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Gemini Adds Support for Bitcoin Cash Trading and Custody on the ABC Network

Gemini, a major cryptocurrency exchange and custodian, recently announced it launched support for Bitcoin Cash on the ABC blockchain.

Cryptocurrency exchange Gemini announced support for Bitcoin Cash (BCH) custody and trading today with a post on its official Medium blog, Dec. 8. Gemini, which is based in the United States, was founded in 2015 by the Winklevoss brothers.

The exchange pointed out that, at the moment, it will “only be providing support for the Bitcoin ABC network” which is identified on the platform as “Bitcoin Cash with ticker: BCH.”

Gemini declared that they “are continuing to evaluate Bitcoin SV over the coming weeks or months, and we may or may not choose to support withdrawals and/or trading of Bitcoin SV in the future.”

In order to ensure legal compliance, the company, which claims to be the world’s most regulated cryptocurrency exchange and custodian, reportedly “worked closely with the New York State Department of Financial Services (NYSDFS) to obtain approval to offer Bitcoin Cash trading and custody services.”

Bitcoin SV and Bitcoin ABC are the two blockchains that contended for the Bitcoin Cash name after a controversial hard fork. What was often referred to as a “war” in the crypto community ended when Bitcoin SV backer and billionaire entrepreneur Calvin Ayre declared that the chain no longer wants the Bitcoin Cash name, as Cointelegraph reported Nov. 24.

In October, Gemini gained regulatory approval to offer trading of major cryptocurrency Litecoin (LTC). Gemini’s vice president of engineering Eric Winer noted Gemini’s thoroughgoing “banking compliance and fiduciary obligations” under oversight from NYDFS. He stated that Litecoin trading support came as the result of close cooperation with regulators, and that the exchange is approaching new assets with a “security-first” approach.

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Ethereum Constantinople Hard Fork to Come in Mid-January, Based on Dev’s New Agreement

Ethereum core developers have decided to activate the Constantinople upgrade at block 7,080,000.

Ethereum (ETH) core developers have agreed to launch the long-awaited Constantinople  hard fork at block 7,080,000, as decided in a bi-weekly developers meeting on Friday, Dec. 7.

The new agreement follows the previous decision to delay Constantinople fork for late January 2019 due to a “consensus issue” that occurred during the upgrade trial on Ropsten testnet in October.

Given the press-time ETH block time of 14.3 sec, and the number of remaining blocks of around 234,745, the Constantinople upgrade is likely to become active in around 38 days from press time, or around Jan. 14, 2019, according to the data from the Ethereum blockchain explorer Etherscan.

ETH

Ethereum’s last block and blocktime at press time. Source: Etherscan

The upcoming Constantinople hard fork encompassses five separate Ethereum Improvement Proposals (EIPs) in order to soften the transition from proof-of-work (PoW) to more energy efficient proof-of-stake (PoS) consensus algorithm.

Once activated, the upgrade is supposed to fundamentally change the Ethereum blockchain, with the synchronous nodes update to the entire system.

Ethereum is a public, open-sourced blockchain platform featuring smart contracts and its native cryptocurrency Ether. Launched on July 30, 2015, Ethereum is now the third biggest cryptocurrency by market cap at around $9.7 billion and is trading at $94.67 as of press time, according to data from CoinMarketCap.

Recently, Ethereum co-found Vitalik Buterin was granted an honorary doctorate from the Switzerland’s oldest university, the University of Basel, for “outstanding achievements in fields of cryptocurrencies, smart contracts, and the design of institutions.”

In November, analysts from Northeastern University and the University of Maryland claimed that the alleged existing lack of diversity in Ethereum smart contracts threatens the whole Ethereum blockchain ecosystem.

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Bitmain, Roger Ver, Kraken Sued for Alleged Bitcoin Cash Hard Fork Manipulation

Florida-based UnitedCorp has launched a suit against Roger Ver and some other major industry players for allegedly planning a scheme to take control of the BCH network.

Florida-based United American Corp. (UnitedCorp) has purportedly filed a lawsuit against Bitmain, Bitcoin.com, Roger Ver, and the Kraken Bitcoin Exchange, according to a press release published Dec. 6. UnitedCorp alleges that the defendants planned a scheme to take control of the Bitcoin Cash (BCH) network.

Founded in 1992, UnitedCorp is a development and management firm with a focus on telecommunications and information technologies. The company manages a portfolio of patents and proprietary technology in telecoms, social media and blockchain. UnitedCorp also owns and operates BlockchainDomes stations, that provide heat for agricultural applications.

The suit filed in the U.S. District Court for the Southern District of Florida alleges that the defendants jointly used unfair methods and practices to manipulate the BCH network for their benefit and detriment of UnitedCorp and other BCH stakeholders. The release further specifies:

“UnitedCorp believes that the defendants colluded to effectively hijack the Bitcoin Cash network after the November 15, 2018 scheduled software update with the intent of centralizing the network — all in violation of the accepted standards and protocols associated with Bitcoin since its inception.”

On Nov. 15, the BCH network underwent an update, which divided the community into two main camps, those who support Bitcoin Cash ABC and those who support Bitcoin Cash SV. UnitedCorp states that the defendants took control of the coin’s network right after the upgrade using “rented hashing.” This allegedly led to the adoption of Bitcoin ABC rule sets, precluding other implantations from maintaining a democratic rule sets.

UnitedCorp also alleges that on Nov. 20 the Bitcoin ABC development team put a “poison pill” into the blockchain by way of a “Deep Reorg Prevention” in order to strengthen control over the blockchain ledger. That allegedly enables maintenance of control on implementations for future network updates.

The suit seeks injunctive relief against the defendants, asking to prevent them from ongoing actions against the BCH network and doing so in the future. Additionally, UnitedCorp seeks compensation, the value of which it claims will be determined at trial.

Bitcoin Cash has registered the major losses on the day. The altcoin is down by over 20 percent over the last 24 hours and is trading at around $103 at press time, according to CoinMarketCap.

Bitcoin SV (BSV), in turn, has seen noteable daily gains of over 27 percent, and is trading at around $112 at press time. BSV’s maximum supply is 21 million, while its market capitalization is around $1.9 billion at press time.

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Japanese Exchange GMO Coin Set to Resume Bitcoin Cash Trading on ABC’s Chain

GMO Coin, a Japanese exchange, is resuming Bitcoin Cash trading employing ABC’s blockchain.

GMO Coin, a Japanese cryptocurrency exchange, has resumed Bitcoin Cash (BCH) trading with the BCHABC blockchain, Finance Magnates (FM) reports Dec. 3.

The exchange has reportedly “announced that it will be resuming BCH/JPY trading” tomorrow, Dec. 4. The trading had been “temporarily suspended” in an attempt “to avoid the disruption caused” by the recent Nov. 15 hard fork.

Finance Magnates writes that they “reached out to the company to enquire which of the two versions of Bitcoin Cash” the exchange will be listing. The spokesperson is quoted as answering “in our company, the one shown as BCH indicates a Bitcoin Cash called BCHABC.”

As Cointelegraph recently reported, it has been over a week since the Bitcoin Cash blockchain has split in two. BCHABC, the apparent winning faction, is the more “conservative” network, as Cointelegraph explained, which stands against bringing any radical changes to the BCH software.

In the end, the “battle” ended when Calvin Ayre, a supporter of the “losing” faction (BCH SV), called for a “permanent split” after declaring that BCH SV “no longer want[s] the name Bitcoin Cash.”

The same post also claimed that “Bitcoin SV is the original Bitcoin (BTC) not the original Bitcoin Cash” and accused other blockchains of having “tinkered it [Bitcoin] to death.”

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Barry Silbert: Bitcoin Cash Hard Fork Was An Industry “Disservice”

Since the Bitcoin industry entered late-October, there has been an auspicious rise in search queries for the cryptocurrency, in spite of the downtrend that shocked crypto-centric investors worldwide. As reported by Ethereum World News, per Google Trends, the “Bitcoin” query has risen to a four-month volume high. The search term, “Bitcoin Cash,” also saw a notable explosion in volume.

Tom Lee and Mati Greenspan, two industry savants, both commented on this trend, with the former calling the statistic “interesting,” while the latter noted that “we’re back.” And interestingly, mainstream media outlets have picked up on this renewed trend, recently covering the cryptosphere incessantly and through a variety of different mediums.

CNBC, for one, recently began to call upon the executives, analysts, and researchers in the cryptosphere to make appearances on their television segments, which have become fairly infamous for their (sometimes inaccurate) coverage of Bitcoin.

Last week, they brought on Barry Silbert, the man behind crypto-centric conglomerate Digital Currency Group (DCG), to speak on the current state of cryptocurrency affairs and its potential future.

Bitcoin Cash Hard Fork Was An Industry “Disservice” 

Discussing an industry hot topic, Silbert, who owns/manages stakes in this industry’s foremost startups, noted that the Bitcoin Cash debacle, which hasn’t even come to its final head just yet, is a distraction for investors.

Elaborating on this point, clearly indicating that he isn’t a big fan of the fracas, but remains a Bitcoin proponent, the DCG chief noted:

The fork is a distraction. The industry did itself a real disservice, but let me give you the other side of that — if Bitcoin emerges as the winner, it will have been battle-tested, as it has been challenged by competitive cryptocurrencies and internal development strife.

Silbert: Death Of ICOs, Ethereum (ETH) Sell-Off, And Crashing Stocks Prompted The Crash

Drawing the conversation back to this budding industry’s flavor of the month — the dismal market conditions — Silbert did his best to reason why Bitcoin, coupled with its altcoin brethren, underwent a jaw-dropping sell-off that caught investors with their pants down, as it were.

He first explained that crypto’s largest investors are funds/groups with asymmetric risk appetites. Silbert added that these funds often hold positions in high-risk, often-tumultuous technology stocks, coupled with cryptocurrency holdings. So, seeing that lines that can be drawn between the recent sell-offs seen in equities and crypto, it is apparent that the macro market has been proding Bitcoin investors.

The DCG head, one of the crypto industry’s foremost entrepreneurs then drew attention to the ICO market, which has been beaten and bashed by an SEC crackdown recently. Keeping in mind that ICOs primarily catalyzed 2017’s monumental bull run, the fact that “ICO market is completely unwinding” has evidently been a bearish catalyst for crypto assets.

Further speaking on this purposed factor, he explained that as ICO-funded tokens have collapsed, startups have sought to liquidate their war chests, which were primarily filled with Ether to stay financially afloat,

Last but not least, he noted that crypto hedge funds are finally seeing their first redemptions, putting further selling pressure on the cryptocurrency market, presumably through Bitcoin sell orders.

Title Image Courtesy of Marco Verch on Flickr

The post Barry Silbert: Bitcoin Cash Hard Fork Was An Industry “Disservice” appeared first on Ethereum World News.

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Chinese Mining Giant Bitmain Releases ‘Crypto Index’ Tracking Bitcoin, 16 Altcoin Prices

Bitmain has released the Bitmain Crypto Index, designed to give both institutional and retail investors a “transparent” price benchmark.

Chinese cryptocurrency mining giant Bitmain released several price indices Nov. 30, aiming to track the largest assets for both institutional and retail investors.

The Bitmain Crypto Index (BCI) comprises real-time spot price reading which refreshes every second, along with a daily reference price. The spot index covers the 17 largest cryptocurrencies by market cap.

In a methodology overview, Bitmain said the product was “developed to provide institutional and retail investors with a transparent, timely, methodology-based, and investable benchmark of the most active cryptocurrencies traded globally,” explaining:

“The Index is solely owned by Bitmaintech Pte. Ltd. and is administered by Bitmain Index Operating Committee (‘BIOC’) which will conduct regular review and engagement with external stakeholders for feedbacks to keep the Index methodology as updated and representative as possible.”

BCI forms the latest branching out for Bitmain as the company undergoes a significant period in its history.

As the largest Bitcoin mining participant, controversy around both the company and co-founder Jihan Wu has increased in recent weeks due in part to the role of both in the Bitcoin Cash (BCH) contentious hard fork.

Bitmain also reportedly intends to hold an IPO in Hong Kong, but doubts remain as to whether such an event is likely to happen.

Regarding hard forks, the BCI will treat fresh forks of cryptocurrencies covered using a ten-day grace period. The overview states:

“For the purpose of Index calculation and dissemination, a hard forked new token will be measured against a set of criteria on its 10th day post-fork to determine whether it is a ‘significant’ one.”

Other requirements include the coin “trading on at least 2 constituent exchanges” with “at least 200 daily trades in the new token vs. USD or equivalent pairs on all constituent exchanges.”

Earlier this month, a subsidiary of VanEck launched the first cryptocurrency index based on over-the-counter (OTC) rates.

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Bittrex to Delist Bitcoin Gold by Mid-September, Following $18 Million Hack of BTG in May

Crypto exchange Bittrex will delist Bitcoin Gold (BTG), a hard fork of Bitcoin (BTC), by September 14 following an $18 million hack of the BTG network in May, The Next Web reported September 3.

Founded in 2007, the hard fork cryptocurrency Bitcoin Gold has suffered a “double-spending” hacking attack that reportedly allowed the unknown hijackers to take control of more than 51 percent of the BTG hashrate. The attack, which reportedly started on May 18, 2018, has managed to amass more than $18 million in Bitcoin Gold from various exchanges, including Bittrex.

Following the hack, the Bitcoin Gold team explained that the attacker was deploying the combination of a 51 percent and double-spend attack in order to defraud crypto exchanges. They noted that the hacker was targeting exchanges since they “accept large deposits automatically, allow the user to trade into a different coin quickly, and then withdraw automatically.”

Specifically, the attacker was making large BTG deposits on exchanges, at the same time sending the same funds to his own crypto wallet. By the time the exchanges realized that the transaction was invalid, the hacker had already withdrawn funds from the exchange and doubled his original funds.

According to the recent report, Bittrex has not specified the amounts of losses the cryptocurrency exchange has suffered as a result of the BTG attack. However, the major crypto exchange has reportedly requested more than 12,000 BTG (worth around $255,000) as a compensation from Bitcoin Gold.

While Bittrex has blamed BTG’s Proof-of-Work (PoW) consensus as a factor that led to the double-spending attack, Bitcoin Gold claimed that their team “is not responsible for security policy within private entities like Bittrex,” adding that the exchanges “must manage the related risks and are ultimately responsible for their own security. With that, BTG developers acknowledged the risks taken by their own blockchain, subsequently posting an upcoming hard fork upgrade plan.

The $18 million hack is not the first successful attack associated with the Bitcoin Gold cryptocurrency. In late 2017, a fake BTG wallet stole private keys worth $3.3 million in crypto.

At press time, Bitcoin Gold’s market share amounts to $373 million, and the coin is trading at around $21.70 and ranked 30th by market cap, according to CoinMarketCap data.

As for Bittrex, the crypto exchange has recently become one of the entrants to the “Virtual Commodity Association Working Group” — the self-regulatory association for digital commodities like cryptocurrencies. The organization is planning to develop industry standards and to “be a precursor to the formation” of self-regulatory activity for cryptocurrencies.

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Bitcoin Cash Drama: Battle Lines Drawn Ahead of Scheduled Hard Fork

Controversial and untrusted figure in the Bitcoin Cash (BCH) community Cobra Bitcoin may prove to be the saving grace for the network’s future, after a highly contentious dispute between Bitcoin ABC and nChain threatens to split BCH into competing chains ahead of a scheduled hard fork in November.

Cobra, the anonymous owner of Bitcoin.org and previous critic of Bitcoin Cash, announced the Cobra Client hard fork in a Medium post and dubbed the upgrade a “safe implementation of the Bitcoin Cash protocol.” The proposed upgrade is in response to the “mostly non-important and non-urgent changes” proposed by major developers Bitcoin ABC and nChain.

Major developers clash over proposed upgrades

Bitcoin ABC, the biggest Bitcoin Cash client, initiated the stir in the BCH community after it released version 0.18.0 of its full node Bitcoin Cash implementation on August 20, which included major software changes like canonical transaction ordering and two new operation codes (opcodes).

Bitcoin ABC’s proposal came days after nChain, Craig Wright’s Blockchain development firm, announced their own fork of BCH, Bitcoin SV — or Bitcoin Satoshi Vision (SV) on August 16. nChain’s upgrade has seen support from Coingeek, the largest BCH mining pool.

nChain’s Bitcoin SV will increase block size from 32MB to 128MB and reinstate four “Satoshi opcodes” in an effort to restore the original Bitcoin protocol. Wright opposed the addition of new opcodes and other arbitrary changes to the network and stated nChain would revert to version 0.1.0 implementation in order to preserve long-term stability for BCH.

Jihan Wu, Bitmain founder and major supporter of Bitcoin ABC’s initial hard fork of Bitcoin in 2017, weighed in on the debate and dismissed Craig Wright’s baseless opposition to the fork, calling him a “fake Satoshi.”

Ethereum founder Vitalik Buterin also took a strong stance against Wright, saying in a tweet that “the BCH community should NOT compromise with Craig Wright to ‘avoid a split’ and should embrace it as an opportunity to conclusively ostracize and reject him.” Buterin called Craig Wright a “fraud” after hearing him speak at the international Blockchain forum Deconomy in April, alluding to Craig’s claim of being the creator of Bitcoin.

Cobra proposes a compromise to settle the drama

Cobra previously caused outrage in the Bitcoin community after suggesting changes to Satoshi Nakamoto’s white paper and also suggested changes to the original Bitcoin proof-of-work (PoW) consensus algorithm, stating a need for more decentralization.

Now, in an apparent effort to save the reputation and future of Bitcoin cash, Cobra is pushing for a sensible approach to the network’s upgrade to avoid a split. Cobra stated the necessity to avoid interrupting service to users, which will cause irreparable damage to BCH’s reputation and value, and that if there is no consensus, then it is best not to make any changes at all.

Cobra Client is a conservative approach and won’t add any new changes due to the lack of consensus on new opcodes and canonical transaction ordering proposed by Bitcoin ABC. Instead, Cobra’s fork will implement replay protection to prevent BCH transactions from being duplicated across alternate chains, in case of a splintering of BCH — which still has a strong possibility.

Cobra Client solicited support from a broad portion of BCH stakeholders to prove that the upgrade is a viable option for the BCH protocol. Cobra Client claims to have nearly 25 percent of existing BCH hashing power backing the upgrade and that a major exchange will continue the use of the BCH ticker symbol after the changes in November. Cobra Client also addressed the decrease of BCH use in commerce by securing deals with major businesses that have agreed to test the upgrade.

Ideological divisions in BCH community

Bitcoin ABC, who is responsible for the original BTC/BCH hard fork in 2017, and Wright were once in unanimous agreement that Bitcoin Cash was Satoshi Nakamoto’s ‘true vision’ for Bitcoin. But the new updates have caused a schism in the BCH community, with nChain and Coingeek claiming Bitcoin ABC’s recent move is a deviation from Satoshi’s original white paper vision.

Proponents of Bitcoin ABC’s changes argue the new features will make implementing a smart contract framework in the protocol more efficient and improve scalability. Around two-thirds of node operators use Bitcoin ABC, but that could change if a compromise between developers isn’t reached soon.

Wright, who claims to be Satoshi Nakamoto, stated in a recent blog post on Medium:

“Something people fail to understand about Bitcoin is that it is intentionally limited[…] This is purposeful[…] [It] is designed to be stable money and, for that reason, it is not designed to have new opcodes added outside the need for a few security-based replacements or to be altered.”

Still no consensus, answers for the future of BCH

Coingeek is the largest BCH mining pool and supporter of nChain’s proposed changes. The mining poll experienced an increase in its hashrate to 28 percent around the same time of the announcement of Bitcoin SV.

Bitcoin Cash Mining Distribution

Peter Rizun, the chief scientist of Bitcoin Unlimited — a development team accounting for nearly one-third of all full node clients — tweeted his position on the matter, saying Bitcoin ABC should hold off on its plans until more evidence proves its benefits.

The Bitcoin Cash community tuning into the drama is keeping a close eye on mining pools, since miners ultimately cast the vote with their hash power. The conflict within the BTC community represents an ideological schism among developers’ vision for the future of Bitcoin Cash in accordance with the principles set forth in Satoshi’s original white paper.

The Cobra Client upgrade is a safe bet, but Bitcoin ABC and nChain’s fundamentally opposing positions makes a split of BCH seem inevitable.

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Can Crypto Exchanges Be Trusted With Hard Forks?

On July 31, a Chinese Bitcoin investor sued local crypto exchange OKCoin for allegedly blocking him from getting his Bitcoin Cash (BCH) after the Bitcoin fork.  

While the case is new for China, compilations regarding hard forks and exchanges have been amassing since perhaps as early as the DAO incident in 2016. So what happens when you have a coin that is about to be split into two, but you’re holding it on an exchange’s hot wallet?

What’s a hard fork?

Essentially, a hard fork is a change to the cryptocurrency’s protocol that makes previously invalid blocks/transactions valid — and vice versa — and therefore requires all users to upgrade to the latest version. In other words, a hard fork splits the path of the asset’s underlying blockchain, wherein the upgraded, separated blocks start following new sets of rules. Simply put, it’s the equivalent of a ‘reset’ button. There’s also a soft fork, which entails a change of protocol as well, although such forks can still work with older versions.

Why launch a hard fork at all? Basically, it can be initiated to correct security risks found in older versions of the software, to add new functionality or to reverse transactions. The latter, for instance, was the reason for the infamous DAO hard fork, which will be described in greater detail in the next section.

What are hard and soft forks?

According to data obtained from Forkdrop.io, there are currently 116 forks, 74 of which are affiliated with Bitcoin. There are major ones, like Bitcoin Cash (BCH), Ethereum Classic (ETC) or Bitcoin Gold (BGD), that compete with the top coins and are commonly listed on the largest exchanges — they rank 4th, 12th and 24th respectively, as per Coinmarketcap. There are also smaller ones that are worth just a few cents, and are hence less likely to be featured on large platforms. Charlie Lee, the creator of Litecoin who previously worked at Coinbase, described how the platform would approach forks in the past:

“With the ETC and BCH hard forks, it was clear that those two coins will be the minority fork, so it was safe to use a wait-and-see approach. So Coinbase didn’t support those forks initially. And only if there was traction on those forks would Coinbase spend the time and resources to support those forks and let people access their coins on the minority chain.”

The DAO example: To fork or not to fork?

The DAO was set up in April 2016 as a decentralized autonomous organization. Its purpose was to invest in other businesses, making it a form of an investor-directed venture capital fund, powered by smart contracts. The prominent project swiftly gathered a record-breaking $120 million in Ethereum (ETH) during the fundraising stage.

However, in June, some users exploited a vulnerability in the DAO code that allowed them to drain one-third of the DAO’s funds (roughly $50 million) to a subsidiary account. It wasn’t a hack, per se, as the attackers simply found a loophole in the coding — as one of the alleged participants soon declared, he merely used the possibilities of the DAO code.

That lead to a debate in the community, where members effectively took two sides: Some argued that the vulnerability was unfair and their funds should be given back, while others opined that the whole purpose of a smart-contacts-based system is its inviolability and, hence, no manual adjustments should take place. The community voted in favour of the refund (the results can be seen here), and the Ethereum team performed a hard fork. The hacked funds were sent to an account available to the original owners. The token owners were given an exchange rate of 1 ETH to 100 DAO tokens, as per the initial offering conditions.

However, the part of the community that rejected the intervention and favored immutability decided to keep using the unforked version of Ethereum: Ethereum Classic (ETC). ETC held on to the existing Ethereum blockchain and did not implement the hard fork code to ‘undo’ the DAO attack. As the project’s website explained, “Ethereum Classic intends to keep the original censorship-resistant Ethereum going” and “provide an alternative for people who strongly disagree with DAO bailout.”

Therefore, all people who held ETH at that point received the right to claim the equivalent amount of ETC — to do that, they had to access MyEtherWallet and upload their JSON files (which contain the private keys for coins in possession), then claim ETC coins and send them to another address. As can be seen from this example, users can receive chain-split coins as long as they provide the private keys as the proof of their claim.

How do exchanges handle hard forks?

Thus, providing private keys shouldn’t be difficult as long as the coins are stored in a software or hardware wallet that can connect to the coin’s mainnet. However, the situation is different when the forked cryptocurrency is held on a crypto exchange’s hot wallet — in that scenario, the keys are technically held by the platform along with the coins. Consequently, the exchange gets to decide if new coins are going to be distributed among clients or not, and the overall process of claiming those coins gets more complicated.

For instance, when the aforementioned ETC fork occurred, Kraken exchange announced its support and declared that it was crediting client accounts with their ETC balance as long as they had an ETH balance on Kraken at the time of the fork. Similarly, when Bitcoin Diamond (BCD) forked off of the original Bitcoin blockchain in November 2017, Binance was one of the few major exchanges to issue the new coins to BTC holders, while many other exchanges ignored the hard fork entirely.

Therefore, it comes down to the exchanges’ politics when a hard fork nears — although, usually platforms let their clients know beforehand if they are going to support a coin split and reimburse them with new coins. However, some exchanges opt to accommodate most forks by default — for instance, in July, Binance announced that it will endeavor to support airdrops and forked coins conducted by any project, as long as the project team reaches out and contacts the platform directly. Somewhat similarly, in April, Coinbase declared that it will support the withdrawal of Bitcoin forks across Coinbase products (albeit not trading).

In the opposite way, some exchanges choose not to support forks deliberately. Thus, in May, Dutch exchange Bl3p chose to delist BCH prior to its hard fork, citing requirements for altcoins that the coin allegedly failed to meet. The platform warned the clients to withdraw their remaining BCH.

More complications and lawsuits

However, even if the exchange supports a certain hard fork, complications might arise. That was the case with the Chinese investor known under the pseudonym Feng Bin, who recently filed a lawsuit against local crypto exchange OKCoin. Bin claimed that the platform prevented him from getting Bitcoin Cash (BCH) after the BTC fork took place in August 2017.

According to local news agency Legal Weekly, Feng Bin claimed that he couldn’t receive the 38.748 BCH that he was due after the split. In the lawsuit, he explained that he attempted to sell his share of BCH when it reached its all-time high of around $4,000 in December, 2017, only to find “that there was no ‘button’ to extract the [BCH] that the platform promised.”

Following a complaint about the platform’s customer support, OKCoin stated that Feng Bin could not extract any BCH simply because the platform’s program for claiming the forked crypto had expired at that point. The investor, in turn, accused the crypto exchange of failing to provide an official announcement about the deadline for such applications.

While Feng Bin’s case is reportedly a first-of-its-kind in China, a group of five Japanese lawyers have already challenged an unspecified ‘majority’ of local exchanges that have been reportedly failing to deliver on split coins.

“The virtual currency you deposit at an exchange should not belong to the exchange, but to the user,” the lawyers argued, stressing that when exchanges decide not to grant split coins to clients or release them after a delay, they essentially rob them of their profits.

In their announcement, the lawyers recognized that there is no legal framework for handling hard forks, and that seems to be the essential problem in regards to the complex relationship between crypto exchanges and hard forks.

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China: Trader Sues Exchange OKCoin for Failing to Release Bitcoin Cash

A Chinese Bitcoin (BTC) investor has sued local crypto exchange OKCoin for allegedly preventing him from getting Bitcoin Cash (BCH) after the BTC fork, local news agency Legal Weekly reports July 31. The case is reportedly the first legal action in China that involved last year’s fork of Bitcoin.

The investor, known under the pseudonym Feng Bin, filed a lawsuit against OKCoin, accusing the exchange of blocking him from receiving 38.748 BCH that he was due after Bitcoin’s hard fork in August 2017.

In the lawsuit, Feng Bin states that he attempted to sell the Bitcoin Cash when the digital currency reached its all-time high of around $4,000 in December, 2017. However, when the investor tried to withdraw the BCH after the fork, he reportedly “found that there was no ‘button’ to extract the [BCH] that the platform promised.”

Following a complaint to the platform’s customer support, OKCoin stated that Feng Bin could not extract any Bitcoin Cash because the platform’s program for claiming the forked crypto has expired. The investor in turn claimed that the crypto exchange had not made an official announcement about the deadline for claiming Bitcoin Cash:

“I have been paying attention to the announcement of the OKcoin currency release. In all the announcements, there is no declaration of the deadline for receipt and the removal of the program.”

OKCoin has reportedly challenged Feng Bin’s claim, citing inconsistencies between his story and the records of his account balances.

Bitcoin Cash is one well-known example of a hard fork, which is a permanent split in a blockchain protocol, wherein nodes running in the previous version will no longer be accepted in the new version.

Bitcoin forked on August 1, 2017, leading to the presence of two completely different digital currencies, while users who held Bitcoin prior to the fork received an equal number of Bitcoin Cash. BCH celebrated its “first birthday” earlier last week.

Bitcoin Cash has been the subject of some controversy throughout the year. Roger Ver, one of the biggest promoters of BCH claimed that Bitcoin Cash is the “real Bitcoin” in November 2017. Ver said that BCH will “have the bigger market cap, trade volume and user base in the future.”