The problem with Segwit2X for BTC owners

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Somebody asked me the other day why there was so much heated debate over the upcoming Bitcoin fork. The other day I wrote about what might happen after the fork, but I’d like to clear up some of the confusion over why the fork is happening and why there is something of a turf war in the Bitcoin camp.

However, as I started to write this, a ‘breaking news’ item flashed across my screen from one of the crypto exchanges that I use. It announced that the leaders of the Segwit2X have suspended their plans indefinitely. As a result, Bitcoin shot up in value just after the announcement to touch $7,800, although it has since decreased in value to around $7,300. It seems to have boosted other coins as well, with Dash and Ethereum both showing some impressive gains; ETH has finally gone past the $300 mark.

But, back to the Segwit2X hard fork war. If a truce hadn’t been reached, what might have happened?  The first issue is that there would have been two types of BTC and who would decide which was the ‘real’ one and which one would be allowed to use the well-known BTC ticker symbol. It’s a bit like kings fighting for a crown and one claims they are the real king and the other is the usurper. We’ve seen what happens in history when this situation arises. There is always a war and supporters decide which side they are taking. This is what we’ve been watching within the BTC community.

But, it would have meant a payout to existing BTC holders. For example, Coinbase, one of the biggest exchanges announced that it would give every user BTC2x coins to match the amount in their BTC wallet. It sounds like ‘free money’, but, there is a downside.

In the past there have been other forks for Bitcoin Cash and Bitcoin Gold, but nobody considered those as replacements for the original Bitcoin. However, many thought the Segwit2X fork would pitch the new coin against the original and therefore damage the value of the original BTC. That doesn’t sound so good for people who are holding BTC.

Thankfully, this has now become hypothetical again and the original Bitcoin remains the only one. Perhaps Segwit2X will never happen, although in the world of crypto currencies, you can never be sure what is coming next.

 

 

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