If I had a tiny crystal ball, I could tell you if the 30 billion dollar bitcoin meltdown will continue. I could predict when to sell, when to buy and when to hold. But I don’t have even the tiniest of magical crystal balls — and neither does any other Bitcoin Jesus.
Bitcoin’s “potential” fork in the road is near. A few weeks, maybe sooner. Experts in the field are uncertain if bitcoin will survive in its current form — or any form. Traditional money-changers will shrug if it collapses. “We told you it was a bubble — it was funny-money.”
If bitcoin fails, billions of dollars could be forever locked away. Those who made their millions from the cryptocurrency will no doubt soldier on, creating new tech and innovating — all because bitcoin opened that door.
In the meantime, say in a few days, the large cryptocurrency exchanges might need to explain that all of their cryotocurrency accounts are okay, but they only have pre-SegWit bitcoins. Outfits like Bitfinex, Coinbase and Poloniex could freeze all bitcoin accounts until the storm blows over. Then the lawsuits would begin. If you think it won’t endanger your back-up crypto, think again. Think about saving your cryptocurrencies offline or in a wallet you completely control. Then hope. And wait. (I am.)
On the scale of things, bitcoin isn’t even a blip — when one focuses on the amount of money being flung around the world each day. It’s chump change compared to JPMorgan Chase or Barclays, but then they don’t get it do they? They don’t understand the idea behind bitcoin at all. The idea behind any cryptocurrency. If they do understand it and wish to keep their wealth, they are busily working to destroy it — or copy it. Thing is, they will always be behind. Innovators are even now working to improve fintech. In a few years the banking industry will again need to re-educate themselves or risk being heaped into the dust bin. Hundreds, if not thousands of years of traditional banking — the stuff that money is made of — is being rewritten.
At first glance, some might think that a back-up cryptocurrency is in order — another cryptocurrency to set aside, while bitcoin goes through its latest convulsions. Litecoin comes to mind. Maybe Ethereum. Perhaps instead, we should focus on the newest developments or what are called “Third Generation” crypto’s. Iota comes to mind. No doubt, the choices are difficult.
But the crypto-markets as a whole are deflating, suggesting that this isn’t over yet.
Colorful personalities such as Jeff Berwick have chimed it on the matter. Comedy seems to be the order of the day. Just another update. Don’t worry. Time to poke fun at the entire process. You can do that when you have loads of pre-halving bitcoin profits.
Berwick is apparently comfortable in the knowledge that all will be well — soon. That bitcoin is the “King of Crytocurrency” — period. At least for now. Oh, and if you do follow this “personality” you might want to check out his latest post about the Moon Landing having been faked. Great, comedy and conspiracies. Is he credible at all?
All joking aside, Bitcoin Magazine might be one of best sources of information. They delve into the specifics. Get in the weeds.
Here’s a recent article from Bitcoin Magazine that will fill you in:
Bitcoin miners at large have missed the first BIP 148 “deadline” to prevent a “split” in Bitcoin’s blockchain.
The article tells us that the first bitcoin deadline — when the miners should have taken action to show “solidarity” — has passed. “The miners at large” have not acted to install the recommended updates. This news helps us understand what is actually happening in the cryptosphere. Obtaining our news from CNBC, at the sound-bite level, can be annoying, if not misleading.
But the digital details may not matter to the “man on the street.” He just wants profits — stability — or a way to stick it to the real man. And that is just a side benefit, for now. Since bitcoin, for all intents and purposes is public and prying eyes are always a concern.
As a result of this apparent bitcoin “miner” inaction and other factors, the value of bitcoin is still dropping as of this posting. It is heading for the $1800 mark. The next psychological level — and you’ll hear about this soon — is the value of one ounce of gold. Once bitcoin touches that number, people will expect a reaction. Either a bounce of affirmation or the other thing. If the other thing occurs, then you will read about bubbles. About bitcoin diving to 30 dollars each, then pennies each, then you won’t hear about bitcoin any longer.
Right now, the 30 billion dollar question is, has the bitcoin community at large already signaled that Bitcoin Core is no longer in touch with the users themselves? If this is true, are we now staring at the “fork of failure?” Or are we reaffirming our trust in the backbone — the miners — of the bitcoin system?
If we follow the miners, where will they take us? Down commercial roads, where large corporations and their Nanny-State governments dictate policy? If we follow Bitcoin Core, will this latest software “patch” suffice until the next critical juncture? Still keeping the community safe from the ever growing centralization of control? It seems that we are damned either way.
What is curious about the article in Bitcoin Magazine is that if bitcoin does fork and the powers that be decide, belatedly, to go ahead and allow the updates to commence — they could reunite the blockchain. In other words, having bluffed and lost, the miners and Bitcoin Core could have a “coming to Jesus” moment after they look into their respective digital wallets and discover that they are holding worthless numbers. But they better not wait long to reunite, because every second they delay, trust is evaporating.
In the event of a temporary fork there will still be significant disruption for the users, of course. It would be like keeping two sets of books. Eventually, if the blockchain is mended, only one set of books would be accepted. And therein lies the problem. The other set of books — all of the transactions, purchases, trades and the like — would be nullified. Users could potentially lose millions. Maybe more. Again, trust would be seriously eroded.
I don’t even want to think what would happen if bitcoin permanently forks. The cascade effect would certainly push many other cryptocurrencies into an unrecoverable downward spiral. We couldn’t really say if both bitcoin blockchains would have value. In such a dual-bitcoin scenario, no doubt both bitcoins would attempt to retain the title of “bitcoin.”
And if bitcoin forks, would not every blockchain born cryptocurrency become immediately suspect? Risky.
The other side of that Crypto-Armageddon is that a new coin could be born. Meaning the old guard — Bitcoin Core — could be left behind as Bitcoin Unlimited, for example, moves on with all of the “customers.”
Eventually, blockchain tech will be replaced. All tech is updated. The question is when?
A prediction would be that bitcoin prices could be touching gold price territory within the week.
Thanks for stopping by.