Bitcoin Retreats as Another Cryptocurrency Offshoot Appears

A new iteration of the most popular cryptocurrency bitcoin has been formed after some developers split the blockchain, according to Bloomberg. Called bitcoin gold, the offshoot comes less than three months after bitcoin cash was created.

While independence from any central authority is part of bitcoin’s appeal, that’s also made it more susceptible to such so-called “hard forks“ when there are differing visions within the cryptocurrency community. Bitcoin gold aside, bitcoin miners and developers have been embroiled in a debate lately over an upgrade of its protocol that’s aimed at speeding up transactions. A lack of consensus is threatening yet another schism next month.

“This is what will be required to make fair mining accessible to the general public once again,“ said Robert Khune, a strategist at the Bitcoin Gold project. "A successful fork will prove that bitcoin always has the ability to escape from any potential abusive mining hardware manufacturers," who he blamed for "unnecessary stalling" this year.

Bitcoin dropped 4.4% yesterday morning in New York, paring a decline of as much as 5.9%. The cryptocurrency is still up 36% this month and about sixfold% this year.

Bitcoin gold’s main innovation makes it easier for people without special hardware to mine the digital asset, according to its website. Instead of powerful mining machines called ASICs used in bitcoin, users can mine it with standard gaming graphics cards, similar to how mining is done with ethereum, the website says. After the split, bitcoin owners stand to receive one bitcoin gold for each bitcoin, assuming their wallets or exchanges support the new creation, it said.

Further splits may be imminent. One faction of the community wants to increase bitcoin’s blocksize in order to shorten transaction times, while another is opposed. The first phase of this plan, called SegWit2x, was implemented in August and took some of the data off the main network.