Tag: hard fork

Bitcoin Gold Hardfork

What is Bitcoin Gold?

Posted on | by [email protected]

Another Hardfork is on the Horizon

On August 1, 2017 Bitcoin split into two coins in a hardfork that created Bitcoin and Bitcoin Cash, as new creators sought to take on the problem of scalability and transaction times. Once Bitcoin Cash launched, many in the crypto community considered all issues of Bitcoin’s design resolved. But now a third coin called Bitcoin Gold is on the cusp of release and it has the Bitcoin community divided. On October 25, Bitcoin Gold will launch with exchanges opening on November 1.

Here’s why a third coin is being created and the potential pros and cons of Bitcoin Gold.

Bitcoin Gold is Decentralizing Mining – Giving Power Back to the Community

Bitcoin Cash took on the issue of scalability by increasing block sizes to 8 MB. The original Bitcoin could only process one transaction every seven seconds, however Bitcoin Cash can process approximately two million transactions per day. Although Bitcoin Cash and Bitcoin have an equal hash rate, the protocol BCH uses allows for more transactions per second, which means faster payments and a lower cost.

For most of the Bitcoin community, the creation of Bitcoin Cash and use of SegWit2x on the original Bitcoin solved all design issues and ended the need for hardforks. However, a small faction created their own rebellion and continued the hardfork movement with Bitcoin Gold.

Bitcoin Gold seeks to release improved protocol that will challenge Bitcoin and Bitcoin Cash. The idea behind this new coin’s design is to create a truly decentralized Bitcoin. It will do so by allowing Bitcoins to be mined on graphics cards, essentially taking away the mining monopoly that mining firms like Bitmain currently have. Bitcoin is not truly decentralized if corporations control the mining process. Bitcoin Gold seeks to change that by mitigating the big players and giving more power to the community.

Pros of Bitcoin Gold

  • Implement “proof of work” algorithm which is optimized for GPU mining
  • No single mining firm can unduly influence the network
  • GPU mining will allow smaller players to mine coins and have influence

Cons of Bitcoin Gold

  • Bitcoin Cash only has 12% of market, Bitcoin Gold could be equally small and thus its purpose and influence might not be met
  • Details of the hard fork, like exact block height, are still undecided
  • This hard fork had further divided the Bitcoin community

It is yet to be determined if the Bitcoin Gold will be the last of the hard forks, some experts have predicted that more will follow. The concept behind the Bitcoin Gold hard fork seems to hold truer to the original concept behind Bitcoin itself, e.g. decentralization. The question remains as to whether this new coin will take off and if it could be a threat to Bitcoin and Bitcoin Cash.

[mk_mini_callout title=”Free Download” button_text=”Get the Ultimate Investor’s Guide to Bitcoin IRAs” button_url=”/resources/investor-guide”][/mk_mini_callout]

How Bitcoin exchanges are planning to tackle the Bitcoin Hard Fork

Posted on | by [email protected]

With the Bitcoin markets fixated on slowly making the switch to bigger blocksize, speculation has taken over the Bitcoin market prices. The number of outstanding transactions to be processed on the Bitcoin Network has been piling up due to the limit on the Blocksize of the Bitcoin network. With piling transactions, there has been a delay in the validation of the exchange. This has defeated the unique selling point of the cryptocurrency and the Bitcoin community has concentrated their efforts towards tackling the problem. Let’s dive deep into how proposed alternative for Bitcoin fork will be impacting the exchanges and how they plan to handle the ordeal of fork in the days to come:

Speeding up transactions:

shutterstock_174029489

The Bitcoin community has resolved to speed up the transaction by increasing the block size in which the transactions are produced and  stored  per every ten minutes. This would mean by proposed terms the blocksize would increase from 2 M.B to 8 M.B being able to process more transactions per 10 minutes and thereby delivering on the transaction speed. These bigger blocks would be on the blockchain labelled as Bitcoin Unlimited and already 11% of the nodes are running on Bitcoin Unlimited. But this would mean exchanges also have to shift to the agreed upon currency depending on the final decision.

Exchange’s plan:

According to the statement released by a group of 20 exchanges, their plan for tackling the hard forking would be to list Bitcoin Unlimited as a separate currency. Since the digital currency would be splitting up into two currencies, Bitcoin Core and Bitcoin Unlimited would be the two blockchains on which the currency would be splitting up depending on the Block sizes. Bitcoin Unlimited would now be listed as an alternative cryptocurrency under the BTU or XBU tickers in the event of a network split.

The exchanges said:

“As exchanges, we have a responsibility to maintain orderly markets that trade continuously 24/7/365. It is incumbent upon us to support a coherent, orderly and industry-wide approach to preparing for and responding to a contentious hard fork. In the case of a bitcoin hard fork, we cannot suspend operations and wait for a winner to emerge.”

Why it becomes necessary:

shutterstock_603872579

The statement signed by Bitfinex, Bitstamp, BTCC, Bitso, Bitsquare, Bitonic, Bitbank, Coinfloor, Coincheck, itBit, QuadrigaCX, Bitt, Bittrex, Kraken, Ripio, ShapeShift, The Rock Trading and Zaif – the exchanges, clearly stated that the exchanges would be listing BU since the fork seems inevitable. The exchanges feel that with the advantages and integrity of the cryptocurrency being questioned, this would indeed be the right move to give the users of the company best service.

Let us help you get started with BitcoinIRA, click to get started.