An Empirical Study on Governance in Bitcoin’s Consensus Evolution
Jakob Svennevik Notland, Mariusz Nowostawski, Jingyue Li · ACM Transactions on Software Engineering and Methodology · 2024
Consensus rule changes in public permissionless blockchains are challenging. Changes can be contentious, and getting all participants to agree could be tedious. Notably, Bitcoin has seen centralisation tendencies in mining and development. However, how these tendencies influence governance processes of consensus evolution has received minimal attention. We explore how the evolution of blockchain systems and the governance of consensus intertwine from socio-technical aspects. Our study analyses the governmental structures in blockchain by looking into Bitcoin. We investigate consensus change processes through grounded theory, comprising quantitative and qualitative data from 34 consensus forks in two different blockchains, Bitcoin Core and Bitcoin Cash. We explore how decentralisation and governance unfold in practice. In contrast to existing studies, we revealed that centralisation tendencies among miners and developers have no direct control over consensus rules in a blockchain. Furthermore, centralisation tendencies do not affect decision-making for consensus evolution governance in the same way as they facilitate consensus attacks, such as 51% attacks. We also discovered that consensus governance is constrained by the technicalities of change and deployment techniques. Consequently, even though miners have the authority to make consensus changes and propose new blocks, they are restricted by deployment techniques and dependence on user adoption.