LayerTwo Labs-backed eCash fork proposal tests bitcoin property-rights norms

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ECash fork tests bitcoin rights

Highlights

LayerTwo Labs proposes an August eCash fork at block height 964,000, mirroring Bitcoin balances but excluding Satoshi-linked addresses from one-for-one copying.
About 600,000 eCash will be allocated to dormant addresses and 500,000 eCash to pre-launch investors, with no BTC moved or accessed on the original chain.
Industry leaders warn the selective treatment of dormant addresses could erode confidence in bitcoin's monetary credibility, raising ethical and legitimacy concerns around forks.

August fork structure and funding plan

As reported by CoinDesk, eCash is a proposed Bitcoin fork set for August at block height 964,000, copying Bitcoin's history up to that point and initially mirroring holders' balances on the new chain. Under the plan described by Paul Sztorc, CEO of LayerTwo Labs, users holding BTC would receive matching eCash balances, but addresses associated with Satoshi-linked holdings would not be copied one-for-one.

The proposal would allocate about 600,000 eCash to those dormant addresses and redirect the remaining 500,000 eCash to investors who fund the project before launch. Sztorc says this does not move any BTC because access to bitcoin on the original chain still requires Bitcoin software and the relevant private keys, which he says the project does not have.

Sztorc has spent years advocating Drivechains through BIP300 and BIP301, a sidechain-related proposal that Bitcoin Core has not adopted. He says he would cancel eCash if Bitcoin activates those proposals before August, although the text indicates there is no sign of that happening.

Industry backlash and broader market implications

Critics argue the dispute is not about technical theft on the Bitcoin network, but about whether a fork can claim legitimacy while changing balances at addresses the user does not control. That concern is amplified because the untouched Satoshi holdings are widely seen by bitcoin supporters as evidence that the network's rules apply equally, even to its creator.

Beau Turner, CEO of mining firm Abundant Mines, told CoinDesk by email that any attempt to improve Bitcoin by violating the creator's property rights is a serious ethical error. Vijay Selvam, author of Principles of Bitcoin, also argues on X that treating dormant coins differently, even in the name of protection, risks undermining confidence in bitcoin's long-term monetary credibility and durability.

The timing adds to the sensitivity because bitcoin users have recently been debating whether old quantum-vulnerable coins, including addresses believed to belong to Satoshi, should be frozen or restricted. Even if eCash fails to gain economic relevance, as many forks do, the proposal still tests Bitcoin's social boundaries by asking whether a copied chain can alter a historically symbolic balance and still claim Bitcoin's moral inheritance.

Our earlier coverage of U.S. lawmakers challenging recent SEC crypto guidance examined how senators argued that broad exemptions for many digital assets could weaken investor protections and open regulatory loopholes. We also outlined concerns that unclear classification of tokens and stablecoins could increase market, cybersecurity, and volatility risks as Congress debates new crypto market-structure rules.

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