Bitcoin is sliding after bitcoin gold goes live
Markets Insider
- Bitcoin is trading down 4.5% Tuesday following a split in the cryptocurrency's blockchain network.
- Bitcoin gold, the new digital coin formed by the split Tuesday morning, follows the bitcoin-bitcoin cash fork in August.
- The project website for bitcoin gold is down following a DDoS attack, according to cryptocurrency watcher CoinDesk.
- The bitcoin community is split over whether forks are good or bad for bitcoin.
Bitcoin, the red-hot digital currency up more than 400% this year, was trading down 4.42% Tuesday morning after the blockchain network underpinning the coin split again.
As reported by cryptocurrency watcher CoinDesk, bitcoin gold officially split from the bitcoin network Tuesdaymorning. The new cryptocurrency is a clone of the original bitcoin blockchain, but it will play by different rules than the original digital currency.
"Instead of scaling bitcoin to support more users, bitcoin gold tweaks bitcoin in an effort to 'make bitcoin decentralized again,'" CoinDesk reported. "This, proponents argue, will make the network, designed to offer an egalitarian way to send payments digitally around the globe, more accessible to users."
Bitcoin cash separated from bitcoin earlier this year following mounting disagreements amongst the coin's power brokers over how to scale the cryptocurrency. Since bitcoin is open-source, folks can freely update its underpinning software.
Twenty exchanges will back the new cryptocurrency, meaning folks who own bitcoin on certain exchanges will now hold one bitcoin gold for every bitcoin. Bitcoin owners should not expect, however, to see the value of their holdings double.
Separately, it appears bitcoin gold's website is down following a DDoS attack, a type of cybersecurity attack. Here's a tweet from the cryptocurrency's developers:
Massive DDoS attack on our cloud site. 10M requests per minute. We are working with the providers to ban all the IPs. We will be up soon!
CoinDesk first reported the news.
The cryptocurrency community appears divided over whether splits are good for the future of bitcoin.
Bob Summerwill, a chief blockchain developer at Sweetbridge, a cryptocurrency liquidity provider, said in a note emailed to Business Insider that there is no such thing as a 'bad fork.'
"Splits happen periodically in all open-source communities," he wrote. "Having everyone collaborating in a single project is ideal, but sometimes there are genuine differences of opinion, and network effects are not enough to keep everybody together, so a group secedes."
Others are less bullish on splits. For instance, Sol Lederer, a blockchain director at LOOMIA, said he is worried about trivial disagreements disrupting the upward march of bitcoin.
"What's deeply troublesome is that these spinoffs sprung from a relatively minor squabble in the bitcoin community on how to handle the block size limit," Lederer wrote. "Instead of coming to agreement, the community, developers, and code are fracturing into different groups."
Another fork is possibly on the horizon. The second part of SegWit2x, which would increase the size of blocks that underpin bitcoin's network, is set to go into effect next month and not everyone is on board with the proposed change.
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