Bitcoin Developer Plans Fork Named "eCash," Sparking Brand Clash and Coin Reassignment Backlash
Paul Sztorc's LayerTwo Labs is targeting August 2026 for a Bitcoin hard fork that would create a new chain called eCash, complete with a sidechain architecture that never made it into Bitcoin proper. A plan to redirect hundreds of thousands of coins tied to Satoshi Nakamoto drew swift condemnation and has since been partially revised, though the final structure remained unsettled as of publication.
Paul Sztorc, CEO of LayerTwo Labs, announced plans to fork Bitcoin at block height 964,000, expected to arrive in August 2026. The resulting chain will be named eCash, a direct reference to David Chaum's 1990s digital cash protocol.
Existing BTC holders would receive an equivalent balance of the new tokens at the moment of the split. Anyone holding 4.19 BTC, for example, would also hold 4.19 of the new eCash tokens, with a coin-splitter tool allowing users to manage each asset separately afterward.
The announcement landed on two controversies at once. First, an eCash token already exists. The XEC token, a 2021 rebrand of Bitcoin Cash ABC (BCHA), led by developer Amaury Séchet, currently trades at roughly $0.000007, with a market capitalisation near $140 million and a 24-hour volume of $3.39 million as of April 27, 2026.
It sits at rank 228 on CoinGecko, more than 98 percent below its all-time high. The existing eCash project has an active development ecosystem, including Avalanche Pre-Consensus integration and live Lightning-layer implementations through Cashu and Fedi, giving the naming conflict practical weight beyond brand recognition alone.
Second, and far more contentious, was Sztorc's original plan to redirect approximately 500,000 of the roughly 1.1 million Bitcoin associated with the "Patoshi pattern," the cluster of early-mined coins widely attributed to Satoshi Nakamoto.
Under that proposal, those coins would have been reassigned to accredited investors as a pre-launch funding mechanism, with around 600,000 Satoshi-linked coins left untouched. Sztorc acknowledged the move would "no doubt" be controversial but called it "necessary, and in fact, ideal."
He has since posted a revised version of the plan that removes the Satoshi coin component, though the final structure remains unsettled as of publication.
The backlash was immediate and largely one-sided. Analysis of responses to Sztorc's announcement on X showed roughly 80 to 85 percent of top replies expressing opposition. Bitcoin podcaster Peter McCormack called the original plan "theft and disrespectful," adding that "eCash is already used for Lightning payments with Cashu and Fedi," an observation that underscored the active ecosystem standing behind the contested name.
Josh Ellithorpe, CTO of Pixelated Ink, warned that once a fork establishes the principle that dormant balances can be redistributed, "it could be anyone later," not just Satoshi.
Casa Chief Security Officer Jameson Lopp offered a more measured view, noting that any such reassignment "could only happen on Bitcoin itself if the broader network of developers agreed to adopt the fork," and dismissed the intensity of the reaction as "clever outrage marketing."
As of now, no major miners, exchanges, or ecosystem participants have announced support for the fork.
The project carries considerable technical ambition, even if its reception has been cold.
Sztorc has been developing the Drivechain concept since 2015, formally submitting it to the Bitcoin community as BIP300 in 2017 and BIP301 in 2019.
The architecture enables merged-mined sidechains on top of Bitcoin, meaning miners can secure additional chains without dedicating separate mining hardware, though additional node infrastructure is required for each sidechain.
Seven sidechains are in active development for the new eCash chain, including a Zcash-modelled privacy layer, a decentralised prediction market called Truthcoin, a decentralised exchange called CoinShift, and a quantum-resistant chain called Photon.
Critics argue that the Drivechain model gives miners too much authority, raising the risk that a coordinated majority could drain sidechain funds.
Sztorc frames the fork itself as a pressure tactic: he stated the project "could be halted if Bitcoin Core finally activates BIP 300/301," positioning eCash as a governance lever rather than simply an alternative chain. He has also characterised the Bitcoin development process as suffering from "governance gridlock," a framing that explains why he chose to pursue an independent fork rather than continue waiting for protocol-level approval.
For users outside the United States, the implications extend well beyond technical debates. India ranks first in the 2026 Global Crypto Adoption Index and Nigeria ranks second. Pakistan ranks eighth, a notably high placement, and Ethiopia, Kenya, and Ghana all place in the top 20.
Sub-Saharan Africa recorded more than 180 percent year-on-year growth in stablecoin adoption, driven primarily by remittances and merchant payments in economies with limited banking access or chronic currency instability.
In those contexts, Bitcoin's value is inseparable from its perceived reliability as property. Critics warn that a proposal framing dormant wallets as a funding pool, even on a separate fork with no mainnet effect, may give authoritarian governments and hostile regulators a rhetorical foothold to justify broader intervention in user holdings.
The naming clash adds a more immediate retail risk: markets where crypto literacy is growing but financial infrastructure is still thin are especially vulnerable to confusion between two assets sharing a name. Some analysts have pointed to the Bitcoin Cash and Bitcoin SV split of 2018 as a parallel case in which competing fork identities created conditions for retail losses, though no primary study has formally quantified that dynamic.
In South Africa, where the revenue authority treats crypto as a taxable asset, receipt of new fork tokens may also constitute a taxable event, with capital gains rates reaching 18 percent and income tax rates up to 45 percent for active traders. Other African jurisdictions, including Nigeria, Kenya, and Ghana, currently lack equivalent regulatory clarity on hard fork receipts, leaving users in those markets without formal guidance.
LayerTwo Labs has raised $3 million in funding and has been building toward this moment for years. Whether the fork attracts enough miner participation and exchange listings to function as a real network remains the decisive question. Without that support, the chain faces the trajectory of most minor Bitcoin forks: critics, including community commentator PakoVM, have predicted the network would fade within two to three years, following the familiar pattern of a brief spike of speculative interest giving way to irrelevance.
Sztorc has until August to settle on a funding model that can stand without the Satoshi coins, and to demonstrate that the Drivechain thesis has enough backers to give the new network a meaningful start.