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Get ready for a wave of Bitcoin forks

posted onNovember 30, 2017
by l33tdawg

On August 1, a dissident faction of the Bitcoin community created a new payment network called Bitcoin Cash. There are lots of Bitcoin-derived spinoff currencies, of course, but this was unusual because it branched off from the existing Bitcoin blockchain. The result was the cryptocurrency equivalent of a stock split: everyone who owned one bitcoin before the split suddenly owned a "cash" bitcoin after the split.

Today, the value of Bitcoin Cash in circulation is about $20 billion. That makes it the third most valuable currency, after only the original Bitcoin and Ethereum. And this appears to be newly created wealth. The value of vanilla bitcoins didn't fall significantly on the day of the split, and it has since zoomed upwards so that the value of all conventional bitcoins is now around $150 billion.

With that kind of money on the table, it was inevitable that others would try the same trick. In early November, another group of Bitcoin developers publicly launched the Bitcoin Gold network. This version of Bitcoin swaps out Bitcoin's current mining process—where people compete for bitcoins by computing SHA-256 hashes using custom-designed mining hardware—with a memory-hard algorithm that, designers hope, will make it resistant to acceleration by custom hardware. The creators say they want to re-democratize Bitcoin mining, once again making it possible for anyone to earn Bitcoin Gold with their home PCs.

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