Bitcoin Cash miners have been told that they face a 12.5% tax on the blocks they mine as part of an “infrastructure funding plan”. But why has the tax been levied, and what does the community think of it?
From Voluntary to Mandatory “Donations”
Bitcoin Cash’s infrastructure funding plan was announced on Medium by Jiang Zhuoer, CEO of mining pool BTC.TOP, who began the piece by criticizing the existing method of raising funds for developers. Zhouer complained that the current system of miners voluntarily donating a portion of their income to developers left corporate donors with “an undue influence on developers” and promoted an uneven system where some members were “free riders” and others bore the community development costs.
Zhuoer’s solution is to adopt a system similar to that used by Zcash and force all miners to pay a 12.5% tax on their block rewards, with anyone not contributing having their blocks orphaned. The collected money will be paid into “a Hong Kong corporation” that has been “set up to legally accept and disperse funds.”
Zhouer Braced for Negative Reaction
Although the main beneficiaries of this plan is the Bitcoin Cash ecosystem, some in the community may have reservations or objections to this plan because it is somewhat unprecedented and represents a departure from tradition. But the conditions are ripe and the plan makes sense at this time.
In other words, it’s happening, get used to it. The new protocol, which will go live on May 15 along with a scheduled protocol upgrade, will be trialed for six months to gauge success.
The response from the non-Bitcoin Cash community was a cross between horror and disbelief:
BCash going full centralization, introducing a “miners tax” of 12.5% to be payed into a Hongkong company (run by Ver?) https://t.co/5qSJ6hmm2G
— Tanuki ?⚡️? (@TanukiBTC) January 22, 2020
Bitmain, with support from Roger Ver and (as a result) the BCH community, are proposing a new 12.5% dev fee be taken from BCH block rewards. If you dont pay the 12.5% tax they will orphan your blocks. Just another reason why Bitcoin Cash is NOT Bitcoin.https://t.co/b7Ru9NSdSX pic.twitter.com/58HUKH9jMD
— crown.btc (BTC is Bitcoin) (@barackomaba) January 22, 2020
RT WhalePanda: $BCH implementing a 12.5% miner’s tax is hilarious and anyone not donating will have their blocks orphaned.
Literally a centralized totalitarian regime with a 51% attack threat.
“A Hong Kong corporation has been set up to legally accept an… https://t.co/H7sFcLgPI0
— Airdrop Tweet (@BotAirdrop) January 23, 2020
Only time will tell what the smaller miners think of the plans, but we’re pretty sure we can guess their reaction…