Bitcoin - Prepare for War! Part 2
Welcome my Steemit friends. Big Changes are coming to Bitcoin. You need to prepare and be ready!
There is much talk about changes coming to the code of Bitcoin. Like Ethereum which split into two coins, the other one being Ethereum Classic, Bitcoin could split.
Source:
FirstSteemit Article - Bitcoin - Prepare for War! 1
As you watch the arguments over who has the better changes you need to pay attention to the timeline in which changes will occur as it will affect the value of your Steem. Fortunately, as an owner of Steem, Steem is also tied to Ethereum!. You can trade Steem for Ethereum.
Today a consensus was reached by all miners, mining hardware companies, and mining pools to implement the UAHF, User Activated Hard Fork. This will include SegWit2x. A Segregated Witness hard fork that increases the Bitcoin Block size to 2 megabytes.
Many people do not know what miners, or Segregated Witnesses do: they process the transactions. In Bitcoin and all other cryptocurrencies, a transaction must be processed more than one time to verify that the processing of the transaction is correct. The miners who perform the secondary reprocessing of a transaction do not get paid for it. If the secondary reprocessing transactions do not occur correctly, a block is labeled orphan and is discarded. No one is paid for an orphan block.
Who Are The Sides In The War?
- Bitcoin Miners, Mining Hardware Companies, and Mining Pools - they agreed today to a consensus for SegWit2x - they will do that.
- Bitcoin Developers - those who write the software. There are several camps - the main one is SegWit or BIP 148, a soft fork.
- Bitcoin Users and Merchants
Why Are They Fighting?
Source: coindesk.com
- Speed and Cost of Transactions
- Centralization versus Decentralization
- Block Size
- The Ability to Add Additional Software
- Control over Bitcoin
- Return on Investment, especially those who have invested billions
Source:
This is the beginning of the timeline , so in just two weeks.
July 21st 71 % of the mining pools will use 80% of processing power to test SegWit2x for 3 days.
July 31st Segwit2x will be locked in by all miners, pools, and mining hardware manufacturers
Meanwhile, a group of developers plan to go ahead with BIP 148 which is SegWit with a one megabyte block size with a soft fork.
For those who do not understand what mining is - Mining is the processing of transactions. Miners run cryptocurrency networks like Bitcoin. Their machinery is what powers the network.
Originally...
Cryptocurrencies like Bitcoin could originally be mined on your cell phone or your personal computer. That is the way most were designed. The first switch for speed was when a graphics card and the processors or computer chips in the graphics card were reprogrammed to mine. Miners are paid a reward when they solve a transaction called a block.
There was one transaction per block. The new forks will have larger blocks which include many transactions. Solve one 256 SHA encryption and many transactions are processed. This also reduces costs for miners who do not get paid for mining solve blocks again to ensure the block was mined correctly. Costs should be greatly reduced. Speed and transaction reliability should be increased to meet the demand of the large number of people, merchants, governments, and businesses that are adopting Bitcoin as a secure method of internet transactions.
What Is Wrong With That?
Source: cryptocoinsnews.com
There really is nothing wrong with the idea. Bitcoin already made the size of the block 1 megabyte just a little while ago and Bitcoin became very fast again. However, some day there will be no more coins for Bitcoin Miners to receive for solving the transactions. When that happens, there are a couple of choices:
- All the miners go broke
- The number of Bitcoins is increased
- Decrease the number of blocks by including more transactions in each block. This way, there are less blocks, a lot less, and it will take much longer for the number of Bitcoins to run out. Originally, it was predicted that would happen in the year 2040. Now, with a 2 megabyte block size or even a one megabyte block size expect the year that Bitcoin runs out of rewards to miners to extend far into the future.
Why? A bitcoin block was 12k. Now the block is 85 times larger and includes roughly 84 more transactions. All of a sudden, the whole system grows like a missile in terms of speed and scale.
Source: newsbtc.com
If the miners go broke, oddly there will be no real effect on Bitcoin. Your computer or phone not competing with huge banks of dedicated mining computers will solve the transaction but probably not as fast. How much slower? That part is hard to say.
One advantage is that Bitcoin will again be completely decentralized. That bad part is how big will the database be? Most people place their cryptocurrency wallets with a company. Why? In order for you to download and run your own wallet the amount of data is insane. Bitcoin's blockchain is 100+ Gigabytes and growing every second. That is about 25 DVD's.
After you download just one wallet, your computer must process the data and then your wallet is up and running. That can take days. We just went through that with the Steemit Hard Fork.
Good news - Steem is worth a lot more. Bad news, it took a month
The same thing could happen with Bitcoin although it is not predicted to take place. Why, one of the changes being proposed is the Segregated Witness that is used here at Steemit. Litecoin just did this last month. They have reported no problems as of the June 14th. The Segregated Witness fork know as SegWit was successful.
Bitcoin Developers Want SegWit - Miners Want Segwit2X
Source: qzprod.files.wordpress.com
BIP 148 Implements SegWit and will be right around July 1st. The miner consortium say they will put in the UAHF if BIP 148 is implemented to stop the change. Most people say the miner consortium is bluffing especially after LiteCoin and its successful implementation of SegWit.
The next change might be July 31st!
BIP 148, is now redundant and outdated before it is implemented if the miner consensus succeeds in plans to implement SegWit2x.
During these times, Bitcoin could become very volatile. Already it is moving about $200 in price several times throughout a day.
Those of us who were with Steemit when it Hard Forked know that serious changes occurred and one thing that happened was no one received any awards of any decent amount for awhile. It was tough and it was tough to stay motivated to post. It was also a great time for a vacation from posting.
So, what if the miner consortium tests SegWit2x on July 21st and it chokes? What if all sorts of problems occur and it cannot be implemented before BIP 148?
Why are these changes coming?
- Speed
- Efficiency
- Cost
- Decentralization (This might be number one!)
What You Can Do
- Watch the Markets
- Know your Avenues of Escape
- Be Aware that fairly soon, just like with Ethereum, LiteCoin, Dash, Monero...and so many other coins - Once a change is accepted they could rebound so fast and jump in price so high that you lose big. At the same time, if you can time it right up during the period before the forks are implemented the swing market could make you rich!
Just know that this will be a period of time where no one knows what the outcome will be. There is great experiment to meet the needs of people like myself, business, and government who do not want to be hacked anymore.
As to whether or not the cryptocoin world will crash and burn in bubble? Doubt it.
Source: @jeff-kubitz
What should you do: if you are afraid, sit it out! Turn your coin into cash or some other coin.
You can wait until the market seems safe again and all software changes are A-OKAY!
As for me, I am riding the roller-coaster. I literally have nothing to lose except tokens that represents money and everything to gain.
Last but not least: The reason the internet has problems is because people do not understand that money is a physical thing. Not money, not anything but 1's and 0's can be sent over the internet in a digital square wave signal. Those 1's and 0's have not been secure and so people, businesses, and governments have been robbed and bent over the coals to burn.
Cryptocurrencies are encrypted number systems of vast complexity that the average person, even a hacker cannot decrypt. That is why they are much more safe.
Note: Today, I may have lost Steem and Steem Dollars in a transaction. But then, it is still there in the wallet of who I sent it to so I should be able to get it back or it will continue to be sent and finally arrive.
GOOD LUCK!
Don't invest if you cannot afford to lose it!
Steem and SBD Deposits Waiting 3 Hours- today 05-19-17
Series Parts:
Bitcoin - Prepare for War! Part 1](https://steemit.com/bitcoin/@jeff-kubitz/bitcoin-prepare-for-war-part-1)
Bitcoin - Prepare for War! Part 2](https://steemit.com/bitcoin/@jeff-kubitz/bitcoin-prepare-for-war-part-2)
Bitcoin - Prepare for War! Part 3](https://steemit.com/bitcoin/@jeff-kubitz/bitcoin-prepare-for-war-part-3)
Article Sources:
Game of Bluffs? With UAHF
Litecoin Foundation Reports 'No Issues' Since SegWit Activation
Bitcoin Scaling: How to Give Everyone More Control
Bitcoin Scaling Proposal Segwit2x Moves Ahead With Initial Code Release
Bitcoin Miners Unite Behind Scaling Proposal Segwit2x
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How do we position ourselves for tomorrow's hard fork here on Steemit...? What's the recommended procedure...power everything up, or keep it where we have it...?
Well, on Steemit you can try to shift your Steem you have powered down to sell to another currency or your Steem Dollars but unfortunately you cannot power down Steempower to get it out faster that 12 weeks.
So, vote for the witnesses that seem to be concerned with your assets you earned for posting. Some might be less than ethical and might even be evil by nature and you should vote those people out. The American people have tried that with more than one congress that refuses to ...you ask an awful lot for a few pennies of reward that took years of mining, software programming, virus fighting, and so on. No system is perfect, sometimes you just have to ride it out.
I didn't realize I was asking that much...but thanks for the reply all the same.
Thank you for sharing!
;-)
Some good information in this Post. As always. Thanks for sharing.
Exciting times we live in!
Excellent post dear friend @ jeff-kubitz big questions, let's hope it does not make many waves and that everything goes well, while it will be an uncertainty.
Thank you very much for all this material
I'm with you dear friend @jlufer. I hope it works out
Wow... Things are gping to be that big... For now, let's wait what would happen then.
; -)
Excellent post dear friend @jeff-kubtz
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Thanks @screenname