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Are Ethereum Classic Vision & Nowa Hard Forks Serious Projects or Scams?

Ethereum Classic Vision Nowa Hard Forks

After months of decline culminating in an 18-month low of around $83 on December 15, Ethereum’s price has made significant gains heading into 2019. On January 5, Ethereum hit $160 – almost double December’s low point. The main driver behind the price movement is widely considered to be several upcoming Ethereum forks.

First among the Ethereum forks will be the creation of Ethereum Classic Vision, scheduled to occur on January 11. Unlike the much-anticipated Constantinople upgrade set for January 16, Ethereum Classic Vision will spin an entirely new cryptocurrency off from the main Ethereum blockchain. All Ethereum holders will receive ETCV in a ratio of 3 tokens for every 1 ETH they hold.

Ethereum Nowa will hard fork a day later, on January 12. Nowa will be distributed to all Ethereum holders at a 1:1 ratio. The project is also offering additional Nowa tokens to investors ICO-style at an undisclosed “preferential rate” through the project’s website.

With Ethereum gaining value rapidly in anticipation of the Constantinople upgrade, do Classic Vision and Nowa represent a serious threat to the cohesion of the Ethereum community? Or are they insignificant projects looking to piggyback off the headlines being generated by Ethereum’s Constantinople fork?

What Upgrades Are Ethereum Classic Vision & Nowa Promising?

As explained in this Medium post, Classic Vision is aiming to solve many of the same problems as the Constantinople upgrade, such as scaling and the ‘difficulty bomb’ that sees Ethereum mining becoming prohibitively difficult as time goes on. However, ETCV claims to be moving faster on many long-discussed upgrades to Ethereum than supporters of the Constantinople upgrade.

The official website of the breakaway cryptocurrency, ethereumcv.io, states that “the technological solutions advanced by the Ethereum Foundation and by the community must be implemented as soon as possible – and not several years from now, as it seems to be happening with Proof-of-Stake and sharding.”

Proof-of-Stake

The Ethereum Foundation has been planning a gradual switch to Proof-of-Stake (PoS) for same time. Transactions on the Ethereum network are currently conducted using a similar Proof-of-Work (PoW) consensus mechanism to that utilized by Bitcoin, whereby miners verify transactions and receive block rewards by solving complex mathematical problems. PoS works by allowing Ethereum token holders to receive a share of the block rewards that would usually be allocated to miners in exchange for verifying network transactions. For a general overview of the relative advantages of PoS and PoW, you can read this article we published on the subject in November.

Neither the Constantinople upgrade nor ETCV are proposing an immediate switch to PoS, but ETCV claims to be moving to this consensus mechanism much more quickly. The official website is vague on exactly when this switch to PoS will occur however, simply stating that “[w]e hope to achieve a full transition to PoS mining and validation much faster than it happens in the Ethereum network.”

Sharding

Sharding is a proposed solution to Ethereum’s scaling problem that would see the blockchain divided into smaller ‘shards,’ thus reducing the network-slowing effect of increased network activity. For a more complete understanding of what sharding is and how it would apply to Ethereum, BlockGeeks guide to sharding provides an accessible overview.

As with PoS, sharding is supposed to be implemented on the Ethereum network in future, but is not part of the Constantinople upgrade. The roadmap on ethereumcv.io states that ETCV aims to implement sharding by Q3 2019.

DEX Integration

ETCV’s whitepaper states that a core principle of the project will be integration with the VisionDEX decentralized exchange, to give holders greater control over trading of their tokens. The roadmap on ethereumcv.io states that this decentralized exchange will be implemented by Q2 2019.

Enhanced File Storage Capabilities

ETCV’s roadmap promises testing of a decentralized file storage model by Q3 2019, and integration of the InterPlanetary File System (IPFS) P2P distributed file storage and sharing mechanism by Q4 2019. These upgrades are all aimed at providing ETCV with increased functionality over Ethereum as a dApp platform.

ETCV also rejects charging storage fees for smart contracts. As explained here, Ethereum’s core developers consider smart contract storage fees as necessary to stop the blockchain becoming bloated with dead and abandoned smart contracts. ETCV’s website straightforwardly rejects this idea: “Launching a smart contract will incur a minimal one-time fee; unused contract can be placed in temporary sleep state as a result of a vote.”

No Reduction in Block Mining Rewards

A core proposal of Ethereum’s Constantinople upgrade is to reduce mining rewards for 3 ETH to 2 ETH per block. This is intended to delay the ETH mining difficulty bomb, but this reduction in mining rewards has obviously not been well-received by many Ethereum mining groups. Despite aiming to move from a PoW mining model to PoS faster than Ethereum, ETCV is also seeking to win over miners by promising that “ETCV miners do not need to worry that their reward will be arbitrarily lowered.”

Essentially, ETCV is promising to do what Ethereum is planning to do, but sooner and better, while also getting rid of potentially unpopular developments such as smart contract storage fees and reduced block rewards for miners. There is little detail on how these goals will be achieved, however.

Ethereum Nowa is even vaguer in its claims. According to ethereum-nowa.com, the project will also switch to PoS and offer 20,000 transactions-per-second in place of the “dozens” it says Ethereum is capable of. There is also the promise of having a DEX up-and-running by Q4 2019.

Who is Behind Ethereum Classic Vision & Ethereum Nowa?

It’s surprisingly difficult to discover exactly who is behind the Ethereum Classic Vision fork. Both the official ethereumcv.io website and the ETCV whitepaper make only vague references to Ethereum Classic Vision’s “team”. The project’s Twitter account began hyping the fork on Christmas Day 2018 and offers scant insight to who is behind the fork.

Ethereum Nowa initially attempted to instil confidence in the project by being appearing to at least be transparent about who was behind it. However, as this BitcoinTalk.org forum post details, the supposed Nowa ‘team members’ pictures were all taken from stock photos. The ‘Team’ section has since been removed from the official website.

Should Ethereum Holders Care?

Whether the Ethereum Classic Vision project is a long-term success or failure is of little importance to current Ethereum holders – if you have Ethereum in your wallet, you’ll receive free ETCV tokens. And as long as you don’t contribute to the crowd sale, the same is true of Ethereum Nowa.

But both projects’ websites raise a lot of red flags. Classic Vision’s road map mostly consists of vague promises that the project will do things better and more quickly than Ethereum, while the whitepaper runs to a measly 15 pages with little in the way of references. But these materials at least exhibit the grammatical mastery of English you would expect of a serious project, which is more than can be said for Ethereum Nowa. And whoever is really behind Nowa hasn’t even gone to the trouble of putting together an pamphlet-length whitepaper.

Overall, Ethereum Classic Vision seems more like a Bitcoin Gold than a Bitcoin Cash: a largely inconsequential attempt to spin a fresh cryptocurrency off a more established name, rather than a contentious splintering of the Ethereum community. Timing the launch around the much-anticipated Ethereum Constantinople update seems to be a conscious attempt to generate as much publicity for Ethereum Classic Vision as possible. Even the name of the project feels unimaginative, combining the Ethereum Classic of ETH’s much-more momentous 2015 hard fork with the headline-grabbing Bitcoin Cash Satoshi Vision spin-off.

By attaching its airdrop of free tokens via an Ethereum hard fork to a crowd sale, Ethereum Nowa is potentially more nefarious. Think very carefully before doing anything but offloading the tokens you automatically receive following the hard fork.

About Christopher Williams

Christopher Williams is a British writer based in South Korea with a strong interest in emerging technologies, cryptocurrency, and the development of decentralized apps.

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