People are talking about Bitcoin hard fork that happened yesterday, the August 1st. Each news website covers certain aspects of this event. Some talk about Bitcoin getting a software upgrade, while others focus on the implementation of the new ’Bitcoin Cash’. Looks like after all, we’ve got two news in one. Let’s try to understand what really happened and how we, as miners, can profit from this.
Act I: Bitcoin Getting and Upgrade
It’s no news that until today Bitcoin was getting slower by the day. With a hard limit of only 7 transactions per second, Bitcoin was no longer able to deal with the growing popularity it was getting. Eventually, this limit would lead to the death of the cryptocurrency simply because people would get frustrated and would stop supporting BTC.
In order to prevent that, developers decided to perform a software upgrade called ‘Segwit2x’. The upgrade was ready to be implemented some time ago, but developers were not able to get a consensus on whether the Segwit2x was the optimal solution to BTC scaling issue. Now that the cryptocurrency has reached a critical point, most developers finally agreed to implement the upgrade.
Act II: The Birth of a New Altcoin
As always, it is not possible to please everyone. Eventually, there is a group of people who dislike Segwit2x at the point that they decided to create a new altcoin. They called it ‘Bitcoin Cash’ and it is meant to replace the old Bitcoin. It has bigger block size and in theory it is meant to be technically more advanced that the ‘good old’ Bitcoin.
Those two events happened the same day. As soon as the Segwit2x was implemented, Bitcoin Cash was delivered to BTC holders in order to give them an alternative. This gave people the feeling that “Bitcoin split into two currencies”. What we really see here is the birth of a new altcoin – or that’s how most experts and investors call it. Few people believe that ‘Bitcoin Cash’ will replace the original BTC in any way.
Not all investors are supportive of this new altcoin. People are usually reluctant of investing into something new. However, many speculate that Bitcoin Cash will gain more trust and popularity since now BTC holders automatically got equivalent funds in Bitcoin Cash.
As for today, some of the most popular online wallets such as Bitstamp and Coinbase are not supporting Bitcoin Cash.
Bitcoin Cash’s lead developer Amaury Sechet is pleased by the support this new currency is getting. He told CNBC that: “The current price may [seem] low but this is actually an amazing level of support.”
Bitcoin Cash Mining
As a miner by heart, you probably already wonder how to mine BCC. Or how profitable is it to mine the coin to begin with.
Good news is – the first block was already mined a couple of hours ago by a mining firm called ViaBTC, which means that Bitcoin Cash is not a myth and that it can be mined.
Bad news is that it took them rather long to mine the first block. According to CNBC, “[…] Bitcoin cash required the same amount of computational work as Bitcoin[…]” and furthermore, “The fact the block is taking so long is making people reevaluate”
This means that as for today, mining Bitcoin Cash might not be the best option out there. BCC is worth a fraction of BTC while having roughly the same mining time. People who mine BCC are those who believe that it will replace BTC someday soon. As for today, mining BCC is probably pretty much the same as investing into stocks of a new company which might, or might not flourish in the future.
If you want to mine BCC, there is one pool available at the moment. This video shows how to start mining on ViaBTC.
Note: There is an expected difficulty reduction for BCC that will take place in about two weeks due to the BCC mining community being smaller than the BTC one.
While Bitcoin Cash is not the new Ethereum, there is chance that it might affect the mining community in unexpected ways. I am keeping an eye on how this coin evolves. Some people are hyped about it, others hate it, but few remained neutral to the news. What about you? Will you buy or mine it?
Thank you for reading. As always, your comments, suggestions and questions are welcome.
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Disclaimer: This is not financial advise, I am not a financial advisor, this is for educational purposes only. If you want to invest in cryptocurrency please do your own research and invest at your own risk, 1stMiningRig is never liable for any decisions you make. 1stMiningRig may receive donations or sponsorships in association with certain content creation. 1stMiningRig may receive compensation when affiliate/referral links are used.