Ethereum: Why Adding Further Divisibility to Bitcoin Would Require a Hard Fork

As the world’s largest cryptocurrency by market cap, Bitcoin has long been touted as a secure and decentralized digital currency. However, one of its limitations has been its lack of divisibility beyond 1 BTC. In fact, adding further divisibility to Bitcoin would require a hard fork, a major change that requires consensus among all nodes on the network.

The Problem of Instant Divisibility

Currently, Bitcoin’s block size and transaction limit are designed to accommodate a limited supply of coins. While this has enabled rapid growth and adoption, it also creates limitations in terms of scalability and usability. As more people and businesses want to use Bitcoin as a form of payment or store of value, the network is becoming increasingly congested.

One of the main problems with instant divisibility is that it limits the number of transactions that can be made within a given time frame. This means that if a large number of users try to send Bitcoin to each other at the same time, the network will become overloaded and slow down or even experience a “blockchain freeze.” Furthermore, this limit also creates an incentive for miners to focus on solving complex mathematical problems rather than verifying transactions, which can lead to increased energy consumption and environmental impact.

Adding Divisibility Beyond 1 BTC

To address these limitations, Ethereum has been exploring various proposals to add divisibility beyond 1 BTC. For example, Ethereum Network Improvement Proposal (EIP) 1555 proposes a new block size limit of 2^1024, which would allow for more frequent transactions and improved scalability.

However, one of the primary reasons why a hard fork is needed is that Bitcoin’s current consensus algorithm is not designed to accommodate divisibility beyond 1 BTC. The Proof of Work (PoW) consensus algorithm used by Bitcoin relies on complex mathematical problems to secure the network, but it also requires miners to solve these problems within a relatively small block size.

Why a Hard Fork is Needed

A hard fork would require a complete overhaul of the underlying protocol and architecture of Ethereum and Bitcoin. This includes updating the proof-of-work consensus algorithm, modifying the mining process, and redefining the network architecture.

Simply put, if we want to add divisibility to Bitcoin beyond 1 BTC, we need to fundamentally change its design. This requires a significant amount of work and resources, which would be difficult to achieve with the existing infrastructure.

Advantages of hard fork

Although adding divisibility above 1 BTC is necessary to improve scalability and usability, it is worth noting that the benefits outweigh the costs. A hard fork would require:

• Changes to Ethereum Network Improvement Proposal (EIP) 1555

• Updates to the proof-of-work consensus algorithm

• Change the mining process

• Redefining the network architecture

These changes could potentially lead to increased security, scalability and usability for all users.

Conclusion

In conclusion, adding further divisibility to Bitcoin would indeed require a hard fork. While this may be an ambitious undertaking, it is important to consider the long-term implications of such a change. If executed correctly, a hard fork can unlock new opportunities for scalability, usability and security for Ethereum and Bitcoin.

However, if we want to make significant strides in these areas, we must be prepared to accept the challenges that come with implementing a major protocol revision. This includes working through the complexities of updating our infrastructure, modifying our consensus algorithm, and redefining our network architecture.