It was another hard fork day on May 15! Bitcoin Cash is creating a new blockchain with 32MB block size limits and added smart-contract functionality. This is the third hard fork that the Bitcoin Cash community has undergone in under a year, and declares their undeterred commitment to change whatever necessary to grow their blockchain’s transaction abilities. Bitcoin Cash strives to provide an inexpensive and fast medium of exchange for everyday payments.
A ‘hard’ fork refers to software changes that require the creation of a new blockchain from a previous one, whereas ‘soft’ forks can impute software updates without the creation of a new blockchain. A hard fork, therefore, is only implemented when there need to be changes made at the most fundamental level of the blockchain architecture; the consensus protocol layer.
A Bit of Background on Bitcoin Cash
Bitcoin Cash was born out of a hard fork with Bitcoin’s blockchain last summer. After much debate amongst various parties of the Bitcoin ecosystem over how to scale the Bitcoin network, a group of developers organized under the name ABC Bitcoin, wrote the code for a hard fork to create a new blockchain with 8MB block limits. On August 1, this new code was implemented to copy the entire Bitcoin block history onto a new network to begin mining its own transactions separately, as a distinct currency and under different mining parameters. Bitcoin Cash promises to be a peer to peer cash system. This system should be popular in areas where the traditional financial system has been unable to reach the unbanked.
In the case of last summer’s hard fork, not only was a new blockchain created, but also a new coin was introduced to the market to represent value exchanged on this new transaction ledger. However, not all hard forks create new coins. For example, Bitcoin Cash hard forked again last November to fix their algorithm adjusting mining difficulty because the network was producing wildly fluctuating hash rates.
To patch the system, various developer teams running different clients on the Bitcoin Cash blockchain agreed to implement a hard fork where they all copied the old ledger onto a new chain, with the software updated, and abandoned the old chain. Although technically November was also a ‘hard’ fork, it was obviously very different than the previous split in community generating not only a new blockchain, but also a new network, and a new coin.
However, it shouldn’t be understated that blockchain developers, including Bitcoin Cash, treat hard forking with caution, it’s a delicate process with potentially serious financial consequences. Though while many in the community treat hard forking with outright fear, this is a key part of how Bitcoin Cash operates, so the Bitcoin Cash community is not afraid of hard forks.
What’s New with the Latest Hard Fork?
This time around is more similar to the November hard fork but slightly different. Today’s fork neither creates a new coin, nor does it correct an existing problem, but rather strictly innovates in two ways. The first major change is the tripling of the block size limit from 8MB to 32MB that is a forward-looking adjustment to accommodate greater transaction throughput per block. I feel better that this block size growth is occurring now, while the usage of Bitcoin Cash still has a way to grow, rather than later when the network is at full throttle.
This the larger block size gives Bitcoin Cash some room to scale, something that other blockchains have been looking to tackle in other ways, e.g., Lightning Network and Proof of Stake. This makes Bitcoin Cash somewhat unique because it attempts to solve the scaling problem at the consensus protocol layer while maintaining the Proof of Work model.
However, larger blocks will not in effect grow the network regarding usage. It does, however, provide the ability for unprecedented growth. Growth in usage depends not on the block size but more on the community and businesses supporting Bitcoin Cash. Products, services and merchant adoption are key. After the block-size increase, the next advancement that Bitcoin Cash is putting forward is to add new and re-enable old, previously inactivated, machine-scripting operation codes, or more simply ‘op-codes,’ that give developers tools to create smart contracts.
These machine codes, called “Satoshi Op-codes” by the Bitcoin Cash community, allow developers to create different types of metadata implementations. By having the ability to call these functions, developers can create “colored coins” or representative tokens. These are tokens that can be tagged in a specific way to correspond to bonds, stocks, precious metals, commodities, and any physical or virtual object.
It is hard to say what might come out from this new functionality, but if we base our assumptions on what Ethereum has been able to accomplish from its second layer implementations, then I believe it will give Bitcoin Cash a lot of space for creative and productive ideas to blossom. To that end, we shall have to see what the developers of the Bitcoin Cash community do with these new functionalities and if the market decides to settle in this newfound block size that has yet be driven to scale.
Australians Can Pay Utility Bills With Bitcoin (BTC)
Bitcoin (BTC)–In terms of adoption for cryptocurrency, being able to pay for real world goods and services with the digital currency has long been viewed as the gold standard. The bear market of 2018 has led to a shift in focus away from the fundamentals of crypto and the usability of blockchain transactions in favor of wild price speculation. However, an Australian-based partnership is attempting to provide a solution for customers looking to pay their utility bills with cryptocurrency.
Cryptocurrency exchange Cointree announced a joint-venture with billing platform Gobbill to give Australian customers the opportunity to pay their utility bills with cryptocurrency. The goal of the union is to provide a solution for automated billing via crypto, with Gobbill functioning as the intermediary in the exchange, taking user funds in crypto and making the payment in fiat.
Using the Cointree wallet, users of the cryptocurrency exchange will be able to convert stored coins automatically into utility bill payments, giving customers the opportunity to pay in BTC, XRP, and nearly 40 other currencies. While Australian utility companies will not be accepting crypto directly for payment (the exchange involves a conversion to fiat), it does represent a way for Australian crypto users to get around having to cash out of their denomination on exchanges to free up funds for utility payment. The service is being aimed at small businesses and average investors, with the co-founder and CEO of Gobbill, Shendon Ewans, expounding upon the planned form of payment,
According to Ewans, Gobbill views this partnership with Cointree as getting ahead of the curve, a refrain we have heard several times from tangential businesses attempting to capitalize on cryptocurrency. By offering a service that automatically takes payments in cryptocurrency, Gobbill is exposing itself to the growing, and vocal, userbase of cryptocurrency, in addition to paving a future for their company that involves a takeoff in the digital currencies.
Cointree also sees partnerships for bill payments and automatic drafting as a way to increase their customer base, with efforts already enacted for several years on the front of crypto-to-bill payment. Jess Rendon, operations manager of Cointree, reported that the company has processed $100 million in bills paid in 2017,
“Last year alone we had about AU$100 million of bills paid and saw ten times growth in this payment feature.
CCN reports that paying bills with cryptocurrency has seen an explosion in Australia over the last several years, having grown by 3300% in a three-year period. While the system devised by Gobbill is still a step removed from utility companies accepting Bitcoin and altcoins directly, it does provide another avenue for investors looking to use their coins outside of exchange speculation.
Biometric Cryptocurrency Card Protects Bitcoin with Fingerprints
Unikeys has officially announced its UKey cryptocurrency card.
In form, it’s shaped like any other regular payment card. But it’s designed to host multiple popular cryptocurrencies including Bitcoin, Bitcoin Cash, Ether, and Litecoin. What’s more, it features an embedded fingerprint sensor. Once a user’s fingerprint data has been registered and stored in the card’s Secure Element, the card is then able to biometrically authenticate the user for each transaction, ensuring a high level of security.
The biometric component is the product of a collaboration between Unikeys and Hong Kong-based MeReal Biometrics, which obtained its fingerprint sensor technology from Sweden’s Fingerprint Cards. Fingerprint Cards has been very busy in recent months seeking to secure a leading position in the biometric cards market as major financial services brands like Visa and Mastercard prepare for mass commercialization of this kind of technology; Unikeys, for its part, is ahead of the curve.
Of course, a key to success for the latter company will be establishing merchant support for its card’s cryptocurrency payments, and as RFID Journal reports, Unikeys is currently in talks with “several companies” concerning this issue. Unikeys’ CEO says the company is also planning to launch a pilot for its solution in Hong Kong, though details about the project are forthcoming.
Bitcoin This Week: Square’s Cash App Extends BTC Services, Bitcoin Adoption Years Away And More
Today on Bitcoin This Week we comment on Square’s Cash App recent announcement of extending its Bitcoin services to all Americans, we discuss Coinbase CEO comments on why he thinks Bitcoin adoption is years away and much more.
Saudi Committee Leaves No Doubt About Bitcoin Status
Saudi Arabia has reminded its citizens that trading in Bitcoin and other digital assets is expressly forbidden in the Kingdom, citing Bitcoin’s “high risk” and, what it terms as “negative consequences” for investors.
There were certainly negative consequences for investors this week, with Bitcoin falling back to within touching distance of its lowest 2018 price, before recovering on Wednesday. The paternalistic Saudi government, meanwhile issued its warning through the “Standing Committee for Awareness on Dealing in Unauthorized Securities Activities in the Foreign Exchange Markets” pronouncing it was doing so to protect its people from “get rich” schemes and the dangers of transferring funds to unknown recipients.
Bitcoin Settling More Transactions Than Gold
Bitcoin, as everyone knows, has dropped in price considerably since the start of 2018. It might surprise investors to learn, therefore, that in terms of settled transfers, the cryptocurrency is outpacing gold.
Nick Carter, a researcher at Coin Metrics, published statistics on Twitter comparing Gold settlement volume so far this year with Bitcoin. He used the statistics of the London Bullion Market, stating that it represented at least 70% of all gold traded globally. It would appear that the Gold market is likely to complete under $500 billion transfers this year. Bitcoin, however, has already transacted over $800 billion worth and is well on course to exceed one trillion dollars in settled transfers by the end of the year.
We Are Years Away From Bitcoin Adoption – Coinbase CEO
In crypto adoption terms, the world is roughly where it was with internet adoption back in 1998 according to Coinbase CEO Brian Armstrong. Speaking to Forbes, Armstrong was bullish about cryptos chances of succeeding in countries that are experiencing turmoil, such as Venezuela and Turkey, but said that we were years away from being able to use Bitcoin and other cryptocurrencies on a day to day basis.
In Armstrong’s opinion, only around 10% of Bitcoin produced is used in real-world settings, citing video games as a specific use case where cryptocurrencies have seen a reasonable level of adoption.
Square’s Cash App Now Offering Bitcoin To All Americans
Coinbase will see increased competition in the United States with the announcement this week that Square’s Cash App has extended its Bitcoin trading services nationwide. It had previously only been available in some U.S. states.
Cash App allows users to send money easily through a simple cellphone app. It received a license to offer Bitcoin services to New Yorkers in June, having recorded a positive response to its crypto services. Unsurprisingly, the announcement that Square had expanded its services nationwide was made by tweet as Square CEO Jack Dorsey is the co-founder of Twitter.
Markets – Almost Rock Bottom For Bitcoin
There was some relief for Crypto markets on Wednesday after an early week meltdown sent the market spiraling downward. Bitcoin was far from being the worst affected however, and by Wednesday had largely recouped the losses suffered in the previous couple of days. But its value, even with this recovery, was almost $2000 down from late July.
On Sunday, Bitcoin opened at $6283, and closed up at $6322. Monday saw a sharp decline when it hit $6225. But worse was to follow. On Tuesday, the crypto market was in freefall, Bitcoin trading for under $6000 for the first time since late June, closing the day having recovered to just under $6200. Wednesday was better, with a steady upward curve sending the coin towards $6500 around noon. To see current prices click here.