Some time ago I deployed a token contract called BitEther Coin (BEC). The idea is simple — an ETC miner participating in this experiment is getting an additional BitEther token reward to Ether reward received from a block. The Miner gets both Ether (5 ETC per block) and BitEther (2 BEC per block).
This is not a modification of the protocol, nor is it a hard fork or soft fork. It is just a standard feature provided by the existing technology and capability of the ETC system.
By doing this I am trying to show that Ethereum Classic is not the same chain as others: it has more powerful technology which allows you to build your own blockchain layer on top of it. Security of the network can be supported by any participant or by any business building on top of the chain.
BitEther Supply Model
The BitEther Token follows the Monetary Supply of Bitcoin. My initial goal was to make it issue 50 tokens every 10 minutes, with a halving every 4 years.
In practice, BitEther «big block» time is less that 10 minutes, because an additional goal was to reach 99% of total token production at about same time as Bitcoin will. As a result, BitEther issues 50 BEC coins every 6–7 minutes, and halves every 3 years.
How Mining Works
BitEther is a contract on the Ethereum Classic blockchain. To perform cross-mining, a miner is required to include a special transaction («claim») into a block to execute that contract.
When this occurs, the miner of the current block receives the reward, no matter who originally sent that transaction («claim»). The Miner, or anyone else, can send this claim transaction to the network, but in a standard situation there is no guarantee that this transaction will come into the current block. So for most miners, especially small ones, it can become a little expensive to send this claim transaction and spend gas on it, but then have bigger miners receive the reward for that block.
To improve that situation, I have included a patch for Parity, which puts the BitEther claim transaction into the current block without sending the transaction to other peers until the block gets successfully mined and the transaction is added in that block. This actually makes it free for the miner, because gas paid for the transaction will be returned back with block fees.
A more standardized solution is going to come later, as well as a way to mine BitEther with Geth. But for now please follow these simple steps how to start mining BitEther with Parity 1.4
The good news is that, as an end user, you don’t have to install any special software or wallet to start using BitEther. BitEther implements the ERC20 standard for tokens on the Ethereum Classic blockchain, which is supported by most major Ethereum Classic wallets and development tools. You just need to input the following address as an ERC20 token:
Why It’s Important
BitEther shows that Ethereum Classic is not a standard blockchain with just one main token. In fact, multiple independent tokens may operate on the platform. The Core token (ETC) is ideal for paying for transactions (commonly known as “gas”), obviously. But for other use cases such as payments, store of value, and transfer, there can be many alternatives, each of them can have their own model and any special features, and any of them can be used for securing the network, independently.
BitEther is following the Bitcoin model, and in theory should give the same values. Actually it works even better because the average transaction confirmation time on ETC 15 seconds instead of Bitcoin’s 10 minutes, and it has native support for smart contracts. It can be an ideal token for value transfer and store of value on the ETC blockchain and to help secure the network.
I have few ideas of promising applications where BitEther can be very useful, more about it later.
How It Can Help ETC Core Development
Maybe you’ve noticed, BitEther is designed to issue a few coins every ETC block, but only if miners have included a claim for the BitEther contract in that block. What if miners haven’t included the claim? This is currently mostly the case because BitEther mining is just getting adoption from miners. Unfortunately, the contract cannot distribute reward coins post factum, so what to do with these unclaimed coins?
Currently all those coins are going to a special «satoshi address».
If you know me, you also know how hard I work on developing all core ETC projects and on bringing more developers on board. You also know how expensive software engineering is. I would like to use these unclaimed coins to support development of ETC core projects, and to help other projects important for ETC growth.
And actually, the success of ETC will bring success to BitEther, so that’s important.
UPDATE: just for clarification, Bitether wasn’t designed to fund development or anything, but after recent conversation I realized that it can be used in such way. If it will get a value, of course
BitEther is kind of new, and most mining pools don’t know about it yet, but there are a few pools which have already configured their nodes to cross mine with BitEther. For example, ePool (https://epool.io/), a pool which has supported ETC since day one, now supports BitEther as well. BitEther payouts aren’t automated yet, as I understand, but you already can join ePool and mine for both ETC and BEC there.
Also, I’m aware of a new pool, which is in development at the moment, but this pool is going to focus on BitEther once launched. UPDATE: It’s http://bec.minerhub.io/
More updates and further details for this idea is coming later…