Bitcoin Hard Fork Might Have Gamblers Pick Sides

Facebooktwittergoogle_plusredditpinterestlinkedinmailby feather

If you’ve been using your Bitcoin wallet during the past days, you’ve surely seen that your Bitcoin’s value was continuously fluctuating, especially in the past week. Of course, this is nothing strange for Bitcoin, as things have always been this way, but the reason for these recent fluctuations is important to note, as it might change the way you gamble with Bitcoins in the future.

Namely, ever since last weekend, the Bitcoin community has been buzzing with talks about a possible Bitcoin “hard fork” coming soon. To put it simply, the “hard fork” is basically another term for a split of Bitcoin’s blockchain, which in this case will be triggered by two opposing sides of developers who want to make changes to Bitcoin’s core blockchain code.

If either side gathers enough support to launch the change, there will inevitably be two types of Bitcoin, much like what was done with Ethereum. Needless to say, Bitcoin online casinos will also have to decide whether they’ll continue to accept one or both currencies.

The Bitcoin Unlimited Proposal

Over the past years, there has been a very fiery debate as to how Bitcoin should be upgraded to allow it to become more scalable that it currently is.  As of now, Bitcoin’s block size can only handle 1MB of data, which covers only a limited number of transactions to be mined per second. Changes to this limit have been discussed for years, to no avail, until one Bitcoin group decided last week it might be time to finally take action.

The proposal is to re-program the blockchain to increase the block size and thus create a new version of it where more transactions could be handled per second. This change also creates a “hard fork” with two separate versions of blockchain: old and new, and thus could lead to two separate currencies. The said change comes at the suggestion of a group of high-volume mining pools and the project is aptly named Bitcoin Unlimited.

The Bitcoin Unlimited Project is said to be leading to a new currency of the same name, and although it will bring a solution to a much-debated problem to the table, it is also feared to be leading to a more centralized network instead of the autonomous one it has so far been.

Namely, the key concerns are that the mining pools behind it will be given more power over the network, including the power to slap additional fees. However, to do this, the group needs support from 95% of the miners before it can activate the change. Some exchanges have even started preparing emergency plans in case the group succeeds and alternative Bitcoin versions appear.

The SegWit Solution

On the other side of the debate is a proposal called Segregated Witness, or SegWit, for short, which would also see Bitcoin’s block size increase, but without creating a hard fork. Instead of splitting the blockchain, SegWit aims to double the block limit by eliminating some of the data that isn’t vital to the process but also move some transactions outside of the chain.

This solution will keep Bitcoins more decentralized and create a so-called “soft fork”,  which will see only the mining majority update to the new blockchain version, while the rest will retain the old. As of now, SegWit is rapidly gaining support, but has only 30% of mining pools convinced, while Bitcoin Unlimited has 36.3%. Thus, it will probably be a while before any changes to your favorite Bitcoin casino is made.

 

March 29, 2017: • No Comments

Comments are closed.