ETC Cooperative

2020 Retrospective

Background

What is Ethereum Classic (ETC)?

Ethereum Classic (ETC) is a peer-to-peer payment platform and a platform for decentralized applications. ETC is Ethereum technology with a Bitcoin philosophy.

Like Bitcoin, ETC:

  • Is digitally scarce, with a fixed supply monetary policy.
  • Uses the Proof of Work consensus algorithm.
  • Values censorship resistance and trust minimization.
  • Values security and safety over throughput.
  • Aims for multi-decade stability.
  • Is socially scalable within the ecosystem.
  • A grassroots movement with no ICO or premine.

Unlike Bitcoin, ETC:

  • Has rich statefulness.
  • Has a deterministic Turing machine bounded by gas (the EVM).

What is the ETC Cooperative?

The Ethereum Classic Cooperative Inc (“ETC Coop”) is a non-profit legal entity that has held 501(c)(3) public charity status since 2018. Donations to ETC Coop are tax-deductible under IRC Section 170 for US taxpayers, both individual and corporate. Enterprises investing in infrastructure or other “public goods” within the ETC ecosystem can do so in a more tax-efficient manner by donating to the ETC Coop rather than investing directly.

The mission of the ETC Coop is to steward the development of the Ethereum Classic protocol and to support the growth of a mature ecosystem around that protocol. There are three pillars to this mission:

  • Accelerate adoption of ETC technology by individuals and enterprises through effective branding, marketing, and education.
  • Foster collaboration between ecosystem participants including developers, miners, investors, enterprises, and end-users.
  • Mature Governance and Transparency – efficient and transparent governance framework, including use of funds.

This 2020 retrospective for the ETC Coop is organized around these three pillars - Adoption, Collaboration, and Governance.

Overview

The Successes of 2019

2020 was a challenging year for the ETC ecosystem after a very successful and upbeat year in 2019.

ETC was broadly seen as “a protest coin with no developers” during 2016, 2017, and 2018 which was not entirely unjustified. The only major protocol update during that period was the Monetary Policy change adopted during 2017, and ETC was getting very behind on opcode changes made in ETH. This made it unnecessarily difficult for developers to migrate smart contracts from Ethereum to ETC.

2019 was a breakthrough year where that perception started to change, with ETC Labs founding ETC Labs Core (later renamed as ETC Core), and staffing up quite aggressively. The healthiest client was Parity-Ethereum, which had supported ETC from the beginning.

The Atlantis hard fork in September 2019 brought the protocol much closer to Ethereum and was the first well-coordinated update for two years. The ETC Summit 2019 brought everyone together and was an opportunity to show all the progress being made.

Agharta and Phoenix hardforks

The second hard fork of the year was Phoenix. In addition, the originally targeted March activation did not occur until June due to a miscalculation in the estimated block for activation.

  • ECIP-1061 - Aztlan
  • ECIP-1061 - Aztlan + ECIP-1078 - Aztlan “fix”
  • ECIP-1088 - Phoenix

We lost momentum through that period, with little work done on gathering consensus for the follow-up hard-fork while Phoenix was still pending. Contention and conflict between various core developers about the Phoenix scope also resulted in the removal of ETC support from Multi-Geth and OpenEthereum in the aftermath of the hard-fork.

The shared expectation within the ecosystem was one of broad adoption of ETC by Ethereum ecosystem projects after Phoenix achieved protocol parity, but that hope did not materialize.

51% Attacks

Shortly after Phoenix, the network staggered until the heavy blows of three consecutive 51% attacks from late July through August. The details of the attacks are covered in detail later in this retrospective. The immediate consequence of the attacks was the complete suspension of ETC deposits/withdrawals at many exchanges. In the aftermath of the attacks, numerous proposals were made about potential protocol changes and mitigations without a clear path forward.

The Return of IOHK and Charles Hoskinson

One unexpected but hugely welcome side-effect of the 51% attacks was the return of IOHK and Charles Hoskinson to the ETC ecosystem. Charles decided to revive Mantis to production status and to start work on proposed protocol updates for Checkpointing and for the introduction of a Treasury.

Thanos and MESS

The Thanos hard-fork was the eventual short-term band-aid, with a single protocol change allowing the use of 4GB and 3GB graphics cards again. The Core-Geth team also implemented a non-consensus feature called MESS-ECIP-1100 - MESS (Modified Exponential Subjective Scoring), aimed as a “band-aid” protection against future 51% attacks.

What Happens Next?

We head into 2021 with continuing uncertainty about the path forward. There is a schism within the ecosystem between a “status quo” path and the “progressive” path proposed by IOHK and supported by the ETC Cooperative and much of the community.

Adoption-Comms and Marketing

Communication and Marketing are key functions for the ETC Cooperative. We had extensive outreach to help node operators around the hard-forks. Unfortunately, we also had several periods of crisis management during 2020 where our communication and community management was critical.

No ETC Summit

Due to the pandemic, there was no ETC Summit during 2020, which has been important events to bring the community together.

Other Conferences and Hackathons

Representatives of the ETC Coop attended many of the primary Ethereum hackathons and community conferences which were held prior to COVID lockdown.

  • Feb 1 to Feb 2 – FOSDEM, Brussels, Belgium
  • Feb 14 to Feb 16 - ETH Denver, Denver, CO
  • Feb 26 – EEA Meetup, London, UK

Messari Disclosures Registry Completion

The Messari Disclosures Registry population was completed during 2020 with Kevin Lord taking the lead, both while he was at IOHK and during his time at the ETC Coop.

ETC Weekly

In October of 2020, ETC Cooperative announced the formal relaunch of its newsletter now called ETC Weekly. Since then, it has sent just near 50,000 emails at the end of 2020 with an average open rate of 22%.

Developer Calls

There were a number of core developer calls during the year to coordinate on the Phoenix hard-fork and the potential 51% attack prevention solutions.

Content

ETC Cooperative put out blog posts and other articles throughout the year.

  • Vyper and Brownie Contract Development on EVM Chains — January 10, 2020
  • Hard Cap on the Gas Limit for the ETC Mainnet as In-Protocol Consensus Rule — January 17, 2020
  • The 51% Attack on ETC — August 2, 2020

Challenges

With COVID-19 travel restrictions, it has been challenging to motivate community members who have become apathetic and disengaged. Many have also been demotivated by the lack of price action of ETC in the past year.

Adoption-Development and Infrastructure

The ETC Cooperative develops projects using internal resources and funds external teams to deliver value for the benefit of the ETC ecosystem as a whole.

Hyperledger Besu Support

ETC Cooperative actively supports the Besu project and ETC Besu users. We’ve ensured ETC Besu compatibility throughout the scheduled protocol upgrades and addressed any bugs along the way as well as identified new feature priorities going into 2021.

Vyper support for ETC

ETC Cooperative funded the Vyper team to bring Vyper to ETC.

Blockscout Block Explorer

BlockScout by POA Network is the most popular ETC block explorer available, providing a pleasant user experience.

Ethercluster

Ethercluster is ETC Cooperative’s open-source alternative to Infura, providing cloud architecture for ETC or ETH endpoints.

Development and Infrastructure challenges

Our primary challenge is limited internal capacity with only two members of staff for most of 2020.

Collaboration - Protocol

The ETC Cooperative actively supports ETC core protocol upgrades and network events through collaborative partnerships and engagement with the community.

Hard-forks

In September of 2019, the ETC protocol undertook the Atlantis hard-fork. In 2020, the ETC protocol undertook 3 more hard-forks; Agharta, Phoenix, and Thanos.

Challenges - 51% Attacks

The ETC network was victim to three 51% attacks in Q3 of 2020. The lessons learned indicated that the majority attack vector is a feature of Proof of Work consensus.

Treasury, Checkpointing, Keccak-256 (Sha-3)

The ETC Cooperative particularly supports the proposals for a Treasury, Checkpointing, and Keccak-256 (Sha-3).

Adoption - Partnerships

On January 22nd, it was announced that Grayscale was extending its funding for ETC Cooperative for a further two years.

Challenges-DFG and ETC Labs

One of the most primary goals for ETC Cooperative during 2019 had been relationship building with ETC Labs.

Governance - Internal Processes

The major event for ETC Cooperative during Q1 was the AGM held on March 17 where months’ worth of work on governance came to fruition with the adoption of key documents by the Board Members.

Financial Section

For the year ended December 31, 2020, F2020 actual costs were lower than budgeted mainly due to Covid-19 restrictions.

Income

The ETC Cooperative earns income from the arrangement with Grayscale LLC, as well as donations and sponsorships. In 2020, a new fee arrangement with Grayscale for up to a 2-year period was agreed.