Bitcoin is looking increasingly likely to splinter off again in November, creating a third version of the world’s largest cryptocurrency, as miners and developers pursue separate visions to scale its rapidly growing marketplace.
Major industry players, including the bitcoin investor Roger Ver known as “Bitcoin Jesus” for proselytising on behalf of the digital currency, say consensus between opposing camps looked increasingly unlikely. That opinion was echoed by some of the biggest mining pool operators and also programmers — known as “Core” developers — who were instrumental to developing the infrastructure of the original bitcoin network.
In recent weeks, a group of miners — people who crunch complex math problems to generate and transact the digital currency — split off from the legacy bitcoin to use a new version known as Bitcoin Cash. Ver is moving some of his funds into the new offshoot as he anticipates what would be the second split of the currency of 2017. He admits he could potentially benefit from such a schism as more coins are created.
“There’s probably going to be another split between bitcoin legacy and SegWit2X version of bitcoin but that just gives me more coins that I can sell for the Bitcoin Cash version,” Ver said in an interview on Bloomberg Television.
Bitcoin’s popularity has led to congestion in trade, with transaction times and processing fees at one point soaring to records. Debate over how to deal with the problem has divided the trading community, with some proposing boosting the number of transactions in each block that has to be verified by miners, and others advocating for moving some information off the main network.
One faction of the community is pushing for a network upgrade in November, which could lead to a split if no consensus is made. When the split occurred around the beginning of August — with Bitcoin Cash diverging from legacy bitcoin — the digital currency initially slumped 6.8 percent in a two-day slide as investors appeared to discount the value of the new coin. But prices subsequently rallied, surging to a record $4,880.8 by September 1 before China announced a crackdown on cryptocurrency exchanges and initial coin offerings that sent prices plunging 20 per cent.
While an early adopter of bitcoin, Ver has also attracted controversy for his embrace of Bitcoin Cash, which some developers criticise for giving too much power to miners. If another tear occurs in November, it would create a third version of the cryptocurrency and potentially further scatter capital and resources as three offshoots of bitcoin emerge.