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Bitcoin Gold: What you need to know about Blockchain's next split

Anyone who owns bitcoin will soon be able to receive new cryptocurrency.

Starting from block 491, 407 on the bitcoin blockchain, another version of the protocol will be launched, which will lead to a variant bearing the name of bitcoin gold (BTG).

The project, which aims to improve Bitcoin's technology by changing the way its competition for rewards is conducted, is the second to be launched since August via an increasingly common process called "hard fork".

Readers can recall the term of the Bitcoin Cash launch, the alternative version of the Bitcoin protocol that sparked global headlines for the unexpected creation of billions of dollars worth, seemingly out of the air.

For the future, many industry observers expect the same results this time around, although there may be reasons to temper the enthusiasm.

What is the bitcoin gold?

In short, the bitcoin gold aims to achieve two goals:

  • First, the bitcoin gold wants to change the operation of the operation by making sure that the most powerful mining machines (called ASICs) can no longer be used.
  • Secondly, by attracting more people to this system over time, he hopes to release the bitcoin network of the large companies that offer these products and, in his view, exert undue influence on the network.

Instead of scaling bitcoin to support more users, bitcoin gold bitcoin tweaks in order to "disconnect bitcoin again". According to project proponents, the network, designed to provide an egalitarian way of sending payments digitally worldwide, will be more accessible to users.

And although created by the same mechanism, bitcoin gold differs from bitcoin money in many ways, especially in its distribution.

Differences include:

  • Bitcoin gold cryptocurrency must be created in advance (before the code is open to the public).
  • About 1% of the total cryptocurrency chips extracted before the blockchain becomes public will be used to pay the bitcoin gold development team.
  • Once this distribution is over, the team says that it will launch cryptocurrency so that users can exchange their coins.
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Of course, although it aims to become the de facto version of bitcoin, others might consider the bitcoin gold as an "altcoin" – the term has long been used to designate a cryptocommunication launched with the existing bitcoin code. has an alternative market or a case of use.

Am I having bitcoin gold?

All bitcoin owners will receive cryptocurrency at a rate of 1 BTC at 1 BTG, paving the way for eventual market activity.

But, that does not mean that it's totally intuitive to recover.

A quirk, it is that it will be easier to redeem funds from portfolios or exchanges that recognize cryptocurrency. The easiest way, then, to recover the bitcoin gold is to move bitcoin to a wallet or exchange that supports gold bitcoin, or hold bitcoin in a wallet where you own your private keys (rather than to keep them with an exchange). ]

To date, 20 stock exchanges and portfolios promise to support bitcoin gold once launched, according to the project's website.

Although one of the most popular American stock exchanges, Coinbase said on Oct. 20 that it does not support bitcoin gold because of skepticism as to how the developers put it information on projects available to others.

"At the moment, Coinbase can not support bitcoin gold because its developers have not made the code available to the public for review, which represents a major security risk," can we read in the post.

It may be something to watch as the project progresses. Although the project is officially taking place on Monday night, it is not yet open to everyone, and there is still a lot left on the developers' list of things to do.

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Who is behind the bitcoin gold?

The team behind the hard fork seems to be a relatively small group.

Hong Kong-based LightningAsic CEO Jack Liao, who openly criticizes the state of Bitcoin mining, addressed the idea of ​​gold bitcoin in July.

His LightningAsic business sells mining equipment, including GPUs, the type of computer hardware on which bitcoin gold is supposed to count.

Since being set up earlier this summer, the team has expanded to include the main developer h4x3rotab, as well as a team of five other volunteers who are currently working on developing and developing promoting cryptocurrency in their free time.

The project can be tracked on Github and on the Slack group of the community.

What do people think of bitcoin gold?

All that being said, for those who are interested in exploring or using bitcoin gold, it is worth noting that this has generated its share of controversial.

Satoshi Labs CEO Marek Palatinus, who launched the first-ever Bitcoin Mining Pool, is skeptical that the project will actually decentralize mining as planned.

And it is not the only one to throw some light on this new project.

Bitcoin's developer, Rhett Creighton, is working on alternative bitcoin gold "forklift" software that seeks to pursue the same idea but without setting aside some of the new cryptocurrency for development.

If more than 51 percent of miners choose to use his software, the so-called pre-distribution to developers will be erased, he told CoinDesk. "It's up to the miners to decide what they want," he added.

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Overall, it is not clear whether business groups and mining groups will support the project, and if they do, what value is the alternative blockchain? could create.

For example, while a list of about fifty companies and miners supports the so-called Segwit2x range, similar support has not been observed for gold bitcoin. Similarly, although bitcoin cash started with the support of miners and voice exchanges, gold bitcoin has probably not yet benefited from such early activity.

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which participated in the organization of the Segwit2x agreement.

Bitcoin gold image via Shutterstock

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