A Brief Tutorial on Selling Bitcoin "Gold" or "Cash" for Bitcoin

in #bitcoin4 years ago (edited)

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If you happened to hold any amount of bitcoin at the time of the "bitcoin cash" fork in August or the "bitcoin gold" fork in November, then you are probably already aware that there is some free money available for you to collect. You can collect this money from people who are placing bets on unlikely experiments in new alternative currencies. I wish them the best of luck!

The way this works in both cases is a new currency is based on a snapshot of the state of the bitcoin ledger. From that point on, the two currencies diverge, but your bitcoin addresses are now also valid address on the new chain. On the new chain those addresses register a copy of the same quantity, but the exchange value of that quantity will depend on the success of the new currency. Because I consider bitcoin a more viable currency, I decided to trade these altcoins for bitcoin using a decentralized currency exchange. I have used both Shapeshift and Changelly, and I will comment a bit more on this experience below.

The reason I decided to write this article is that when I went to access my bitcoin gold in the days after the fork, I found that good information was hard to come by. Some on IRC and Telegram seemed to believe that no wallets yet supported the currency, or that the GPU mining node software would somehow be useful. The purpose of this article is to offer a few tips based on what I found useful to know.

First of all, the highly usable and mature wallet app Coinomi has supported both bitcoin cash (BCH) and bitcoin gold (BTG) since almost immediately after their respective forks. The way to access your funds with Coinomi is to create a new BTG or BCH wallet and then either scan or enter the private key using the "sweep" feature. There was some confusion (and this is what threw me off for a couple of days) due to a very minor bug. For bitcoin gold, if your funds are in bip38 encrypted paper wallet as mine were, Coinomi will not successfully decrypt the wallet. Instead you will have to decrypt the private key yourself and copy or scan the decrypted key in. An easy way to do this is to use bitaddress.org. For some reason I did not have this problem with sweeping the wallets for their corresponding bitcoin cash funds, just for bitcoin gold.

After you sweep your private keys, you will likely want to trade the accessed altcoin funds for a more viable currency such as bitcoin, ethereum, litecoin, or zcash. In my case I went with bitcoin. At the time of this writing ShapeShift supports BCH (and many other currencies) but does not support BTG. Changelly however does support BTG. My experience using these tools was that Shapeshift has lower fees and faster exchanges, so I would favor Shapeshift. However Changelly being the only option to use for BTG, was also a pleasant experience to use. Both of these decentralized exchanges require that the user be prepared to enter a destination address. Any bitcoin wallet will do for this. One word of warning is that it is very important to select the correct currency, because if you try to send your BCH or BTG directly to a BTC wallet for example, it will be accepted as a valid address but the funds will be lost. Only send funds to addresses of the same currency, and use Shapeshift or Changelly to do the trade for conversion and transfer to the desired currency.

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very good.......................wonderful

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