If you’ve been keeping up with cryptocurrency news (and you should; if you don’t, subscribe to Money Trade Coin for all of the latest), you may have heard about a recent development: Bitcoin Gold.
It’s been making all of the news in the Bitcoin world, but many people are unsure of what it is and why it’s been drawing so much opinion. So let’s get into, shall we?
The architects behind Bitcoin have released this new version of Bitcoin, which is basically a new currency, to combat the influence of excessive miners on the Bitcoin network. The trouble with the cryptocurrency is that the mining of new bitcoins (which if you don’t know, is how anyone can get more bitcoins; read more here), can often find itself limited to a selected group of individuals who know how the system works and use it to gain as much as possible. This leaves Bitcoin mining a difficult prospect for a large portion of the network.
Bitcoin Gold, characterized as a fork in the road for the cryptocurrency, attempts to resolve that issue, while also offering a potential solution to greater scaling and governing conundrums. It also attempts to alter the current proof-of-work algorithm that Bitcoin uses, to a more modern one, rendering mining equipment based on the older algorithm obsolete.
What this will mean is that Bitcoin mining will become faster, cheaper and more accessible to the public - everyone will be able to do it and do it more easily. This is in keeping with Bitcoin founder Satoshi’s belief that the cryptocurrency network should be a democratic one, not in the hands of certain individuals or groups who control mining.
There are both backers and critics of the new currency. The latter sees concerns about security and stability with Bitcoin Gold, though the former says that is expected for any new entrant in the digital currency space. The underlying advantages of blockchain technology apply to this new currency and should immunize it from the aforementioned effects.
Right before the release of the Bitcoin Gold, the development team announced that they would introduce a ‘replay protection’ system. This new policy would prevent users from spending both Bitcoins and Bitcoin Gold to make a transaction. This prevents from sending cryptocurrency to unintended recipients. Because it is all occurring on the same network, there is a chance that this might occur. But the replay protection system prevents it from happening.
One thing is for certain: the fact that Bitcoin now possesses two separate currencies is a sign that the mania behind cryptocurrency is spreading and that people show more interest and confidence in it. Bitcoin Gold is currently valued at about $130. The value is expected to increase over time, though no one is willing to make exact predictions, given that it is a new experiment in the already unchartered territory of cryptocurrency.
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