Trader Note

Be careful of impatience for an exit around dinner. It will cost ticks.

Bitcoin Gold Fork Explained

Today, there was a Bitcoin fork where a new crypto currency called Bitcoin Gold was created. This is NOT a true fork in the code. This was a separate entity (Bitcoin Gold) copying the current Bitcoin ledger at a specified time (block). Any wallet with Bitcoin then receives the same amount of Bitcoin Gold in a new wallet… if you can find one that is not a scam.

This is a block chain copy and not a fork because the code of the main ledger chain of Bitcoin was NOT altered. A crypto currency merely copied that information that freely available to create a new product. As would be expected from a copy of a currency, it was quickly sold off.

When Bitcoin split from Bitcoin Cash in September, this was a true fork. That is because the code of the main chain was updated while the original code (Bitcoin Cash) was left mostly behind by the market. It could be said that the current chain of Bitcoin is a copy of that original ledger, which it is, but that copy is now the primary chain.

The reason that the Bitcoin chian is the new primary chain over Bitcoin Cash is because of market adoption. Miners and users within the market have accepted the code updates required to extend the life of this chain. Those purists that did not want to dilute the primary chain still use Bitcoin Cash, but it is not as widely accepted as an actual currency.

Acceptance is critical for a currency to be useful.

So the current copy of Bitcoin Gold will likely not be useful because it is not finding wide market acceptance. If you bothered to load a wallet with it, sell it fast before it loses all value.

Soon, Bitcoin (primary blockchain) will be having another code update to extend useful lifespan of this code. This may give the market some jitters, which will mean a lower price against fiat currency in the short term. Do not expect any of these dips to last long before another move higher in Bitcoin price occurs. After the code update occurs, expect the price to move steadily higher as wider adoption fuels markets appetite for Bitcoin.

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