Bitcoin Gold: Next bitcoin bitcoin

On the nose of the next hardcore bitcoin, and this is not SegWit2x. We tell you what Bitcoin Gold is, how and when the hardcore takes place and what you need to do to prepare for it.

Bitcoin Gold (BTG) is the brainchild of Jack Liao, the head of the Hong Kong company LightningASIC, which also sells equipment for mining. The goal of the project is quite ambitious: to become more attractive currency than the original bitcoin (Bitcoin). And the main way, which is supposed to achieve this, is to try to solve the problem of centralizing the mining by changing the algorithm that ensures the operation of the Proof-of-Work protocol.

To change the algorithm, you usually need a hardcore, and the creators of BTG have decided to follow this path. For their own purposes, they chose Equihash, an algorithm sensitive to the amount of RAM, which is now used for the Zcash crypto currency.

It is believed that in the foreseeable future no one will be able to create specialized hardware (ASIC) for mining through this algorithm, which means that the use of processors and video cards will again become justified, and the production of crypto currency will return to the users' hands.

Developers of BTG also consider pre-mining in the amount of up to 1% of the total number of tokens. It is not yet clear how this idea will be realized, but its meaning is probably to transfer part of the reward for mining to developers. The total number of BTG tokens should not exceed 21 million coins.

What is the point of resistance to ASIC?

ASICs are specialized integrated circuits. They differ from processors in that they can perform only one task - but they cope with it very, very well.

At present, bitcoins are almost entirely under development on ASIC, mainly on Bitmain, Bitfury and Canaan devices. In many respects this is due to the fact that the algorithm Proof-of-Work in the network bitcoin (SHA256) is quite simple and does not require a significant amount of RAM.

Equihash, by contrast, is a fairly complex hash algorithm, which requires a lot of RAM for its operation. This means that the production of ASIC for Equihash would be much more expensive and would not guarantee a significant increase in the speed of mining.

A conventional processor can work with the SHA256 algorithm with a hasht of about 5-10 MH / s. For the ASIC, the hashreit on the same algorithm will be about 5-10 TH / s - in other words, the mining will occur about 1 million times faster. If Equihash is used, a normal CPU can do a hashing with a hash of about 10-30 H / s, and specialized equipment with a hashtre of about 1000-3000 H / s, or about 100 times faster.

This means that Equihash provides much more equal conditions than SHA256, thanks to the stability of ASIC. Of course, it difficult to predict what decisions will emerge if Equihash mining becomes as profitable, but it can confidently said that the efficiency gain will in any case be much less than for SHA256

The plan of the developers is to choose one of the blocks for the hard-core on October 25, 2017. This does not mean that their tokens will be available on the same day - just a certain block will be "frozen" as part of a new blockbuster, and in the future it will be added to it BTG blocks.

Currently, developers are planning to launch BTG in early November, which means that there will not be new blocks in their blockade for about a week.

The developers of Bitcoin Gold plan to create a test network somewhere in the middle-end of October. Soon after, they will release their software.

What does this mean for me?

The whole story with Bitcoin Gold concerns you only if at the time of the hardcore, that is October 25, you will have bitcoins on your accounts. Then you get exactly the same amount of Bitcoin Gold.

The developers have provided reliable protection against replay attacks, so you probably do not have to worry about it.

However, to access your Bitcoin Gold tokens, you will most likely need to create a separate purse or carry out the necessary transactions manually.

In principle, if Bitcoin Gold turns out to be cheap (less than 0.0001 bitcoins or so), you probably should not do anything at all. If the course turns out to be more attractive (say, 0.01 bitcoins or higher), purse developers will certainly create tools that will allow you to quickly access Bitcoin Gold.

If your bitcoins are stored on the stock exchange, most likely, sooner or later it will give you access to your BTG. This is especially likely if the new currency will cost more than 0.01 bitcoins.

Of course, it is better to manage your personal keys yourself, as this gives you maximum flexibility, but in principle, to transfer to you your BTG - the fiduciary duty of any exchange.

Conclusion

Bitcoin Gold is another hard-core that promises some changes in the ecosystem. If you already have bitcoins, you have nothing to fear - on the contrary, you can get some free money! If you are a purse developer or an exchange owner, this is a completely different story.