bitcoin Cash Research, although it's also possible to start by contacting relevant stakeholders.

For another explanation of the CHIP process, see this blog post by Jason Dreyzehner.

How is it different to the BIP process?​

Bitcoin BTC uses the "Bitcoin Improvement Proposal" or BIP system. Conceptually, the BIPs & CHIPs are similar in that they can both propose technical, protocol updates to the relevant currency. In practice however the two processes manifest quite differently. CHIPs require wide ecosystem consultation and buy-in, over a defined period of time, among as many major ecosystem players as possible. The responsibility for this contact and upkeep falls on the CHIP proposer themselves. In contrast, the BIP system in practice tends to revolve around insular discussion on the Bitcoin dev mailing list or BIP Github repo, with sporadic ACK/NACKs from passers by, no determined timeframe and often total invisibility to the outside BTC community. The deciding factor in an "upgrade" tends to be the influence of a couple of key players, and this exact phenomenon was what led to the BTC/BCH split in the first place.

CHIPs are also a little broader in application, they can be made for any ecosystem improvement or coordination need - does not have to strictly involve code changes at the node/protocol level.

2023 Upgrade livestream​

The latest network upgrade was May 15th 2023. Check out the community live stream of the upgrade activating!

2022 Upgrade livestream​

The 2022 network upgrade was May 15th 2022.

See also: The Bitcoin Cash Podcast's May 2023 CHIP Endorsement