There’s another fork in the road coming up. Initially, Bitcoin forked into Bitcoin Core and Bitcoin Cash, two distinct currencies. This came as a result of fears from an overwhelming majority of miners that the old system of 1MB benefitted those who prioritized Bitcoin’s investment potential rather than as a secure, anonymous transactional currency. There were a lot of fears that this hard split between Core and Cash could devalue Bitcoin as a whole. While the market has been recovering from those fears, there’s another panic rising over another upcoming fork, the creation of Bitcoin Gold.
Where it came from
Forks happen often in the world of Bitcoin, but understanding their origins is an important choice for users to decide which side of the fence they’re going to sit on. The fork is primarily created by Jack Liao and lead developer H4x4, but has seen support from its inception by NO2x, a group of Core supporters, primarily due to the current system’s centralization with the majority of Bitcoins finding their way to the hands of a small group of miners. These miners use more powerful, expensive ASIC computers to gain a near monopoly of Bitcoin’s mining power. Bitcoin Gold is primarily an answer to the ASIC problem, using new security algorithms that will effectively shut down ASICs, putting miners on a more even playing field and decentralizing the currency.
Many libertarian-minded Bitcoin users will rejoice at the thought of a decentralized system. However, it’s not without its own risks. For one, the system has gone largely untested by miners, so it’s a hard fork in true nature, with no-one knowing quite how effective it will be except for the team working on it. There’s also no sign of an Emergency Difficulty Adjustment, meaning that per-block difficulty adjustment will be roughly the same as Core, meaning there’s still potential for a dedicated group of miners to find other ways around difficulty exploits beyond ASIC computers.
Moving to Bitcoin Gold
If you’re on Bitcoin Core, using the block that Bitcoin Gold chooses, then you’re going to receive the same amount of BTG as you have in BTC. From there, it’s a matter of watching the value movements of those coins. If they’re worth much less than BTC, there’s no danger in holding onto them. However, if they prove to have some worth, you can either choose to stay with the new system or sell them to increase your stash of Bitcoin.
The fork is here
There’s no need for Bitcoin users to fear this hard fork and no reason for the same kind of hysteria we saw with the first hard fork to Bitcoin Cash. It’s not going to affect the BTC core network in any way since they’re not increasing Bitcoin’s supply, but simply moving part of it to offer a little more decentralization.