In this past month, it seems like alternate cryptocurrencies have been all the rage. Earlier last month, Sunny King released Primecoin, a prime-number based cryptocurrency that is the first to attempt to make its mining algorithm simultaneously serve some kind of social value, and the currency was mentioned on BusinessInsider less than two days after launch. The currency then grew quickly, getting its own gambling site and exchange within three days. The surprising thing is that Primecoin is not unique in this. Over the past two years, we have seen the development of over seventy alternate currencies with features ranging from a smaller or larger number of coins to faster confirmations and radically different alternatives to Bitcoin’s proof of work.
One of the less radical alternatives in the alternative cryptocurrency, or “altcoin”, scene is Feathercoin, a currency introduced by Peter Bushnell on April 16, 2013. On a technical level, Feathercoin started off not being significantly different from Litecoin; the only change was an increase in the final currency supply from 84 million to 336 million. Later on, however, the currency developed other small differences; one change is faster difficulty retargets, allowing the network to adjust more quickly to changes in network power. Another is an advanced checkpointing system, which lead developer Peter Bushnell says will make Feathercoin “more resilient to 51% attacks than Bitcoin or Litecoin.” More importantly, however,Bushnell explains, the real attraction of altcoins is not necessarily just the minor details of their core features, but also the surrounding ecosystem. The ecosystem around Bitcoin is bloated; major changes to the main client are always met with great opposition, and for good reason – a billion dollar economy depends on it. “Feathercoin,” Bushnell writes, “by comparison is dynamic and agile. It is hard for people to get involved in Bitcoin in the same way that they could be involved in Feathercoin, we are still young and look to remain open to new people and ideas. Feathercoin has proved that it is able to evolve when faced with problems and looks to become more resilient than Bitcoin.”
Some of the newest developments around Feathercoin include the United Open Currency Solutions Group (UNOCS), an advocacy group made in collaboration with WorldCoin and PhenixCoin, a system to protect against attacks known as “advanced checkpointing”, and an E-bay style marketplace. Feathercoin now has the sixth largest market capitalization of all cryptocurrencies, placing it above Novacoin, Primecoin and Devcoin but below PPCoin, Namecoin and the “big three” of Bitcoin, Litecoin and Ripple. In this interview, Peter Bushnell shares his thoughts on why he created Feathercoin, the current situation that alternative currencies are in, and the promise that they offer for the future.
Vitalik Buterin: What’s your personal background? What were you involved in before Bitcoin, and how did you first find out about Bitcoin? What about the currency interested you?
Peter Bushnell: For the last eleven years I have been working as Head of IT at Brasenose College which is one of the colleges that make up Oxford University. It is a long time to be in any one place and now that I’m working with crypto currencies life is a lot more fast-paced and infinitely more interesting. I first heard of Bitcoin from New Scientist many years ago, before I actually become involved myself. When I first arrived on the scene in late 2011 I started mining Bitcoin, which was very unsatisfactory as I could only mine 0.1 coins a day. I was not mining as a means to make some money but just to play and collect some coins; I have always had an enthusiasm for technology and computers which is why I ended up working in IT professionally. Finally, I found Litecoin, which at the time was very young and had hardly any value, and the joy of Litecoin was that I could actually mine many of them. When I first found Litecoin there was a fair bit of enthusiasm surrounding it, and many saw it co-existing happily with Bitcoin – which I believed to be true.
What interested me about Bitcoin was the fact that it worked. When I read the New Scientist article I was intrigued as I imagined it would be a tough task getting a value attached to these Bitcoins, but there the markets were which gave Bitcoin its value and allowed the whole world to trade with one another almost instantly without having to use the traditional and costly banking systems.
Vitalik: What made you decide to create an alternative cryptocurrency?
Peter: I am a big supporter of Litecoin, but I found that it had run out of steam as there seemed to be little effort to progress, my emails to Litecoin devs went unanswered and I had to question what I really knew about Litecoin. Having a Scrypt coin made sense as GPU miners were soon to be looking for a new home with the coming of ASIC miners, and I was waiting for another Scrypt coin to jump on to and had in my mind what I wanted ideally. Mincoin came along, but it launched without a Qt GUI and had very large rewards for initial blocks. This seemed largely unfair. We then saw the Russian Novacoin launch which was pre-mined before it was launched to the public, and I also saw that as unfair.
I had the idea of a coin that simply followed on what Litecoin had started with Bitcoin by having four times as many coins as Litecoin; that seemed to be the next natural step. It occurred that I could code the coin myself, which is exactly what I did. The good news since Feathercoin launched is that Litecoin woke up and did something – competition is a good thing.
Vitalik: I understand it, Feathercoin’s only two technical differences from Litecoin are 4x faster difficulty retargets and 4x more coins. Why did you decide to change these aspects of Litecoin? Why are these features important? Are there any other differences between the two that I’m missing?
Peter: The core difference at the beginning was simply four times as many coins, like Litecoin having four times as many coins as Bitcoin. Since our launch we have changed to incorporate a four times quicker difficulty adjust which works better for a network smaller than that of Bitcoin or Litecoin. This shows the willingness to evolve to deal with problems that our network is faced with.
Right now, we are working on a feature known as advanced checkpointing. Currently blockchain checkpoints are compiled into the client which has to be redistributed. To protect against attackers orphaning genuine blocks, checkpoints will be issued after blocks have been created. Advanced Checkpointing prevents 51% attacks and is an example of where smaller coins contribute to all crypto currencies. Smaller coins have to deal with a lot of things that do not concern Bitcoin or Litecoin. With Advanced Checkpointing implemented Feathercoin will be more resilient to 51% attacks than Bitcoin or Litecoin.
Vitalik: Could you explain to me how this advanced checkpointing mechanism works?
Peter: Feathercoin experienced 51% attacks where the attackers managed to orphan genuine blocks and get their own mined blocks accepted by the network. This is very frustrating to the miners and exposes users to the risk of reversed transactions. Bitcoin includes a checkpointing system to solve this problem, where certain blocks can be hardcoded into the client so that your client will only ever connect to the blockchain with those blocks in it.
Advanced Checkpointing works by providing a feed of checkpoints that clients subscribe to. When a block gets created it will be checkpointed automatically by a single node in the first iteration of the software. This checkpoint will be put into a feed which other clients will be subscribed to. The other clients will pick up this checkpoint and will start rejecting blockchains that do not include the block referenced in the checkpoint. This is not mandatory as clients can opt-out. If the feed goes down, the network carries on as normal and when the feed comes back it starts checkpointing from the end of the network blockchain.
This system needs to be distributed to be made more resilient and move away from the centralization that this introduces. This solution upsets the purists but is the lesser of two evils. We have experienced several 51% attacks on the Feathercoin network and we would rather see the network out of attackers’ hands. The attackers that have been targeting us have 3GH Scrypt or 3TH SHA-256 of mining power. The attackers have excellent knowledge of exactly how the network operates and have run some impressive attacks. Our hashrate is to high for them to attack Feathercoin right now but they could get more hash power but for now they have moved on to other smaller coins. With attackers like this out there everyone should be worried.
Vitalik: If someone on the street (or the internet) asked you “why should I use Feathercoin?”, how would you answer?
Peter: Feathercoin is a very active coin with a lot of enthusiasm. We have very different pressures compared to Bitcoin which is making us evolve much faster than the lumbering giant that Bitcoin has become. It is indeed hard for Bitcoin to move too fast without creating a lot of upset. Feathercoin by comparison is dynamic and agile. I always encourage people to visit the Feathercoin forum as anyone can get involved. We are a transparent coin with an active community. It is hard for people to get involved in Bitcoin in the same way that they could be involved in Feathercoin, we are still young and look to remain open to new people and ideas. Feathercoin has proved that it is able to evolve when faced with problems and looks to become more resilient than Bitcoin.
Vitalik: Much of the Feathercoin community’s emphasis so far, as I understand, has been on creating better software, tutorials, marketplaces and the like. Why not simply make better software, tutorials and marketplaces for Bitcoin?
Peter: We need diversity if something is going to survive, it is simply the survival of the fittest. A lot of people complained that Litecoin was going to damage cryptocurrency, which to me seemed absurd as Litecoin was clearly trying something new. What I find disappointing is how many people with Litecoin in their pockets now throw stones at Feathercoin for those same reasons. Having many coins trying different things will allow us to explore what works in cryptocurrency; as long as these coins have some value on the market then they can be used to send money around the world.
Vitalik: What is your opinion on the state of alternative cryptocurrencies in general?
Peter: I believe that cryptocurrencies right now are in a bit of a lull. There are some major obstacles that we are faced with which makes things seem a bit gloomy to some. Gox is a good example of the troubles experienced dealing with banks and payment processors. What people do not realize is that are so many people working to solve some of these obstacles and there are already several solutions coming on to the horizon. The world of cryptocurrency is going to look very different in a couple of years’ time.
Vitalik: What role do you see alternative cryptocurrencies playing in the future? Do you expect any of them to overtake Bitcoin in the near or mid-term future? If so, what would be some of the factors driving such an outcome?
Peter: Alternative cryptocurrencies is where we are going to see the real technical progress made. Bitcoin needs to try and maintain a steady course, whereas the other currencies can evolve much faster. Feathercoin has more coins than Bitcoin by design so that it can exist as a lower value coin. This is supposed to remain true, and Feathercoin should not threaten Bitcoin’s value directly. Since Feathercoin is an open source project leaves, any innovations made in the client can be picked up by Bitcoin. As long as Bitcoin remains active and adapts then I expect it to remain a strong force for cryptocurrency adoption.
Vitalik: Feathercoin, Worldcoin and PhenixCoin recently partnered to form the “United Open Currencies Solutions Group”. Could you explain in more detail what this organization is, and what its objectives are?
Peter: The idea behind UNOCS is that working together we can do more than apart. UNOCS gives us a name under which we can undertake joint projects. I would like to see more coins work together rather than just view everyone else as a threat. It’s not a merger; even though we have this partnership together, we are all still independent coins. The organization’s first project will be the UNOCS Bridge, which allows merchants to accept all UNOCS coins without having to wait for transactions as all the coins are held in the system. The system handles exchanging between coins and eventually will allow people to move to fiat. That is the long term goal – to ease movement between crypto and fiat. here does seem to be a lot of people working towards solutions like this which I find very reassuring, as moving from fiat to crypto and back can be far more difficult than it should be. I find that the legacy banking seems to be somewhat hostile to cryptocurrency.
Vitalik: What are some of your future plans with Feathercoin, both in the near and long term?
Peter: The main objective of Feathercoin is to survive long term, to continue to adapt to the world it finds itself in. There are many opportunities for cryptocurrency and we do not intend to miss them. There are places in the world local currency is having trouble where cryptocurrencies could be a real solution, we are looking to lower entry requirements to cryptocurrency by implementing SMS based wallets. This increases access to Feathercoin in places that do not have high end smart phones available. I hope that cryptocurrency can solve some of the financial problems that the world faces today, giving anyone with a basic phone access to a cryptocurrency account puts a lot of power back into the hands of the people. You can see that all these efforts are working to a time where cryptocurrency finds its critical mass. Cryptocurrency is going to be the biggest technical innovation since the birth of the Internet.