The embattled cryptocurrency will face another major challenge with a new Bitcoin fork scheduled to take place in three months time.
For months, Bitcoin has overcome backlashes from issues surrounding its performance and operational process. Community members were left confused, and some investors were forced to withdraw their investments for fear of debilitating Bitcoin ‘forks’.
The internal struggle among the developers eventually led to a hard fork early this August, and gave birth to a new cryptocurrency: Bitcoin Cash.#Bitcoin is facing another possible #hardfork drama in November. Click To Tweet
Three weeks after the said event, legacy Bitcoin emerged unscathed. For two weeks, the virtual currency’s value steadily climbed, surpassing its $4,000 USD mark just last weekend. For a while, the future of Bitcoin looked more promising than ever before.
Just when everyone thought that the worst had passed, another Bitcoin fork is expected to happen this coming November.
Upcoming Bitcoin Fork: The Segwit2x
In three months, the world will witness another Bitcoin fork, and this time, the developers behind the Segwit2x will make it happen.
What is Segwit2x?
Aside from the technical team behind the Bitcoin Cash, another group of developers also laid out their proposal on how to boost Bitcoin’s transaction capacity. To give you a short preview, the debate over legacy Bitcoin’s current design and performance revolves around the following:
- Bitcoin’s 1MB block size which limits the number of transactions that could be processed per data block every 10 minutes.
- Due to block size limitations, it takes longer for transactions to be approved especially during times of heavy use.
- Longer processing time and limited block size increased the average fee cost.
- Increasing the block size will make network nodes costly since node operators would need to store the entire copy of the blockchain as computer files.
According to Coindesk, Segwit2x wishes to address these issues by upgrading Bitcoin in two ways:
- It would enact the long-proposed code optimization Segregated Witness (SegWit), which alters how some data is stored on the network.
- It would set a timeline for increasing the network’s block size to 2MB, up from 1MB today, to be triggered about three months after the SegWit activation.
While Segwit2x was not endorsed by Bitcoin Core, the network’s primary open source developer, it has gained support from major mining pools in the network, Bitcoin exchange startups like Coinbase, BitPay, and Blockchain, and developers such as Gavin Andresen.
Specifically, Segwit2x is supported by the following:
- 58 companies located in 22 countries
- 83.28 percent of hashing power
- 5.1 bln USD monthly on chain transaction volume
- 20.5 mln Bitcoin wallets
Yours CEO Ryan Charles said in a statement to Coindesk:
“Many Bitcoin Core developers stopped listening to businesses, miners, and users over two years ago. If they are unwilling to compromise, then the compromise will move forward without them. We will continue to support the proposal even if developers do not.”
Genesis Mining co-founder and CEO Marco Streng expressed the same sentiments.
“If a hard fork is the only way to solve the scaling problems – among other issues – then that is how it has to be.”
The Bitcoin Fork is Unstoppable
In a post published by developers of Segwit2x on GitHub, the team announced that the upcoming hard fork would happen at Block 494,784. The post read:
“During the month of November 2017, approximately 90 days after the activation of Segregated Witnesses in the Bitcoin blockchain, a block between 1MB and 2MB in size will be generated by Bitcoin miners in a move to increase network capacity. At this point it is expected that more than 90% of the computational capacity that secures the Bitcoin network will carry on mining on top of this large block.”
Around August 23, an expected soft fork would be activated following the Segregate Witness locked-in last week.
“Bitcoin clients that are not currently SegWit-compatible and wish to benefit from the new type of transaction must perform extensive upgrades to various subsystems, including changes to transaction serialization, signature hash computation, block weight calculation, scripting engine, block validation, a new address scheme, and P2P protocol upgrades,” the post further stated.
The team also released a readiness checklist.
For SegWit-compatible clients:
- Maximum block weight doubles from 4,000,000 to 8,000,000
- Sig-ops per block doubles from 80,000 to 160,000
For non-SegWit-capable clients:
- Maximum base block size doubles from 1,000,000 to 2,000,000
- Sig-ops per block doubles from 20,000 to 40,000
Both types of clients should add new DNS seeds:
- BitPay: seed.mainnet.b-pay.net
- OB1: seed.ob1.io
- Blockchain: seed.blockchain.info
- Bloq: bitcoin.bloqseeds.net
Right now, the future of Bitcoin is once again shrouded in uncertainty. Some experts believe that November could be another critical point for the leading cryptocurrency. Should the 83.28 percent of the Bitcoin community stay committed to the Segwit2x plan, it would definitely result to an inexorable hard fork.