On November 15th, 2020, a new chapter in the history of Bitcoin will begin. With the introduction of the new coinbase rule, the reference software implementation team for a Bitcoin network will be assured sustainable funding to accomplish the vision first articulated by Satoshi Nakamoto: the creation of a peer-to-peer electronic cash system at global scale. This funding, derived from a portion of new coins created in each newly discovered block, is not reliant upon the whims of venture capitalists, billionaire gambling moguls, or the continued goodwill donations of major miners and holders. Unlike other Bitcoin networks, which rely on these funding sources, the new coinbase rule allows Bitcoin ABC, and any reference implementation that should come in the future, to act with its incentives fully aligned with the security and stability of the network.
As this new Bitcoin network is adopted by even more users, its overall value will grow accordingly. The funding generated by the new coinbase rule will not only allow Bitcoin ABC to meet its mandate of providing the protocol-level software that fulfills the Bitcoin Cash roadmap, but will also provide an opportunity to fund projects throughout the ecosystem that grow the value of the network. We are committed to a framework for the use of these funds that will provide maximum transparency, accountability, and oversight. We believe that the best choices for which projects and initiatives receive this funding will come from broad agreement among the network’s stakeholders, reached after those stakeholders have engaged in thoughtful debate and analysis. It is with this principle in mind that we are announcing the formation of the Global Network Council to provide guidance and governance for the funding of the greater ecosystem.
Satoshi Nakamoto, with Bitcoin, delivered a system of governance based on powerful first principles: network security and stability through economic incentives, cryptographic proof, and Proof Of Work. In formulating the structure of the Global Network Council, we draw on these principles. In addition to the reference node development organization (currently Bitcoin ABC), there are two clear and co-equal groups of demonstrable stakeholders in a Bitcoin network. The first group is miners. The second is holders. The Global Network Council will, once per year, bring together miners (and mining pool operators), who have provided hashpower to the network in the preceding 12 months, and major holders, who have incurred opportunity cost by keeping their value on the network for an extended period. In both cases, it is Bitcoin’s hash and signature algorithms that allow the members of the council to prove that they are indeed significant stakeholders in the network. This is a remarkable advance for a governance system within a global financial network. We are excited and hopeful about beginning this grand experiment.
In January 2021, Bitcoin ABC will convene the first Global Network Council. There are several candidate locations, all of which will allow maximum freedom of access and movement during this period of global travel restrictions. The structure of the council and the schedule for the proceedings is being finalized. The location and acceptance process for qualified members will be made publicly available before the November 15th upgrade. While the proceedings will be closed to the general public, they will be streamed live online and we encourage all Bitcoin Cash network participants to convene in the city that is chosen to meet and celebrate this bright new future for Bitcoin Cash.