Bitcoin Cash has a new algorithm for adjusting complexity

The Bitcoin ABC development team has announced its plans to update Bitcoin Cash through a hardfork planned for November 13th. The update is designed to stabilize the complexity algorithm (DAA). Leading developer Bitcoin ABC Amory Sechet (Amaury Séchet) and CEO Bitprim Juan Garavaglia told what to expect from the upcoming update. On Monday, the Bitcoin ABC development team issued a statement regarding the upcoming hardfork of the Bitcoin Cash network (BCC).

The purpose of the update is to solve the problem with the algorithm for changing the complexity of the crypto currency, which periodically leads to a significant decrease or vice versa, an increase in the block creation time in the Bitcoin Cash network:
"The activation of new consensus rules will occur at the average time mark in the block, which will appear after the mark of 1510600000. This corresponds to November 13, 14:06 GMT."
The report also notes that the new version of the software, containing the updated DAA, will be published on November 1.
Leading developer Bitcoin ABC Amory Sechet, said that "nodes need to be updated. Some purses need to be updated, others - no. It all depends on the technology underlying the wallet. " He believes that the update "is unlikely to lead to ramifications at this time." However, Sechet invited users to double-check their transactions in the browser, for example blockdozer.com or blockchair.com, if they have doubts. "
How smoothly the hardcore passes will depend on the Bitcoin Cash community, especially on sites and wallets that need to be updated by November 13. The developers of the project noted that they "communicated with the Bitcoin Cash miners, they are ready for renewal and are waiting for it."

Challenges for the new DAA

In a statement made on Monday, five criteria for the new DAA algorithm are described. It should (1) "adjust the complexity of the hashtate to set the average block interval to 600 seconds"; (2) "Avoid sudden changes in complexity when the hashtrate is sufficiently stable"; (3) "Quickly adjust the complexity when the hashtate quickly changes"; (4) "Avoid fluctuations from feedback between hashtreit and complexity"; and (5) "be resistant to attacks, such as manipulating the time stamp".
These criteria relate to problems with the original DAA crypto currency, called "Emergency Management of Complexity" (EDA). The statement explains:
"The original" EDA "Bitcoin Cash allowed the network to survive, being the smallest chain, but provoked serious hesitations. This is problematic, as it hinders the consistent rapid confirmation for users, and radically shifts the release schedule of coins. "
Three algorithms were tested that met the criteria from the developers in the Bitcoin Cash community. It was a D578 from Neil Booth (Neil Booth); D601 from Amory Sechet; and D622 from Tom Harding.
Two development teams in the Bitcoin Cash environment that did not submit proposals, Bitprim and Nchain, evaluated the three proposed algorithms. After several weeks of testing, the DAA Secetta was chosen to replace the EDA.
Sechet said that the Harding algorithm D622 also performed well during testing. According to Sechet, he performed "a little better overall, but also more difficult for analysis in terms of security. As a result, he has been rejected so far. " He also believes that the D622 algorithm could be improved and replaced by its own in the future. At the same time, Sechet notes that "now we should not delay the solution of a problem that has already been present on the network for too long."
According to the developers, the Nchain team came to the conclusion that Sechets DAA is a "logical choice", despite the fact that the D622 "in most cases proved better." However, a faster algorithm was more vulnerable, in their opinion. "For example, a major miner could affect the time characteristics," Nchain said. They also added:

"We acknowledge that D601 (proposal from Amaury Séchet) may not necessarily have the highest performance, but since all 3 had similar performance, D601 was selected because it appears to have the least risk."

Why the Upgrade is Needed

Since its launch at the beginning of August, Bitcoin Cash has displayed a highly variable time between blocks being mined. With both Bitcoin and Bitcoin Cash, this blocktime is supposed to average out to six blocks per hour, no matter how much hashrate is pointed at it.

The fluctuation in the time between blocks on the newer chain is so strong that production can jump between one block every four hours to a high of 61 blocks the following hour, like it did on October 12. With such a fast production rate, the Bitcoin Cash chain has lept over 7,800 blocks (55 days) ahead of the legacy chain recently. At that rate, it would be time for the next mining reward halving event much earlier than planned. Once halved, the Bitcoin Cash blockchain would be far less profitable than Bitcoin’s blockchain and profit-driven miners would likely abandon Bitcoin Cash.

The EDA, which is responsible for these wild fluctuations, was created to help keep the mining hashrate steady during its first few weeks. Soon after the Bitcoin Cash community’s developers realized the EDA problem, a debate ensued about how to remove it and what to replace it with in order to keep the miners interested in mining bitcoin cash.

Juan Garavaglia, the CEO and founder of the Bitprim project, told news.Bitcoin.com that “we expect the new algo will mitigate fluctuations in block generation, giving Bitcoin Cash users a better user experience and is one step forward aligned with Satoshi original vision.”

Séchet shared the sentiment, telling new.Bitcoin.com that, after the upgrade:

"The hashrate on the BCH chain should be more stable, as well as the block production. We should see a split of the hashrate between BTC and BCH that is close to the split in term of price."