Less than a week ago BIP91 became locked-in and we all cheered. The risk of a major split in our beloved Bitcoin had passed. We could all get back to sipping our fine wine and HODLing like crazy. End of story.
Except it isn’t the end of the story. August 1 could still happen (As a Bitcoin-relevant event, that is. As a date it almost certainly will happen), and the Bitcoin blockchain could still be split by a User Activated Hard Fork (UAHF).
As Bitcoinist reported on Saturday, some exchanges have already started trading a new token, Bitcoin Cash, in anticipation of this.
What the Fork?
BIP91 was proposed in May 2017, as the solution to the block-size scaling debate, supported by a significant majority of the Bitcoin industry, in the New York Agreement. It required a minimum of 80% hash-power support to avoid the User Activated Soft Fork (UASF/BIP148) planned by the Bitcoin Core developers for August 1, 2017.
Yes, support hit 80% and we locked-in to BIP91, but that was never by any means guaranteed. So back in April, Bitmain devised the UAHF as a contingency plan, in case the UASF was implemented and looked to pose an imminent risk to the Bitcoin ecosystem.
So We Don’t Need It Now?
No, we don’t need it, but a developer group advocating a larger block size proposed Bitcoin ABC at the Future of Bitcoin conference. This is essentially a development of the UAHF, although no longer controlled or endorsed by Bitmain.
This may, however, still be implemented on August 1, causing a split in the blockchain and creating the new token. This is currently dubbed as Bitcoin Cash (BCC), with the existing blockchain (confusingly also called Bitcoin Core) retaining the Bitcoin branding and BTC acronym… for now.
So What Will I Have in My Wallet?
In your wallet, you’ll still have Bitcoin Core, but you will also be the owner of the same amount of Bitcoin Cash. At the point of the split both blockchains will be identical, so your private keys will access the same balance on the new blockchain too.
You will have to download a BCC client to make transactions in the new token, as your current wallet probably won’t support it. Your current exchange probably won’t support it either, but lists of both exchanges and wallets supporting BCC is published on the website.
Double Money! What’s the Problem?
It isn’t double money, it’s the same amount of two different tokens. The value of each can vary widely. Having said that, there shouldn’t really be a problem.
There is the possibility that investors will see the split as a sign of instability, which could harm the price of both currencies. But most parties seem to favor one token and think the other will just carry on as a minor altcoin.
Coinbase has stated that they will not be listing BCC for trade or allowing withdrawals of the currency. This has led to cries of theft from some users, and the movement of funds by other (more savvy) users.
Bitmain has stated their support for Segwit2x, but don’t rule out the possibility of supporting both coins in the future, depending on how BCC fares.
Chandler Guo tweeted this very erudite message.
$BCC just shitcoin，$BTC still bitcoin pic.twitter.com/qnxhAt9DAP
— Chandler Guo (@ChandlerGuo) July 23, 2017
So it seems like most folks are backing BTC, myself included. But if you’re going to get some BCC for doing nothing then why not? Just shift your BTC out of Coinbase before August 1!
Do you think a UAHF will happen on August 1? Are you stockpiling Bitcoin in anticipation of a possible split and chance for free BCC? Let us know in the comments below.
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