What Will Happen If Bitcoin Hardfork Splits? – Trustnodes

What Will Happen If Bitcoin Hardfork Splits?


A bitcoin split is on the table and seems likely. Big blockers do not trust the segwit2x compromise as most of them seem to think miners will unravel once segwit activates, breaching the agreement just as some of them breached the Hong Kong agreement.

As such, they seem to have come up with a new client, Bitcoin Adjustable Blocksize Cap (ABC) which forks on August the first regardless of any mining support.

“It’ll fork off Aug, 1. There is “block must be big” rule that will definitively fork the chain,” one of BitcoinABC’s developer publicly said.

That means there will be two bitcoins, each on their own chain, with its own miners, with its own nodes, with its own network.

Every bitcoiner will receive the same amount of bitcoins they have at the time of split on the Bitcoin Core chain (BCC) and on the BitcoinABC chain which may be followed by Bitcoin Unlimited and listed as BTU.

As far as the code and technicalities are concerned, there shouldn’t really be any problems, although BitcoinABC seems to still be refining their client, but any bug is likely temporary.

For good measure, exchanges will probably stop trading around 12 hours before and 12 hours after the fork, as GDAX has stated they will, with all bitcoiners advised to refrain from making transactions on that day or wait for a very high number of confirmations, which amounts to 10 or 12 hours.

After the dust settles and if bitcoin does split, all exchanges will probably list both coins, but the minority chain will need at least one exchange to do so for it to have a market.

If any exchange does, then a period of very high volatility and frenzied bitcoin trading should be expected as the market decides on the value of the two digital currencies.

Non-bitcoin digital currencies may benefit as a safer heaven, or may respond to bitcoin’s price movements, with the two bitcoins combined price potentially being higher than bitcoin’s current price, as it currently is on future’s trading, but it might also be lower.

Eventually, the market is likely to settle on a price, with the two communities potentially going their own way, focusing on their own roadmap.

It is difficult to predict what relative price they might settle on. Bigger blocks do have strong support, but just how strong it is not known.

The best case scenario would be for one of the coins to be at 80%-90% of the current price, while the other at 10%-20%, with the minority coin probably following the movements of the majority coin.

The worst case scenario might be a nearly 50%-50% price split, because then new users might be very confused as to which is bitcoin, but it is unlikely the market would value them so equally, with one dominant coin probable.

Which one would be dominant is difficult to say. Hashrate follows price, so that wouldn’t be an indication, but BTU will probably start off as a minority coin which might be indicated in the price. However, that may be only initially as the market might decide to value it higher.

In any event, we might find out shortly as bitcoin heads towards its most important day in its history, August 1st, when after more than two years of vicious debate, they finally decide how exactly they will progress forward.


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