Bitcoin’s Hour of Reckoning

SegWit2x: Bitcoin’s Hour of Reckoning

  • The coming scaling-focused code upgrade is without a doubt one of the biggest trials of Bitcoin's existence. Scaling-related problems have long plagued the virtual currency network, and indeed, they have somewhat moved BTC away from its initially stated goal of becoming a globally accepted internet currency, towards being a store of value.

    Most people see Bitcoin as a victim of its own success in this regard: it has become so popular that in its current form, its network is less and less capable of handling its transactions in a timely manner. There are those who believe however that these issues, far from being "problems" are in facts strengths, proving the well-designed nature of the network.

    Still, most people and organizations involved with the currency see a definite need to increase the processing capabilities of the BTC network, and they apparently aim to accomplish it through a set of code-upgrades dubbed SegWit2x.

    SegWit2x is not the only potential solution floated in this regard, but it seems to be the one towards which the community is currently gravitating. In fact, some tests have already been run on the SegWit2x code (yielding some rather scary results as the procedure apparently induced a hard fork in the test blockchain), and the official testnet launched on July 14. Actual SegWit2x adoption begins on July 21, with an August 1 deadline.

    To understand how you should act in face of this developments, whether are planning to invest in Bitcoin or are already have, a few things need to be understood.

    What is SegWit2x and how will it be rolled out?

    SegWit2x consists of two major parts, of which - considering the recently logged test results - the second is the riskier.

    The first part is essentially the implementation of SegWit (Segregated Witness), which is a code optimization that will increase the volume of transactions that can be crammed into the current 1MB block-size, besides a number of other benefits. This section of the code upgrade is what is adopted at the end of July/beginning of August.

    The second part is essentially a hard fork, which is designed to increase block-size from 1MB to 2 MB. This is where things can really go wrong: if there is not enough support on the part of mining pools, this is where a blockchain hard fork can occur, giving birth to another altcoin (Bitcoin Unlimited?) on the secondary BTC blockchain.

    SegWit2x influence on BTC price

    So how will successful SegWit2x adoption impact the price of Bitcoin? If everything is rolled out without hiccups, some hope that in the couple of months following SegWit2x adoption, the price will double. Other are more cautiously optimistic. If there's a hard fork though, the market will determine the price of BTC as well as that of the resulting secondary altcoin.

    What we are quite certain about though is the fact that we're looking at rough seas ahead, with tons of volatility. Those skilled enough will be able to take advantage of this volatility day trading BTC through forex and simplified forex platforms. We do not recommend transferring BTCs in the first part of August though, as losing transactions is quite possible through this period indeed.

    .