Bitcoin retreats as another offshoot of cryptocurrency appears1 min read . Updated: 24 Oct 2017, 05:41 PM IST
Called bitcoin gold, the offshoot comes less than three months after bitcoin cash was created
Hong Kong: First there was bitcoin, then bitcoin cash—and now there’s bitcoin gold.
A new iteration of the cryptocurrency has been formed after some developers split the blockchain, the digitised ledger on which the bitcoin is based. Called bitcoin gold, the offshoot comes less than three months after bitcoin cash was created.
Bitcoin dropped 3.6% to $5,699 as of 4.41pm in Hong Kong, paring a drop of as much as 5.9%. The cryptocurrency is still up 37% this month and 499% this year.
While independence from any central authority is part of bitcoin’s appeal, that’s also made it more susceptible to such so-called “hard forks" when there are differing visions within the cryptocurrency community. Bitcoin gold aside, bitcoin miners and developers have been embroiled in a debate lately over an upgrade of its protocol that’s aimed at speeding up transactions. A lack of consensus is threatening yet another schism next month.
“Bitcoin’s recent downturn has been driven by the traders’ anticipation of minor disarray in the wake of the upcoming hard forks," said Thomas Glucksmann, Hong Kong-based head of marketing at cryptocurrency exchange Gatecoin Ltd. “The bitcoin exchange and wallet community has been divided over their decisions to support or reject these contentious hard forks."
Bitcoin gold’s main innovation makes it easier for people without special hardware to mine the digital asset, according to its website. Instead of powerful mining machines called ASICs used in bitcoin, users can mine it with standard gaming graphics cards, similar to how mining is done with ethereum, the website says. After the split, bitcoin owners stand to receive one bitcoin gold for each bitcoin, assuming their wallets or exchanges support the new creation, it said.
Further splits may be imminent. One faction of the community wants to increase bitcoin’s blocksize in order to shorten transaction times, while another is opposed. The first phase of this plan, called SegWit2x, was implemented in August and took some of the data off the main network. Bloomberg