Segwit2x fork may cause Bitcoin price to rise, South Korea's largest Bitcoin community is dissatisfied

The exchange Bitfinex price shows that Bitcoin hit a new high of $5,900 on October 13. Bitcoin broke through the $5,000 mark for the first time in early September and then plummeted. On September 15, it lost the $3,000 mark and then rebounded, with a monthly increase of more than 90%. As of press time, the price of Bitcoin is $5,685.

As for the reasons for the surge in the price of coins, the most hotly debated issue at present is the Bitcoin hard fork next month. As the transaction volume on the blockchain increases and the capacity of the blocks is limited, network congestion and transaction delays have been caused. Hard forks are a phenomenon that occurs after the scale of Bitcoin has expanded to alleviate network congestion. On August 1 this year, the Bitcoin blockchain hard forked to create Bitcoin Cash (BCC), and the new virtual currency will be developed on the branch chain. When BCC is launched, Bitcoin owners will receive BCC at a 1:1 ratio without paying any fees. The price of Bitcoin rose before and after the hard fork in August. Based on the experience of the price increase and the gift of new coins, the news of the hard fork in November may be the reason for the rise in the price of Bitcoin.

Segwit2x has taken over the development project of this hard fork. In August of this year, Segwit2x announced that it would allow Bitcoin miners to run new software on block 494,794 on the chain in mid-November. Earlier, Bitcoin.com reported that Segwit2x was developing Bitcoin Gold as a virtual currency after the hard fork, and it was launched on October 25. Currently, the development of Bitcoin Gold is not completed and is quite controversial. The biggest controversy is that developers can mine in advance, and members of the Bitcoin community are dissatisfied with the development rewards. Developer Kuhne said: "We have heard a lot of feedback from the community, so this project will be replaced by an upgraded plan. But it does not rule out more moderate developer incentives for early mining."

Currently, the trading website Bitfinex already has futures trading for the new currencies BT1 and BT2 after the Bitcoin Segwit2x fork.

In order to solve the problem of network congestion, 56 blockchain startups from 21 countries signed the "New York Consensus" in May this year to expand the block capacity from 1M to 2M. Currently, the capacity of each block is 1M. According to the Bitcoin network theory, 1M can support up to 7 transactions per second, and an average of one block is generated every ten minutes.

According to Cryptocoinnews, the Seoul Bitcoin Meetup, the largest Bitcoin community in South Korea, sent an open letter to the New York Consensus, asking its members to stop supporting Segwit2x's hard fork plan in mid-November. The open letter listed complaints against the Segwit2x hard fork project. The Seoul Bitcoin Meetup believed that the Segwit2x fork project did not follow the very ethos of Bitcoin, did not strive for community consensus during development, and had the risk of splitting the Bitcoin community. It then criticized the developers for not giving the entire ecosystem enough time to prepare for the upgrade. Currently, Segwit2x does not have an automatic replay protection embedded in it to separate the old and new blockchains and prevent attackers from publishing transaction information on both chains at the same time.

Another controversy over the "New York Consensus" is that it may lead to centralization. The founders of Bitcoin intended to provide a decentralized and secure transaction network, but once a hard fork occurred, the block size was expanded from 1M to 2M. When 2M could not meet the demand, the block size continued to expand until ordinary private computers could no longer run the entire blockchain, and all computing power was concentrated on miners. Miners can rely on the computing power in their hands to weaken the blockchain's original security model of minimizing trust between users, which was maintained by all nodes, leading to the centralization of the blockchain network.

The Coindesk website analyzed the impact of hard forks on the price of coins. Arthur Hayes, who used to work at Citigroup and currently works at a virtual currency exchange, said in an interview that investors’ confidence that hard forks will not affect the long-term returns of Bitcoin is the reason for the rise in the price of the coin.

Last year, Ethereum split into two currencies, Ethereum and Ethereum Classic. At first, the prices of both currencies fell, but then the price of Ethereum rebounded. Today, at 13:00 Beijing time, Ethereum will fork out the "Byzantium" coin.