16 February 2018, 07:20Bitcoin Hardforks – What Makes the Difference
The first crypto currency that managed to win the success in the Internet was first split into two different currencies on the 1st of August 2017. As a result, the community received two types of Bitcoins – Standard Bitcoin and Bitcoin Cash. Such decision was achieved by the bitcoin investors after 3 years of constant arguments. Fortunately, the new system was warmly accepted by the community. Currently it occupies the 3rd place in top 10 most popular crypto currencies.
Everybody who observed the history of the bitcoin hardfork perfectly understands that the major flaw of the current state of Bitcoin is the impossibility to realize Bitcoin the way it was originally planned. The position of Asian business people who installed giant plants for obtaining Emoney corrupts the original purpose of the Bitcoin – the equality. This issue led to another hardfork of the crypto currency and creation of Bitcoin Gold as a currency that preserves decentralization.
Several differences between the codes of Bitcoin Cash, Gold and usual Bitcoin that it is really impossible to trace the connection. The users are supposed to apprehend what the major difference between currencies is.
One of the basic differences is hashing algorithm. Bitcoin Cash uses the same SHA-256 mechanism that is utilized for Bitcoin. Bitcoin Gold uses Equihash that has been used in another popular crypto currency – Zcash.
Such method was designed to avoid the use of ASIC technologies that is available for rich people but not for average ones. The mining of Bitcoin Gold can be used exclusively on graphic adapters. In some case Nvidia is more applicable than AMD. Such method preserves decentralization in the blockchain structure.
In order to provide the stability of block search, regardless of the total hash rate of the network, the parameter of difficulty is used. This parameter is reviewed on regular basis. Bitcoin and Bitcoin Cash are reviewed once in two weeks. Bitcoin Gold conducts the reviews after each successfully detected block.
Such a frequent review allows adapting the difficulty and splitting the award for miners in a more honest way. It also helps to avoid the situation when the new pool has been established and leads to the increased fund raising of the owners before the moment of difficulty reviews.
Protection Against Repetition of Transaction
The original Bitcoin has got no protection from repetition as for a long period of time the currency was one of a kind. However, after the hardfork took place a necessity to avoid the repetition of the same operation became quite natural.
Such mechanism exists in both BTG and BCH but in somewhat different manner. BCH has marked the transactions with special markers which prove the reference of the operation to a single crypto currency. BTG fixed the identification address of the wallets while BCH didn’t change.
Finally, the exchange rate – that is the point that interests most people. BCH was the first currency based on hardfork procedure and tends to be more stable, while BTG wasn’t accepted so warmly. The entire situation with the rates will be dictated by the popularity among people and applicability in future.
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