ii exclusive: Jack Liao, the man behind Bitcoin Gold

It was all going swimmingly, with bitcoin crushing resistance to reach an all-time high of around $6,156 on the Coindesk bitcoin price index, but it didn't last.

At time of writing, bitcoin has lost $500 to sit at around $5,650 in a see-saw ride for investors and traders alike, as doubts surrounding the Bitcoin Gold fork due to kick in on 25 October loom large.

Interactive Investor spoke exclusively to the man behind Bitcoin Gold, Hong Kong-based businessman Jack Liao, the chief executive of bitcoin mining outfit LightningASIC. Jack is 42 years old and was educated in China.

High-profile US exchanges Bittrex and Coinbase have both issued statements in recent days pointing to what they say are problems preventing them from opening a market in the coin after the fork. Leading hardware wallet Trezor will not be supporting (i.e. allowing transactions) Bitcoin Gold either, although bitcoin owners will be credited with the new coin when it launches.

If the exchanges statements are to be taken at face value, Bitcoin Gold is nowhere near ready for primetime, with crucial code still not implemented.

The most important missing element threatening the stability of the code is the lack of protection against replay attacks. These are attacks where, theoretically, a transaction on the chain of the new fork can be 'replayed' on the bitcoin chain, which means anyone attempting to transact with Bitcoin Gold is potentially putting their bitcoin holding at risk.

In this light, it is not too surprising that exchanges and other service providers are reticent about Bitcoin Gold and are not supporting it for now.

This confusing situation potentially begs wider questions about the bitcoin network, even though Bitcoin Gold is a fork that doesn't change code on the original chain, but nevertheless can affect it through malign actors deploying the replay attack. Some put the ongoing heightened volatility and falls in the price of bitcoin at the door of Liao. How does he respond? 

What's your response to the Bittrex statement which highlights the following:

Bitcoin Gold does not currently have -

• Fully formed consensus code

• A: Developing. Some code released

• Implemented replay protection

• A: Developing

• Adequate code for testing and auditing

• A: Fully testing

• Publicly known code developers

• A: Developers not only on the list. We have enough adviser.

The website still says: "Bitcoin Gold has implemented full replay protection" when it clearly isn't the case. Will this be updated to avoid confusion?

A: Two-way replay protection will be done before release.

The private pre-mine is 8,000 according to Bittrex - Bitcoin Gold contributor on Github called starbuckBG says 75% is locked for the next three years and 25% will be released on launch for dev bounties and infrastructure. Can you confirm this is the case and does it worry you that a substantial number of coins may be dumped at launch?

A: This is not private pre-mine. Its public. The coins will be used under audit to develop ecosystem.

When Coinbase claims that the 'fork has already privately occurred' are they inferring this from the pre-mine? If coins have already been mined doesn't that require there to have been a fork?

A: It's not private pre-mine. All write on the white paper. And still not start pre-mine yet.

Bittrex also refers to a 'private pre-mine'. Can you explain how the pre-mine is being executed? Also on news.8btc.com, regarding pre-mineyou stated:

"The whole cryptocurrency community is filled with greed and selfishness. Mining pools charge 4%-5% of transaction fees and they don't have a problem with that. What's wrong with us having a pre-mine of 200,000 BTG to raise money for the development? To those who have a problem with the pre-mine of BTG: mine or fuck off."

Regarding the 200k figure, has the pre-mine been reduced to 8k in response to community concerns?

A: Yes. Qty now is 100K, 8K block. Because community give BTG good price. 100K is enough.

A pull request [on the Github code repository - a pull request is to the admin of the master code to include new code] with code for a potential solution to the replay issue was, for example, made by heyrhett three hours ago, but it still hasn't been reviewed and no one has been assigned (I think the code is based on work by Maxwell from the bitcoin core dev team, presumably used in the Bitcoin Cash fork). Does the project have enough dev resource?

A: We have enough dev. But time is limited. We start it just after BCC [Bitcoin Cash] fork. Build up team, confirm plan, code, etc. [the preferred fix, according to the White Paper released yesterday - 23 October - is the SIGHASH_FORKID parameter method used by Bitcoin Cash, which signs individual transactions with a signature unique to the new chain]

Why is the lead dev (h4x3rotab ) anonymous?

A: [Don't] know why. He likes to be anonymous.

The decentralization aim is laudable by blocking ASIC with the switch to the Equihash proof of work, but what's to stop an entity from amassing GPUs on a scale that also endangers decentralization?

A: Every miner can buy GPU at similar price. This can protect GPU mining be decentralized. Only when AMD, NV [Nvidia] jump to mining. AMD NV won't jump to run mining biz.

Do the likes of Bitmain make it difficult for LightningASIC to compete (and of course the little people with a couple of GPUs) and is this a motivation for the Bitcoin Gold fork?

A: No. We are still producing ASIC miner. And performance is good. Better than BITMAIN.

What is the hash power of the LightningASIC setup compared to Bitmain?

A: We have few hashpower. We prefer sell miner to other player.

There are rumours on bitcointalk and reddit that Bitcoin Gold has support from some bitcoin core devs. Is this the case? Are some core devs worried about SegWit2x in November? You told news.8btc.com that Adam Black is a supporter. I don't see him listed as a core dev. What's his significance?

A: No any core developer support us. Luke [Luke Martin - high-profile crypto analyst and investor] strongly ageist BTG project. I asked for the help. But they refused. And Adam Black just twittered that he likes btg more than bcc and b2x [Bitcoin SegWit2x fork].

You have issues with Bitcoin Cash. Why do you object to their scaling solution?

A: Bitcoin cash is just scam. Bitmain SIGNED ON NYA. [NYA refers to the so-called New York Agreement, which was a statement issued by the Digital Currency Group on 23 Maywith 58 signatories. It aimed to end the war between the segregated witness camp and those who wanted to directly increase the block size. It paved the way for the SegWit2x solution which will be fully implemented in a mid-November fork.] They betrayed whole NYA signer. Bcash is supported by bitmain. Viabtc, btc.top, bitkan are just white gloves.

Do you think the confusion and worries around the BG fork are damaging bitcoin or is it the fault of exchanges such as Coinbase (which didn't distribute Bitcoin Cash which annoyed its customers) and Bittrex that are spreading fear, uncertainty and doubt?

A: BTG protecting BTC. GPU mining won't grad ASIC hashpower. Coinbase, bittrex's worrying is just because they don't know all btg details. When code online, they will change their idea. Be patient.

BTG hard fork will prove one thing: algo can be changed. All evil miner can be fired.

Given that there are just 24 hours to go before launch, might it not be prudent to start the fork at a later block than 491,407?

A: BTG fork has 3 steps: snapshot, testnet, launch. We still have 1-2 weeks to release final code. Today [24 October], it's not fork, just snapshot to confirm who has BTG.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.