The Most Promising Bitcoin Hard Forks (And How to Claim Them)

The Most Promising Bitcoin Hard Forks (And How to Claim Them)

by | Feb 7, 2022 | Bitcoin

Did you know that you can claim Bitcoin hard forks coin if you owned Bitcoin at the moment of the fork?

Bitcoin, the first and most popular cryptocurrency ever created, has not been free from conflicts within the community. Over the years, many individuals and groups of developers have come up with ideas to make Bitcoin even better. 

But most of these suggestions ended up dividing the community. That’s why over 100 Bitcoin hard forks have taken place since Bitcoin’s creation in 2009. Here’re the top BTC hard forks and how to claim them. 

A Short History of Bitcoin

On October 31, 2008, a whitepaper was published that described the concept of Bitcoin ━ a trustless peer-to-peer system for digital currency to replace traditional money. The paper was published under the name of Satoshi Nakamoto, but the author’s identity remains a mystery to this day. Many believe that the name is a pseudonym of one or a team of developers. 

On January 3, 2009, the genesis block (block 0) was mined on the Bitcoin network, and the miner, the unknown Satoshi, was rewarded with 50 bitcoins.

From that point on, Bitcoin (BTC) was mined by other early contributors up to 2010. Laszlo Hanyecz, a programmer, made the first commercial transaction using cryptocurrency by purchasing two Papa John’s Pizzas for 10,000 BTC. 

Bitcoin has been traded many millions of times since then. The first major transactions were made in black markets. The largest was the Silk Road, an online black marketplace, which traded close to 10 million Bitcoin during its lifetime.

As Bitcoin grew more as a currency on different markets, regulations emerged from many countries. For instance, the People’s Bank of China (PBC) made the news headlines when they adopted these three separate actions and issued new regulations regarding cryptocurrencies.

  • December 2013. The PBC banned financial institutions from using Bitcoin.
  • September 2017. The PBC issued a total ban on Bitcoin use.
  • June 2021. PBC implemented a crackdown against major cryptocurrency miners.

The price of Bitcoin fell by half after each of these events. However, it always found a way to rise again to new astonishing values. This is because many countries and institutions allow cryptocurrency use. Also, as of September 7, 2021, El Salvador became the first country in the world to adopt Bitcoin as legal tender.

Another aspect of what makes Bitcoin increase in price is the maximum supply. There can only be 21 million BTC. As more investors join the cryptocurrency market, the coin experiences scarcity and the Bitcoin (BTC) price surges as with any supply and demand market. 

Additionally, Bitcoin is more transferable and divisible than gold or another material asset and can be stored more easily. It will cost you a lot to transport gold, as well as the cost of storage in secure facilities. However, investors can store Bitcoin on a USB stick, also known as a cold wallet or hardware wallet.

As Bitcoin gained more popularity, it inspired other developers to create other blockchain platforms, and subsequently, some created Bitcoin hard forks. 

What is a Bitcoin fork?

Many of the cryptocurrencies that exist today use part of Satoshi’s technology. However, many others adapted the Bitcoin blockchain model or tried to improve it.

As more users joined the blockchain, it became increasingly difficult to update the network as no single person or group could decide on unanimous future development.     

To modify the Bitcoin blockchain, all miners must agree on the new rules and what constitutes a valid block on the chain. To change the rules, you must “fork” it to change to indicate that something has changed from the original protocol. These situations are called Bitcoin forking. 

Usually, forks are used to add new features or change some blockchain parameters. The forking process results in the blockchain being divided into two distinct blockchains after a certain point in time. Although there have been many forks since the inception of Bitcoin, only a few are viable projects.

Crypto forks can be either soft or hard forks. The main difference is that soft forks are not a fork that results in a new currency and new branches of the blockchain. Soft forks slightly modify the Bitcoin protocol, but the core Bitcoin blockchain remains the same. Soft forks are backwards compatible, which means that the upgraded chain can successfully share and use data from earlier network versions.

However, during a hard fork, the programming code of the Bitcoin blockchain and its mining processes are upgraded. Once a user has updated their software, it rejects transactions from any older version, creating a new branch to the blockchain. Users who keep the older software can still process transactions. This means that transactions are being processed on two separate chains, and two different currencies result from the hard fork.

This is how various digital currencies, similar names to Bitcoin, have been created. These include Bitcoin Cash and Bitcoin Gold.

While not many investors know, anyone who owns Bitcoin, during a hard fork, is entitled to the new cryptocurrency. That’s why some consider that there’s an obvious financial incentive to fork Bitcoin’s blockchain and made some investors sceptical of the necessity of these forks.

Since it can be confusing for casual investors to distinguish between these cryptocurrencies, we’ll be going through the top Bitcoin hard forks.

Bitcoin Forks History 

Bitcoin has over 100 forks, but not all projects were further developed, and only a few remain functional today. You can find the complete list of Bitcoin forks on forkdrop.io. We’ll mention the most noteworthy Bitcoin forks here. 

Bitcoin XT

Bitcoin XT fork took place on December 27, 2014.

Bitcoin XT is the first known Bitcoin hard fork. Mike Hearn incorporated some of his ideas into the Bitcoin blockchain and launched Bitcoin XT in late 2014. It is said that Hearn is one of the few to have contacted Satoshi Nakamoto via email. 

Bitcoin XT was designed to allow 24 transactions per second. The previous version of Bitcoin could only handle seven transactions per second. It proposed to increase the block size from 1 megabyte to 8 megabytes.

Initially, Bitcoin XT was a success. In 2015, it had more than 1,000 nodes running the software. But, just a few short months later, investors lost interest, and the project was abandoned. Bitcoin XT has been removed from the internet, and its website is not functional anymore.

Bitcoin Classic (BXC)

Bitcoin Classic fork took place in early 2016.

Jonathan Toomim launched Bitcoin Classic in early 2016 as some community members wanted to see block sizes increase after Bitcoin XT’s decline.  

Bitcoin Classic, like Bitcoin XT, saw a lot of initial interest. In 2016, there were approximately 2,000 nodes in use. The Bitcoin Classic (BXC) fork proposed a smaller block size of 2 MB. 

The BXC coin still exists, but it seems that the community has moved on. The website is no longer live. 

Bitcoin Unlimited 

Bitcoin Unlimited (BU) fork took place on March 11, 2016.

Bitcoin Unlimited has remained a mystery since its initial release in 2016. 

Bitcoin Unlimited is unique because it allows miners to choose the size of their blocks. Nodes and miners can limit the number of blocks they accept up to 16 megabytes. The community behind Bitcoin Unlimited believes in market-driven decision making, emergent consensus, and giving their users choices.

Despite some initial interest, Bitcoin Unlimited has not been widely accepted. Only a few nodes are still online. 

Bitcoin Cash (BCH)

Bitcoin Cash fork took place on August 1st 2017 (BTC block 478,558).

Pieter Wuille, a Bitcoin Core developer, presented the idea for Segregated Witness (SegWit) in late 2015. SegWit is a project that aims to decrease the size of Bitcoin transactions, thus allowing for more transactions to occur simultaneously. Technically, SegWit is a soft fork. 

In response to SegWit, some Bitcoin developers and users decided to initiate a hard fork to avoid the protocol updates it brought about. Bitcoin Cash was the result of this hard fork. It split off from the main blockchain in August 2017, when Bitcoin Cash wallets rejected Bitcoin transactions and blocks.

Bitcoin Cash allows blocks of eight megabytes and does not accept the SegWit protocol.

Bitcoin Cash remains the most successful Bitcoin hard fork, and it is backed by many in the cryptocurrency community. BCH can be traded on popular exchanges (Binance, Coinbase, Huobi, Gate.io).

BitCore (BTX)

BitCore (BTX) fork took place on April 24, 2017.

BitCore is an unspent transaction output (UTXO) fork of Bitcoin, and it was launched in 2017. BitCore used Bitcoin’s source code to create a new blockchain but updated the core to make the blockchain size smaller (which makes the network easier to scale). BitCore uses the MEGABTX consensus algorithm, which is ASIC-resistant.

Because anyone can become a BitCore miner, it is impossible to centralise mining power. BitCore also has a 10 MB Segwit-enabled block that allows it to handle 17.6 billion transactions per annum or 48 million transactions per hour.

The entire crypto community can mine BTX using PoW and Masternodes.

Bitcoin Gold (BTG)

Bitcoin Gold fork took place on October 23rd 2017 (BTC block 491,407).

Bitcoin Gold is a hard fork that occurred shortly after Bitcoin Cash. The creators implemented this hard fork to restore mining functionality using basic graphics processing unit (GPU) because they felt mining had become too specialised.

The Bitcoin Gold hard fork featured a pre-mining of the Bitcoin Gold crypto. Pre-mining is when the development team creates the coin from the start. In this case, the Bitcoin Gold developers pre-mined 100,000 BTG. Developers said that these pre-mined coins will be used to grow the Bitcoin Gold ecosystem and pay developers.

Bitcoin Diamond (BCD)

Bitcoin Diamond (BCD) fork took place on November 24, 2017 (BTC block 495.966).

Bitcoin Diamond is a fork of the original Bitcoin blockchain. Bitcoin Diamond was created only two weeks after the Bitcoin Gold fork.

The BCD’s code allows for 100 transactions per second, increasing the block size to 8 megabytes, thus making it more efficient than Bitcoin. While this is an improvement, considering Bitcoin’s seven transactions per second, other cryptocurrencies have much greater transaction throughput, and that’s why some consider Bitcoin Diamond obsolete.

However, the first major Bitcoin hard fork, Bitcoin Cash, can process 116 transactions per second through its increased block size. Although these cryptocurrencies may not be the same, Bitcoin Cash and Bitcoin Diamond are very similar. Some investors wonder if Bitcoin Diamond was a necessary hard fork.

Bitcoin SV (BSV)

Bitcoin SV hard fork took place on November 15th 2018 (BCH block 556,766). It is a fork from the Bitcoin Cash blockchain.

Bitcoin SV‘s goal is to realise the original vision and design of Bitcoin as described in Satoshi Nakamoto’s whitepaper. 

BSV is designed to provide stability and scalability while keeping Bitcoin a peer-to-peer electronic money system. It also aims to become a distributed data network that can support enterprise-level advanced blockchain applications.

It has also removed artificial block sizes limits, re-enabled script commands, and other technical capabilities that had been previously disabled or restricted by protocol developers on the BTC blockchain. The network can process thousands of transactions per second while keeping transaction fees low for micropayments. It also offers advanced capabilities like tokens, smart contracts and other use cases.

The block size of Bitcoin SV can go up to 2Gb and can process over 10,000 transactions per second. BSV reached over 50.000 TPS on the testnet.   

BSV is unmatched in its ability to scale on-chain without any restrictions while being closer to the original Bitcoin design than any other blockchain.

Bitcoin Cash ABC (eCash)

Bitcoin Cash ABC fork took place on November 15, 2020 (BCH block 661648).

Bitcoin Cash ABC (BCHA) is a cryptocurrency that was created in 2020 as a result of a hard fork within the Bitcoin Cash blockchain. This split the original chain into two new ones called “Bitcoin Cash ABC” and “Bitcoin Cash Node.” 

Amaury Sechet is the leader of the Bitcoin Cash ABC developers. They proposed an update to the Bitcoin Cash network. This update included a controversial new “Coinbase Rule,” requiring 8% of all mined Bitcoin Cash to be distributed to BCH ABC to finance protocol development.

Another group, Bitcoin Cash Node from the Bitcoin Cash community, opposed the upgrade. They removed the so-called “miner tax” from their source code.

In July 2021, Bitcoin Cash ABC (BCHA) was rebranded as eCash (XEC). With this relaunch, the team also announced their plans to integrate the proof-of-stake consensus layer Avalanche, which introduces great improvements to the network.  

Three main improvements are:

  • Scaling transaction throughput to more than 5,000,000 transactions per second
  • Improve the payment experience by reducing transaction finality
  • Protocol extension and fork-free upgrades

The eCash (XEC) rebrand also decreases the coin’s decimal from eight to only two.

Beware of Bitcoin Forks Scams

You should also bear in mind that some Bitcoin forks were created as a scam. Bitcoin Platinum, for instance, was created to lower Bitcoin’s value. Other scams, such as the fake Bitcoin Gold wallet, were created to steal your real funds. That’s why it’s crucial to keep your crypto funds safe and don’t trust everyone you talk to over the internet. 

At the same time, you should be aware that some developers just want to make quick money. While some Bitcoin forks seem to be similar, the primary reason for their creation is more marketing buzz. Many developers are looking for free coins, and Bitcoin forks have become the new ICOs. The team creates the fork only to sell the coins on crypto exchanges as soon as it starts trading.

To reduce your chances of losing any Bitcoin, you have to move your Bitcoin to a new wallet before claiming any coins. 

How to safely claim coins from a fork

Before attempting to claim any Bitcoin fork coins, you should research the new project and the team of developers behind it to establish its legitimacy. They should also provide a clear and accurate roadmap for the project they want to build. 

For instance, a Bitcoin fork coin should implement replay protection, to allow the new network to separate from its original. 

Depending on the specific Bitcoin fork, you might need to perform certain risk actions such as exposing your Bitcoin wallet private keys, installing specific software or validating your identity on centralised crypto exchanges. 

One of the easiest ways to claim Bitcoin fork coins is to use wallets that support them. Note that most wallets don’t support many of the Bitcoin forks simply because the process requires complicated technical developments, which is not feasible for most wallets. This is because most of the Bitcoin forks don’t have a great market value and lack a development team and community. 

Bitcoin forks can have various aspects to consider:

  • Coin ratio. Depending on the Bitcoin fork, the new coins (forked-coins) can be claimed at a specific ratio (It’s mostly a 1:1 ratio, but it can vary).
  • Fork height. The Bitcoin block height at the time that the Bitcoin Fork took place. Bitcoin wallets that received BTC after that date are not eligible for the Bitcoin fork claim.
  • Crypto exchange availability. Minor and less successful Bitcoin fork coins will not be supported by a lot of crypto exchanges. 

Before attempting to claim any Bitcoin fork coins, you should go through these simple (but effective against theft) steps.

Step 1. Move Bitcoin to a new wallet

For all Bitcoin fork claims and any forks in general, users need to provide the wallet’s private keys in which the Bitcoin was held at the time of the Bitcoin fork. You should never share the keys of an active wallet. 

That’s why, for safety reasons, moving the crypto funds to a different crypto wallet should be performed first before revealing the private keys to any third party. By doing this, you eliminate any possibility of having your Bitcoin stolen. 

If you still have a Legacy Bitcoin wallet with addresses beginning with 1, claiming these forks can be a great motivation to move your coins to a SegWit account. This will lower your transaction fees and allow you to use Lightning Network.

Step 2. Export private keys

Firstly, you will need to export your private key from the wallet that was used to hold the Bitcoin funds at the time of the fork. Most wallets are able to export a file containing all the addresses and private keys. However, hardware wallets don’t allow private keys export, and for such cases, you need to enter the seed phrase into specific claiming software. 

Using the seed phrase, you can also use open-source tools such as BIT39 to find a wallet’s pirate keys. 

You can import only private keys that have funds to save time. 

Step 3. Check Bitcoin wallet address for available claims

Using your Bitcoin wallet address, you can check if your address is entitled to a Bitcoin fork claim on Findmycoins.ninja.

You should save all the claimable wallets’ addresses and private key combinations. 

The Most Promising Bitcoin Hard Forks (And How to Claim Them)

All valid addresses and private key combinations should be recorded in a spreadsheet or text file that allows you to copy, paste, or replace text. The recording format should include a private key followed by the address. 

Each entry should be numbered and the amount of Bitcoin they contain at the time of the first fork. It will be helpful to number each key pair for ordering purposes. It may be useful to note the sizes. You can, for example, use the address with the smaller amount to test the process.

Step 4. Claim the Bitcoin fork coin using a crypto wallet

There are several secure crypto wallets that can help you claim some of the most popular Bitcoin forks, such as:

  • Coinomi. Supports Bitcoin Cash (BCH), Bitcoin Gold, Bitcoin SV (BSV). Find the guide on how to claim Bitcoin forks on their support page.
  • Exodus. Supports Bitcoin Cash, Bitcoin Gold, and Bitcoin SV.
  • BitPie & Bither wallets. These are two distinct mobile app Bitcoin wallets. BitPie is used to claim the coins, and then Bither can be used to sell them. Using the two wallets you can successfully claim Super Bitcoin (SBTC), BTW, BCD, BTF, BTP, BTN, Bitcoin Cash and Bitcoin Gold.

While the BitPie and Bither wallets are the most common solution you can find on the web these days to claim your Bitcoin forks, the wallets do not support BTC fork claiming anymore. We tried this option without any success. 

How to use Coinomi for Bitcoin fork claims

Step 1. Install and create a Coinomi wallet

Firstly, make sure you have the latest version of Coinomi on your mobile device. Afterwards, create a new wallet, and make sure to write down its seed phrase to recover your funds later, in case something happens to the mobile device. You will also be asked to set up a password for this specific wallet and device. 

Step 2. Select the coins you want to add

Before claiming the Bitcoin forks in the Coinomi wallet, you need to select the specific coins as balances in your Coinomi wallet. 

Click on the bottom-right plus sign and select Add coins. Select the Bitcoin forks you will be adding (e.g. Bitcoin Cash (BCH), Bitcoin Gold (BTG), BitcoinSV (BSV)). 

Step 3. Claim Bitcoin fork coins

Select the coin you want to claim the Bitcoin fork for, and within that specific wallet, click on the top menu > Sweep wallet. 

  • how to claim bitcoin forks coins
  • how to claim bitcoin forks coins
  • how to claim bitcoin forks coins

You will have to paste or scan the wallet’s private key that had the Bitcoin at the time of the fork. 

After you get all the transaction details (The amount of Bitcoin fork coins you will receive, the value in USD, the transaction fee), review all the details and tap Confirm.

You will then see the updated balance for the Bitcoin fork coins.

Repeat this step for every address with a balance of the forked coin.

How to claim Bitcoin forks using Ymgve’s Fork Claimer

More advanced crypto users that do not want to rely on a specific Bitcoin wallet, can use Ymgve’s script to claim the most Bitcoin forks. This method will require some technical knowledge on the user’s side because you will need to run a Phyton script.

The Ymgve is open-source. It is available on GitHub, along with all the information about how to use the script. Ymgve supports standard P2PKH and Segwit P2SH-P2WPKH addresses.

Using the Ymgve fork claimer script is recommended if you want to claim most forks, although it’s riskier and mistyping any of the commands can result in a loss of funds.  

How do Bitcoin hard forks influence Bitcoin holders?

By the end of 2021, there have been over 100 Bitcoin hard forks, and investors expect to see more soft and hard forks in the years to come. However, out of all the hard forks to date, only a few are still operational.

Long time investors are entitled to claim all of these Bitcoin hard forks. Luckily there are ways to do so, using the wallets described in this article. However, as of the beginning of 2022, no Bitcoin fork has raised more in popularity than the original Bitcoin. 

The Bitcoin network overpasses 500 million transactions

The Bitcoin network overpasses 500 million transactions

by | Feb 6, 2020 | Bitcoin, News

Bitcoin transactions are over 500 million as of the beginning of February 2020. The number of transactions doubled in 3 years, from 250 million in 2017 to 500 million in 2020.

The Bitcoin network went live on January 3, 2009. Eleven years later, in 2020, the network processes over 500 million transactions.

Since 2017, Satoshi.info, named after the pseudonym of the presumable creator of Bitcoin, started tracking and recording the number of transactions on the Bitcoin network.

The data on Satoshi shows a constant increase in the Bitcoin transactions, year after year. In only 3 years, the volume of Bitcoin transactions has doubled and considering the same growth rate, Bitcoin transactions can exceed 1 billion transactions.

How did the community react to the 500 million milestone?

Now, on to the next 500 million.

Is Rolling Back the Bitcoin Blockchain Possible and What Would it Do to Bitcoin?

Is Rolling Back the Bitcoin Blockchain Possible and What Would it Do to Bitcoin?

by | Jun 6, 2019 | Bitcoin, Blockchain, News

In May 2019, Binance lost over 7,000 bitcoins, valued to over $40 million.

The CEO of Binance Changpeng Zhao (CZ) demonstrated that after talking to different parties, he chose to not pursue the re-org strategy for “revenge” on the hacker(s) that was able to steal money from the cryptocurrency exchange

The hack included one trade that transferred roughly 7,074 BTC from Binance’s hot wallet. While CZ thought that reversing the Bitcoin blockchain was possible, he confessed it would not be worthwhile to do this, even for its $40 million which were stolen.

The re-org would observe miners essentially collude to make an alternative continuation of their blockchain rooting out of prior to the block which comprised the hackers’ transaction. This alternative continuation would have to grow quicker than the present one to possess more proof-of-work and watch all of Bitcoin customers re-org for this, accepting it as legitimate.

In its set of experts for doing so, CZ mentioned it might dissuade future hacking efforts, and start looking into how the Bitcoin system would cope with this type of circumstance. The outcome would probably be the end of this, as it might ruin the cryptocurrency’s immutability, and influence consumers’ confidence in it.

Presently, Bitcoin is regarded as a store-of-value and also a kind of electronic gold. Employing the cryptocurrency, whales can move tens of thousands of dollars for exceptionally tiny quantities in fees, which makes BTC a superior asset that is also helpful for remittances and regular transactions.

However, what if miners were to create a cartel to pull a 51% attack on the Bitcoin blockchain to undo trades? This is basically what was at stake if CZ chose to rollback the blockchain, and could most likely hurt Bitcoin’s reputation. Who’d wish to transfer millions using BTC in case the blockchain was not immutable?

Since Nic Carter, a partner at investment firm Castle Island Ventures in Boston, place it through a Telegram message, Bitcoin’s value proposition is based on miners not colluding, like they do this they could”selectively censor, invalidate, or interfere with transactions.” He said :

More to the point if this kind of behavior becomes mainstream — deep reorgs to reverse valid transactions — then Bitcoins settlement assurances are impaired. People will lose confidence in Bitcoin’s ability to settle large transactions.

The Ethereum Precedent

The ones who are involved in the crypto area for some time know that blockchain trades have been reversed before. As soon as the DAO applications on Ethereum watched a hacker stealing 3.6 million ether (worth ~$70 million at the time), the Ethereum blockchain had to perform a hard fork in order to please everyone and to move on after the hack.

At the moment, the Ethereum blockchain was rather young,  but even so, it was a controversial move. Some viewed the hack an unethical, but legitimate movement, and opposed regaining the funds. This saw the community divide, with a few staying on the first blockchain, now called Ethereum Classic (ETC) and fans of ETC chain’s immutability.

Ever since then, various Bitcoin fans have remained away from Ethereum entirely. Commenting on the recent proposal to rollback the Bitcoin blockchain Vitalik Buterin, the Ethereum co-founder, noted that rolling back wasn’t even an option.

Ethereum did a surgical irregular state change. We never even considered actually rolling back the chain to undo the hack; the collateral damage from that (reverting a day of *everyone’s* transactions) would have been huge and possibly fatal.

The billionaire founder of Galaxy Digital Michael Novogratz said that bitcoin is currently viewed as a legitimate shop of riches, which also has a market cap of over $100 billion. Affecting its immutability and standing could see its worth dip.

Some think CZ chose against the rollback since he would not have the ability to pull it off. Miners about the Bitcoin blockchain understand that if they had been to create a cartel to hinder trades, the value of BTC would plummet.

A reorg to recover exchange losses is like a bail-out for a bank mismanaging risk.

Fortunately, it’s so hard to pull off and so likely to fail that unlike banks, there won’t be a bailout here.

Those who fail security get to eat the cost.

@aantonop

This might signify that the 7,000 BTC they’d get paid will be worth a great deal less than $40 million if they would perform a roll back the Bitcoin blockchain. Needless to say that this would impact their company in the long term. As another result of a theoreticall rollback, would be a fall of the hashrate, which makes it much easier for bad actors to pull on a 51% onto it and double-spend coins or mess with all the blockchain.

Even though it is possible, messing with the base of hope on which Bitcoin sits, could put a stop to this flagship cryptocurrency. The simple fact that the most significant cryptocurrency exchange considered a rollback of the Bitcoin blockchain and realised it wasn’t possible, it’s a positive indication of Bitcoin’s immutability.

5 Bitcoin facts you should know before starting trading cryptocurrency

5 Bitcoin facts you should know before starting trading cryptocurrency

by | Jun 4, 2019 | Bitcoin

The blockchain is a technological milestone, not just for the currency world, but for the entire world and industrial fields of activity. As a newbie to crypto and blockchain, it will be hard to understand or to clarify its accomplishments. But every crypto enthusiast should know some basic bitcoin facts before starting trading cryptocurrency.

How important are Bitcoin and the blockchain technology, Bitcoin’s underlying technology? As Bill Gates, the founder of Microsoft, said:

“Bitcoin is a technological show of power.”

Here are a few Bitcoin facts you should know before starting trading cryptocurrency:

 

1. Satoshi Nakamoto Is extremely wealthy

The creator is Bitcoin is Satoshi. That’s how he declared himself to be called in the early stages of Bitcoin. Later on, he disappeared, and today nobody knows how he looks like. We don’t even know if he is just a person or a group of people. To this day, the identity of Satoshi remains a mystery, but what we know is that he has lots of Bitcoin. It has been estimated that Satoshi mined around has around 980,000 BTC.

2. The US government possesses Bitcoin

Cryptocurrencies like Bitcoin might have been created to eliminate the need of a central authority and the need of government to regulated it, but the reality is that the FBI has the second largest Bitcoin wallet following Satoshi Nakamoto.

In late 2013, the FBI shut down Silk Road, an internet drug market, and began seizing Bitcoins belonging to Ross Ulbricht (also known as Dread Pirate Roberts), the operator of this illicit website.

At the moment, the seizure led to a great deal of debate about the cryptocurrency’s future. That’s how today the FBI controls over 144,000 BTC.

3. A private key is necessary to access your Bitcoin

As I mentioned before, Bitcoin was created keeping in mind the inutility of governments and regulatory organs. But there is one big downside to the way Bitcoin works.

Because there is no third party “watching” over your assets, you wouldn’t be able to recover the access to it in the eventuality of a forfeit or theft.
If you were to lose your credit card, let’s say you would accidentally throw it in the trash without noticing, you would be able to contact the back and verify your identity, and they would issue you another card and declare null the old one.

Well, in regards to Bitcoin, it is not really simple. Bitcoin uses private keys to grant access to its owner. ‘a private key is basically a large string of numbers or combination of words.  In the event you misplace your private key, you are going to lose all of your coins. Forever!

Actually, back in 2013, IT employee James Howells lost access to 7,500 Bitcoins, which were estimated to roughly $127 million at the moment. He stated that he accidentally threw the hard disk on which he stored the private key.

4. Bitcoin distribution is Limited

Central banks control the production and supply of traditional money. They can always print more money, and nothing is backing it up.

But, Bitcoin is restricted to only 21 million. Currently, over 17.7 million Bitcoins are circulating, and the last coin is due to be mined in 2140.

5. Bitcoin cannot be prohibited

It’s fairly easy to understand why governments don’t easily embrace the idea of Bitcoin or any other decentralized currency, but the fact is that the cryptocurrency cannot be prohibited, it can only be controlled.

The system was created in such a manner that so long as you have an online connection and a Bitcoin wallet, then you can purchase and swap the cryptocurrency.

These are some basic facts about Bitcoin you should know before starting trading cryptocurrency, which you can now easily explain to your friends. But trading requires more than this basic knowledge, so please make sure to do all the research required before trading.

January 2019: Cryptocurrency Review

January 2019: Cryptocurrency Review

by | Feb 4, 2019 | Bitcoin, News

Goodbye 2018, Hello 2019

What happened to Bitcoin and other cryptocurrencies in January 2019? How did the crypto market perform and what other cryptocurrency news should you look after? Find out some of the cryptocurrency highlights of January 2019.

This is the chart for Bitcoin for January 2019.

bitcoin january 2019 review

The new year started slowly for the crypto market, as it was bouncing between a high of $135.4B and low of around $125B. The first week ended with a market cap of $129B – slightly under a 6% weekly gain.

Cryptocurrency Market Stats (1/4/2019)

Cryptocurrency Market Stats (1/4/2019)The second week of January left us with a drop in the crypto market, with a $123.2B market cap, a 4.5% drop on the week. Most of the top cryptocurrencies saw red during this week as well, with the exception of Tron (TRX) which actually grew 23.71%.

Cryptocurrency Market Stats (1/11/19)

Cryptocurrency Market Stats (1/11/19)A rather uneventful week was the third week of the year. The total market cap was at around $122B.  Most individual cryptocurrencies stayed within single-digit gains and losses. A few exceptions were Augur (56.85%), Chainlink (20.45%), and TenX (78.94%).

Cryptocurrency Market Stats (1/18/19)

Cryptocurrency Market Stats (1/18/19)

The fourth week started on a positive note but ended up being a disappointment for cryptocurrency prices. The cryptocurrency market cap dropped about 1.6% and currently sits at $120 billion. The only coins showing any double-digit movement were Waves (12.99%), Holo (76.98%), and Factom (14.59%) among a few others.

Cryptocurrency Market Stats (1/25/19)

Cryptocurrency Market Stats (1/25/19)

Cryptocurrency and Blockchain News

31st December 2018 

The online retailer Overstock announced it would pay a part of its Ohio state business tax using Bitcoin.

The state will charge a 1% fee on payments made with Bitcoin, which is less than the 2.5% service fee on credit card payments.

7th January 2019

Some northern Nevada areas are utilizing blockchain to store computerized version of government records like birth and marriage certificates.

The U.S. National Aeronautics and Space Administration (NASA) published a proposal for using blockchain for air traffic data. They describe it as “an open source permissioned blockchain framework to enable aircraft privacy and anonymity while providing a secure and efficient method for communication with Air Traffic Services, Operations Support, or other authorized entities.”

8th January 2019

Nick Szabo, one of Bitcoin’s earliest developers, spoke at the Israeli Bitcoin Summit. During his presentation, he made a bold claim, “There’s going to be some situations where a central bank can’t trust a foreign central bank or government with their bonds…a more trust minimized solution is cryptocurrency.”

10th January 2019

Darren Soto, blockchain’s biggest fan on Capitol Hill, told Cheddar.com this week that the SEC shouldn’t have jurisdiction over most cryptocurrencies. He stated that “securities laws can be very intense”, which inhibits the growth of blockchain technology.

15th January 2019

The state of Wyoming proposed a bill to legalize the tokenization of stock certificates for corporations. Beyond stock issuance, the bill would make voting via blockchain legally binding as well.

Blockchain companies are beginning to notice too. IOHK, the development company behind Cardano, has announced plans to relocate from Hong Kong to Wyoming.

16th January 2019

Exchange owners reacted to Cryptopia’s recent hack. Binance CEO Changpeng Zhao (CZ) outlined the risks of storing funds yourself, encouraging users to only store coins on reputable exchanges or, even better, decentralized exchanges (DEXs).

17th January 2019

Professors from MIT, Stanford, and Berkeley will attempt to create a new cryptocurrency with faster transaction speeds and the same core decentralization principles of crypto. The new crypto, Unit-e, will allegedly process up to 10,000 transactions per second utilizing a new form of sharding.

Unit-e is the first project under Distributed Technology Research, a non-profit for creating decentralized tech and backed by investors such as Pantera Capital.

18th January 2019

The Pennsylvania Department of Banking and Securities (DoBS) talked about the classification of cryptocurrencies: “only fiat currency, or currency issued by the United States government, is ‘money’ in Pennsylvania.” This classification means that cryptocurrency exchanges and kiosks like Bitcoin ATMs are not required to get Money Transmitter Licenses (MTLs).

According to the DoBS, to require an MTL, “fiat currency must be transferred with or on behalf of an individual to a 3rd party, and the money transmitter must charge a fee for the transmission.” As crypto entities exchange fiat for crypto directly, they do not qualify. This is great news for cryptocurrency businesses, but they still have to follow the stricter rules of the federal government and other states in which they wish to operate.

22nd January 2019

CNBC hosted a panel in Davos, Switzerland. Here are some memorable quotes regarding Bitcoin, cryptocurrency, and blockchain technology from the discussions:

Jeff Schumacher (Founder, BCG Digital Ventures): “I do believe [bitcoin] will go to zero. I think it’s a great technology but I don’t believe it’s a currency. It’s not based on anything.”

Glen Hutchins (Chairman, North Island): “The way to think about the value of the tokens is as a derivative of the use value of the protocols they enable.”

Brad Garlinghouse (CEO, Ripple): “The long-term value of any digital asset is derived from the utility it delivers.”

Edith Yeung (Partner, 500 Startups): “I think it’s a really good thing that now the crypto secondary market has, in some way, fizzled out because the people who are here now building are the ones that really believe in the technology.”

 

What is Bitcoin Cash (BCH)?

What is Bitcoin Cash (BCH)?

by | Oct 16, 2018 | Bitcoin, Crypto wiki, Cryptocurrency

Based on their site, Bitcoin Cash is defining itself: “Bitcoin Cash is peer-to-peer electronic cash for the Internet. It is fully decentralized, with no central bank and requires no trusted third parties to operate.”

Bitcoin Cash (BCH) is comparable to Bitcoin in several ways, beginning with its own name. But let us say the differences out:

  • The blocksize is 8 MB.
  • It will not have segwit.
  • It will not have the “replace by fee” feature.
  • It’s going to have replay and wipeout protection.
  • It features a means to correct the proof-of-work difficulty faster compared to normal 2016 block issue modification period located in Bitcoin.

Bitcoin Cash is due to a hardfork, which occurred on August 1, 2017. In 2017, Bitcoin has come under a great deal of criticism because of its scalability problems that has given rise to lots of disagreements that are politically in addition to ideologically motivated.

The end result was this tricky fork that gave birth to Bitcoin Cash.

What’s a hardfork?

The main difference between a gentle fork and hardfork is the fact that it isn’t backward compatible. When it’s used there’s absolutely no going back at all.

If you don’t combine the updated version of this blockchain then you don’t get access to some of those newest updates or socialize with users of this new system at all.

You can not play PS3 games on PS4 and also you can not play PS4 games on PS3.

hardfork bitcoin cash

Andreas Antonopoulos Clarifies the difference between Soft and Hard fork like That:

If a vegetarian restaurant could opt to add pork into their menu it could be regarded as a tricky fork. If they’d opt to add vegetarian meals, everybody who’s vegetarian might still eat vegetarian, you do not need to be vegetarian to eat there, you might continue to be vegetarian to eat meat and there eaters could eat there also so that is a tender fork.

But for any significant modifications to take place in bitcoin, the machine should come to a consensus. So, how can a decentralized market come to an arrangement on anything?

At the moment the two largest ways that are attained are:

  • Miner Activated: Fundamentally changes which are voted by miners.
  • User-Activated.: Changes which are voted on by people with busy nodes.

This is where Segwit arrives to perform a role.

What’s segwit?

To be able to comprehend why bitcoin money is, it’s necessary to get some notion about exactly what segwit is.

Once you closely analyze a cube, this is exactly what it seems like:

blockchain block looks like

Image: Riaz Faride

There is the block header of course which has 6 elements in it, namely:

  • Version.
  • Previous block hash.
  • Transaction Merkle roots.
  • Epoch time stamp.
  • Difficulty target.
  • Nonce.

What does a Bitcoin transaction consist of? 

  • The sender details which is the input.
  • The receiver details i.e. the output.
  • The digital signature.

The digital signature is really important because it is what verifies whether the sender really has the required amount of funds needed to get the trade done or not.

But there is a big issue with it. Space which already is in limited availability as a result of its 1 MB block size. In reality, the signature accounts for nearly 65 percent of the space taken by a transaction!

Dr. Peter Wuille has produced a remedy for this, he predicts it Segregated Witness aka Segwit.

That is what will occur once segwit is activated, all the sender and receiver details will go inside the primary block, however, the signatures will move into a new block known as the “Extended Block”.

what is segwit

Segwit will create more space in the blocks for more transactions.

Pros of segwit:

  • Increases a number of transactions that a block can take.
  • Decreases transaction fees.
  • Reduces the size of each individual transaction.
  • Transactions can now be confirmed faster because the waiting time will decrease.
  • Helps in the scalability of bitcoin.
  • Since the number of transactions in each block will increase, it may increase the total overall fees that a miner may collect.

Cons of segwit:

  • Miners will now get lesser transaction fees for each individual transaction.
  • The implementation is complex and all the wallets will need to implement segwit themselves. There is a big chance that they may not get it right the first time.
  • It will significantly increase the usage of resources since the capacity, transactions, bandwidth everything will increase.

When the programmers built SegWit they included a particular clause for this. It may only be triggered when it’s 95% acceptance in the miners. After all, it’s a massive shift in the machine and they guessed that acquiring a great majority was the best way to go. But this caused a disturbance in the system. Many miners do not desire segwit to be triggered. They’re frightened that because the available block distance increases, it will radically reduce the transaction fees which they can get. Because of this, they stalled segwit that subsequently infuriated the consumers and companies who desperately desire segwit to be triggered.

What’s a BIP?

There are 3 Types of BIPs:

  • Standards Track BIPs: Changes into the system protocol, trade, and cubes.
  • Informational BIPs: Coping with design problems and overall guidelines.
  • Procedure BIPs: Changes into the Procedure.

What’s BIP 148?

The BIP 148 is an individual triggered soft fork i.e. a gentle fork that’s been triggered from the users. What it says is that each one of the full nodes at the bitcoin networks will reject all blocks which are being generated without segwit ingrained inside. The concept is to inspire the miners to place segwit activation from the cubes they mine in order for it to be a part of their machine.

It’s estimated that by encouraging an increasing number of miners to return into the BIP 148 side, finally the 95% threshold limitation is going to be spanned and segwit is going to be triggered. You will find fictitious fears of a series divide occurring but that is easily prevented if only 51% of those miners come around to the BIP 148 side. Have over half of those miners, on the other hand, will significantly lessen the hash speed of this heritage chain i.e. the initial series.

Going from the coordination game-theory, the miners will be forced to return to another side with most. This nevertheless raised a critical concern. Imagine if the shift over does not occur smoothly and suppose that it can cause a valid chain divide? This may spell tragedy and this is the specific difficulty raised by the mining firm Bitmain.

What’s the UAHF?

The User Activated Hard Fork is a proposition by Bitmain that will allow the building of a completely different sort of bitcoin and cubes with bigger dimensions. Because this is a tricky fork, the series won’t be backward compatible with the remainder of the bitcoin blockchain. The largest reason why this seems so attractive is the tricky fork doesn’t expect the vast majority of hashpower to be enforced. All nodes that take such rule set changes will automatically stick to this blockchain irrespective of the service it receives. At precisely the exact same time, a lot of individuals simply were not pleased with the notion of signatures being stored separate from the remainder of the trade information, they believed it to be a hack.

If you do not like it then jump boat and you are able to be part of the new series.

Since Bitcoin money is due to a hardfork, anybody who owned Bitcoin money got the equivalent number of coins at BCH PROVIDED they did not possess their BTC in trades and have been in possession of the private keys in the right time of their hardfork.

Among the greatest characteristics of Bitcoin Cash is the way that it circumnavigates among the largest issues that any cryptocurrency may confront post-forking, the replay attack.

Bitcoin Cash: What’s a replay attack?

A replay attack is information transmission that’s maliciously replicated or postponed. In the circumstance of a blockchain, it’s taking a trade that occurs in 1 blockchain and maliciously replicating it in a different blockchain. Eg. Alice is sending 5 BTC into Bob, below a replay attack she’ll send him BCH also, although she never supposed to do this.

(data are obtained out of Andre Chow’s response in pile exchange)

These transactions are invalid on the non-UAHF string as the various sighashing algorithm will lead to invalid transactions. Any transaction which includes this series will be considered invalid by bitcoin money nodes before the 530,000th block. Fundamentally, before that obstruct you’ll be able to divide your coins by transacting on the non-UAHF series with the OP_RETURN outputsignal, then transacting on the UAHF series next.

How can Bitcoin Cash draw miners?

Any cryptocurrency depends greatly on its own miners to operate easily. Recently, bitcoin money has attracted a great deal of miners that has considerably improved its hash pace. This is how they did this.

Bitcoin money has a set rule regarding when it reduces its own difficulty. It’s the median of the previous 11 blocks which were mined at a blockchain. Fundamentally, line up the previous 11 blocks one after the time where the centre block is mined is that the median time beyond this set. The MTP helps us determine the exact time where future cubes can be mined also. Here’s a graph of the MTP of different blocks:

blockchain mtp

Image: Jimmy Song Medium article.

This is the principle for difficulty alteration in bitcoin money: In the event, the Median Time Past of the present block, as well as the Dominion Time Past of 6 cubes prior to, is higher than 12 hours the problem reduces by 20% i.e. it becomes 20% easier for miners to locate newer blocks. This offers the miners some ability to correct an issue, eg. Check out the 13-hour gap between cubes 478570 and 478571. The miners might have only been doing so to create the cubes easier to mine.

Another interesting point to notice is how and if the problem rate can adjust to a cryptocurrency. This is a chart which monitors the problem rate of BCH:

difficulty rate adjustment in cryptocurrency

Image source: Bitinfocharts.com

 

 

 

 

 

 

The problem rate adjusts based on numerous miners from the computer system. Whether there are fewer miners, then the problem rate goes down since the entire hashing power of this machine goes down. When bitcoin money first began it was fighting a little to get miners, consequently, its issue dropped down radically. This, in turn, attracted many miners who discovered that the chance to be quite lucrative. That triggered an exodus of miners out of BTC so much to ensure that the hashing ability of BTC halved, decreasing the trade time and raising the prices. Reports on social websites said that BTC trade has been taking hours and even days to finish.

Here is the graph that shows the drop in hash rate of BTC:

difficulty rate adjusts

Image source: Investopedia

The value of Bitcoin Cash

At the moment of writing (October 2018), Bitcoin Cash is the second most expensive cryptocurrency, after Bitcoin (BCT), trading at $461.43 for 1 BCH.

chart bitcoin cash bch october 2018

Image: CoinMarketCap

Nobody can forecast what is going to occur to Bitcoin, Bitcoin Cash or some other token or cryptocurrency. The effect which Bitcoin Money might have on Bitcoin, later on, is unforeseeable.

What we do know is this is actually the first time that anybody has hardforked out of BTC whilst retaining the documents of the present transactions. What we have here is a really interesting experiment that can teach us many lessons moving ahead.

At precisely the exact same period, the 8 mb block dimension is absolutely an extremely sexy facet and it remains to be seen just how this impacts the miners in the long term. Can this address all of the scalability problems? Can BCH ever overtake BTC and eventually become the main string? These queries are only speculations for the time being. What we can say for certain is that we’ve got a rather interesting future ahead.