Bitcoin Cash (BCH) underwent a pivotal hard fork on November 15, 2020 — an event that reignited debates over governance, decentralization, and the future direction of one of cryptocurrency’s most controversial networks. This article breaks down the background, key players, technical changes, and real-world implications of the split between Bitcoin ABC and Bitcoin Cash Node (BCHN), helping you understand what happened, why it mattered, and how it shaped the landscape of BCH moving forward.
The Core of the Conflict: Infrastructure Funding Plan (IFP)
At the heart of this hard fork was the Infrastructure Funding Plan (IFP) — a proposal introduced by the Bitcoin ABC development team that would redirect 8% of each block reward to fund ongoing development efforts, particularly for Bitcoin ABC itself.
While funding open-source development is a common challenge in blockchain ecosystems, the IFP sparked intense backlash for several reasons:
- Philosophical opposition: Many in the Bitcoin Cash community believe that miners should keep 100% of block rewards. Forcing a mandatory “miner tax” is seen by critics as centralizing control and contradicting the decentralized ethos of cryptocurrency.
- Security concerns: Reducing miner rewards could make mining less profitable, potentially leading to lower network hash rate and reduced security.
- Lack of transparency: The Global Network Council — tasked with overseeing fund distribution — had not disclosed its membership or decision-making process, raising fears of bias and favoritism toward Bitcoin ABC.
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This disagreement wasn’t just technical — it became a battle over values, power, and the long-term vision for Bitcoin Cash.
Competing Clients: Bitcoin ABC vs. Bitcoin Cash Node
In response to the IFP, a group of developers and community members launched Bitcoin Cash Node (BCHN) — a client that removed the IFP from its codebase while maintaining compatibility with core Bitcoin Cash protocols.
The emergence of BCHN represented more than just software divergence; it reflected a grassroots movement within the community to preserve what many saw as the original spirit of BCH: miner sovereignty, open development, and resistance to top-down control.
Despite both clients agreeing on most protocol upgrades, their philosophical divide over funding created two competing visions for BCH’s future.
Protocol Upgrades Beyond IFP: ASERT vs. Grasberg
While IFP dominated headlines, another major technical debate centered around difficulty adjustment algorithms — critical components that regulate how quickly new blocks are mined.
Bitcoin Cash shares its mining algorithm with Bitcoin (BTC), making it vulnerable to hash rate fluctuations. When BTC mining becomes less profitable, some miners temporarily switch to BCH, causing sudden spikes in block production. Conversely, when they leave, block times slow dramatically — creating an inconsistent and unreliable user experience.
To fix this, Bitcoin ABC initially proposed Grasberg, a new difficulty adjustment algorithm designed to stabilize block times. However, Grasberg included a controversial feature: it intentionally slowed down block production over time to correct “historical drift” — the fact that BCH blocks had been mined faster than intended since launch.
Critics argued that artificially slowing down the blockchain was unnecessary and potentially harmful. In contrast, BCHN adopted ASERT (A Sharper Emergency Response Tool) — a more responsive and widely respected difficulty adjustment mechanism already used in other networks like Bitcoin SV.
Eventually, Bitcoin ABC abandoned Grasberg and adopted ASERT as well — eliminating one major point of technical conflict between the two camps.
Dual Client Strategy: Why Two Versions of Bitcoin ABC?
In a surprising move, the Bitcoin ABC team released two versions of their client software ahead of the fork:
- One version included the IFP — aligning with their official roadmap.
- The other excluded IFP entirely — making it fully compatible with BCHN.
However, only the IFP-enabled version would receive full support and future development updates. The IFP-free version would be maintained at a minimal level — essentially serving as a compatibility bridge.
This dual strategy was interpreted by many as an attempt to appear flexible while still pushing forward with their funding agenda. It also highlighted the growing pressure on Bitcoin ABC to avoid a messy chain split.
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Will There Be a Token Split?
A token split only occurs if both chains attract sufficient hash power to sustain independent block production.
At the time of the fork:
- Bitcoin Cash Node (BCHN) commanded over 80% of network hash rate.
- Bitcoin ABC had less than 1%, indicating weak miner support.
Moreover, major exchanges like Coinbase, Kraken, and BitGo publicly backed BCHN, signaling strong ecosystem alignment.
Given these conditions, a clean split was unlikely. Instead, the most probable outcome was that BCHN would become the dominant chain — effectively continuing as "Bitcoin Cash" — while Bitcoin ABC risked becoming irrelevant unless it gained significant support.
There was one theoretical scenario where Bitcoin ABC could prevail: if it suddenly attracted majority hash power after the fork. In that case, even if BCHN miners started building their own chain, they could be overtaken within ten blocks due to superior computational power — causing their chain to collapse under the rules of longest-chain consensus.
However, this scenario was considered highly improbable given the lack of mining and exchange support.
What Happened After the Fork?
Post-fork developments confirmed early expectations:
- Bitcoin Cash Node (BCHN) emerged as the de facto continuation of Bitcoin Cash.
- Most services began referring to BCHN as “BCH,” while exchanges that supported both chains labeled the ABC version as “BAB” or similar.
- The original Bitcoin ABC chain struggled to gain traction and eventually faded from relevance.
The market outcome validated the principle that code alone does not determine legitimacy — hash power and community consensus do.
Frequently Asked Questions (FAQ)
Q: What is the Infrastructure Funding Plan (IFP)?
A: The IFP is a protocol rule proposed by Bitcoin ABC that redirects 8% of each block reward to fund development teams. Critics call it a “miner tax” and oppose it on philosophical and security grounds.
Q: Did the hard fork result in two separate coins?
A: Technically yes — two chains were created. But due to overwhelming hash power and exchange support for BCHN, only one chain (BCHN) survived as the legitimate continuation of Bitcoin Cash.
Q: As a BCH holder, what should I have done during the fork?
A: If you held your private keys, you likely received coins on both chains. However, due to no replay protection, sending transactions immediately after the fork carried risks. It was safest to wait until network stability was confirmed.
Q: Why did so many miners support BCHN over Bitcoin ABC?
A: Miners preferred BCHN because it preserved full block rewards without mandatory deductions. Higher rewards mean better profitability — a strong economic incentive.
Q: Is Bitcoin ABC still active today?
A: While technically operational, Bitcoin ABC lost most of its network support after the 2020 fork and no longer represents the main Bitcoin Cash chain.
Q: How can future forks be avoided in decentralized networks?
A: Clear governance models, transparent decision-making, and broad community consensus are essential. Imposing changes without broad agreement risks fragmentation and loss of trust.
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Conclusion
The 2020 Bitcoin Cash hard fork was more than a technical upgrade — it was a referendum on governance, fairness, and decentralization. The decisive victory of Bitcoin Cash Node demonstrated that even well-established development teams cannot override community will without consequences.
For users and investors, this event underscores a vital lesson: in blockchain networks, real power lies not in code or proposals — but in consensus.
Core Keywords: Bitcoin Cash, hard fork, Infrastructure Funding Plan, Bitcoin ABC, Bitcoin Cash Node, ASERT, blockchain governance