Please note that I wrote this analysis on March 19th, 2018. I informed the developers and admin on the Monero Protocol about everything contained within this article. They refused to do anything about any of it despite my repeated warnings that an entity called ‘Monero Original’ would attempt a hostile takeover of their chain.
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Copy of the Press Release that the “Monero Original” Has Been Sending to All Publications All Over Crypto Since March 19th, 2018
Recently, the publication at bravenewcoin.com received this ambiguous e-mail from individuals claiming to be behind the idea of ‘Monero Original’. Below is a copy of the excerpt, posted verbatim
To whom it may concern,
We are contacting you on behalf of the developers team behind the Monero Original project. Monero Original (XMO) is the original Monero chain that we will keep up and running after the Monero hard fork scheduled for the 28th of March 2018 at block #1539500.
We are eager to spread the information about Monero Original to ensure that even more miners, exchanges and wallets can benefit from the upcoming hard fork, support the original chain and get XMO coins. By this email we invite you to share this information with the readers of [Media Name].
Please feel free to use the attached detailed information and kindly get back to us if you have any further questions regarding Monero Original.
Monero Original team
Monero Original team has announced support for the original Monero blockchain that will be kept and running after the Monero hard fork scheduled for the 28th of March 2018 at block #1539500.
Every user holding Monero on their XMR wallet that support Monero original will receive the equal number of XMO coins.
While the new cryptocurrencies created in the result of the hard fork will be using the brand new chain, Monero Original will continue staying on the original chain. This ensures the uninterrupted transaction processing without any delays within the original chain.
“Monero has always been about freedom of choice, about diversity and about the strong community behind it. We are providing the Monero fans a possibility to support the iconic coin and stay on the original chain. Monero Original team stands for diversity, which is a logical marker of evolution. We are excited to see our favourite coin mature, and we are even more excited to help keeping this diversity,” says the lead developer of Monero Original team.
Monero Original Development Team
When checking out the GitHub links — there does appear to be a forked repository that was created on March 2nd.
What’s the Back Story?
So, early in February, news came out regarding the potential use of ASIC mining by a company named Bitmain.
For those that are unfamiliar, Monero runs a consensus algorithm called ‘CryptoNight’.
The purpose of creating an ASIC-resistant consensus algorithm is to promote decentralization.
How Does it Do That?
If you’ve heard about Bitcoin mining, you’ve probably heard from several different sources that you need to set aside a substantial amount of money for an initial investment into mining equipment in order to be competitive enough with other miners to run a profitable mining operation. This is primarily because of the introduction of ASIC miners, which use an exploit in the code of blockchain technology in order to ‘shortcut’ the Proof-of-Work (PoW) process, which significantly raises the threshold for how much computational power can be thrusted on the network.
Why is This a Problem?
Because of the difficulty re-targeting algorithm on networks. In order to keep the block times consistent on a coin, the ‘difficulty’ of solving the Proof-of-Work equation increases as more miners and hashing power enter into the network. So, when ASICs enter onto a network, the total hashing power on the network raises exponentially, which has a proportional increase on the difficulty of the PoW. As a result, those that are mining with GPUs are unable to remain profitable. So, this forces the network to resort to ASICs to effectively mine.
This is an issue because ASIC miners cost a substantial amount of money. So, only those with a lot of upfront costs are able to mine on the network. This leads to massive centralization of the protocol itself, which in turn makes the network inherently less safe according to popular Bitcoin theory.
As outlined in a prior bravenewcoin article, Monero’s response to this apparent onboarding of ASIC miners onto their protocol was to schedule an emergency hard fork on March 28th, 2018. Here’s a screenshot of this press release below:
The Drama Intensifies
Recently, on March 17th, 2018, Bitmain officially announced that they were selling the Antminer X3, which is an ASIC miner specially designed to mine on coins that use the CryptoNight consensus algorithm.
As evident by the picture below, posted in the bravenewcoin article that originally covered this issue, it appears that ASIC miners came on the network well before the announcement of this mining equipment was made:
How This Ties into Monero Original
So, to recap, the Monero team is planning on initiating a consensus change on this planned hard fork, which is pretty major because this requires that the entire network upgrade if they wish to remain on the developer’s chain.
However, the press release that the bravenewcoin received from an entity that calls themselves the ‘Monero Original Team’ may be credible. For those that don’t have a working knowledge of how hard forks work, the entire protocol must upgrade in order for there to be an unavoidable chain split. Even if just one miner decided not to upgrade and one full node decided not to upgrade, there would be a chain split:
Theories About What May Be Going On
The “Monero Original” team could be a Bitmain-sponsored entity. This is probably the most plausible theory for a few reasons:
· Bitmain has a LOT at stake. If Monero is able to successfully complete this hard fork and the original chain which contained the CryptoNight algorithm that was ASIC-exploitable ‘disappears’, then Bitmain will be left with millions of dollars worth of useless equipment. Not only that, but whatever profits that they were making from the chain will be absolved as well. Given the fact that they have just released their Antminer X3 just 11 days before the hard fork itself, it stands to reason that they’re anticipating that these miners will be put to use in the near future. Otherwise, these efforts have zero basis in logic.
· It would be more than feasible for Bitmain to implement this solution. As the predominant manufacturer of ASIC-enabled chips and as one of the biggest mining conglomerates in the cryptocurrency realm, they have accumulated a substantial amount of resources. Estimates suggest that the company earned billions in profits last year. With this level of revenue, they have more than enough resources and equipment to account for way more than 1% of the hashing power on the network with their miners alone. One must also account for the fact that there is probably a percentage of individuals on the network that simply won’t upgrade at all due to laziness (how many times do you upgrade your computer immediately when it tells you to?). We’ve seen this phenomenon actually take place before during a planned hard fork for Bitcoin. When the entire network is on the same page, this isn’t an issue. However, when there is clear dissent within the community with regards to upgrading the protocol to the latest version, this chain split can be permanent and run parallel to the original chain.
This could all be one big prank by someone that simply wants to exploit some of the confusion that may be going on in the Monero community/protocol. Perhaps Bitmain will simply decide to take a loss on the project entirely and may be attempting to sell their remaining miners to those that are using CryptoNight protocols on other chains.
However, this seems fairly implausible as there’s nothing to gain from running any sort of prank and attempting to exploit a hard fork in the same way that the ‘MoneroV’ hard fork chain has attempted to do would more than likely be a futile mission.
Potential Danger for Monero
As stated above, Bitmain’s ASIC miners allow it to perform at a level that outstrips any GPU or CPU miners. Since the hard forked protocol that the Monero dev team is proposing will more than likely be unable to compete in terms of hashing power, the likely results is that they will be outworked by the ‘original’ chain if the ASIC miners remain on it and keep mining. And why wouldn’t they?
As shown in the graphic posted above about node and miner upgrades on a protocol when a hard fork is instituted, the propensity for a hard fork to be unsuccessful when there is substantial hashing power on the legacy chain is great.
For some reason, this risk doesn’t appear to have been factored in entirely or even accounted for in the Monero community and, in the author’s humble opinion, there appears to be a general apathy toward the real possibility and threat of a hostile takeover of the chain if this hard fork is not implemented in a careful manner.