Bitcoin Civil War
Bitcoin and its community are in a red alert zone for the next two months with high tensions and polarization!
Sharply divided in two main fractions, over how bitcoin should move forward, with different solutions for improving Bitcoin chain protocol, the politics surrounding bitcoin are getting uglier and uglier day by day.
There is double trouble with upcoming Bitcoin hard forks, that are technical issues (old blockchain, inefficient, expensive, making trading slow and difficult), and a political struggle within Bitcoin community with Chinese (in better position) and American players battling for dominance over Bitcoin.
Perhaps even this exceptionally bullish trend of Bitcoin, the price rocketing near $6000 and with a total market cap roughly $95 Billion, partly was also the result of the anticipated, highly important events which are the two next Bitcoin hard forks which set of the latest speculative frenzy. At least some of the price rise is likely the anticipation of “free money” in ways of accruing the free split tokens in the upcoming two hard forks!
Most of the members in the Bitcoin community agree about the need to update the old blockchain from 1MB block size to rise at 2MB like a solution to solve the Bitcoins issue of scalability. As we all are experiencing the bottlenecks in Bitcoin daily usage with continuous growing number of transactions, therefore causing longer confirmation times and higher fees for users. So the need for upgrade by introducing a major change is undisputable, but the controversy remain of how and when.
There is a very interesting idea behind the Bitcoin Gold, as there is a fraction including some of the Bitcoin core developers that think Bitcoin was created to be immutable and the main purpose of creation of the Bitcoin as a decentralized currency was to give the masses the power to control and manage their own money and through their own home computers. And this is exactly behind Bitcoin Gold the idea of re-empowering the average person in Bitcoin mining, thus achieving true decentralization. Seeks to remedy this by employing a new proof-of-work mining algorithm which will again enable people to mine bitcoin gold coins on their home computers.
Two upcoming controversial bitcoin hard forks to occur are:
–Bitcoin Gold, expected hard fork to occur on October 25
– Segwit2x, maybe, Bitcoin Diamond!? Expected on November 18.
Usually as a by-product of a contentious hard fork is the creation of a new coin, in this case not one but two all new coins: Bitcoin Gold and Bitcoin 2x or better yet, Bitcoin Diamond!
There is quite a possibility that after two months on the cryptocurrency these coins will compete: Bitcoin, Bitcoin Cash, Bitcoin Gold, Bitcoin Diamond! Deja Vu, what an interesting situation. A very fertile ground for speculators and some brave traders, but hard on ordinary folks.
It’s very important to see how many of the miners will support the new versions of Bitcoin and how many will stick to the old version. In reality the end users will ultimately determine in which direction things will head.
This increased block size from 1MB to 2MB was proposed as a scalability solution to allow for more transactions to be processed, thereby alleviating the bottleneck and reducing transaction fees.
But right now, Bitcoin’s network is mostly powered by powerful chinese miners who employ special hardware called ASICs to mine new bitcoins. So they have greater influence over the Bitcoin’s network. However, Segwit2x supporters point to the fact that about 90% of miners are signalling approval for a protocol upgrade through the hard fork.
We could see short term volatility in Bitcoin in the next several months, but the long-term view is very optimistic. The future of currency is digital there is no doubt.
True Bitcoin value is just like the diamond, scarce, with few colors, but unfortunately you cannot make jewellery and wear it.