A one stop place for all the answers about what's going on with Bitcoin right now and next week.
The long standing (not over) Bitcoin scaling debate:
Let's begin where it all started. For several years now, Bitcoin users and miners have noticed that fees to send Bitcoin from address to address were increasing. This happens as more people use Bitcoin because the network must be able to handle more transactions. Currently, transaction speed is prioritized by the fee the user chooses to attach to the transaction they are attempting to send; higher fee, higher transaction speed.
A cycle began to develop by which users who wanted faster transactions began to attach more fees until the fee price reached a peak earlier this year. If a user wanted a Bitcoin transaction to occur within a few hours, the fee was over $10 per transaction. Obviously this prohibits small transfers and creates a problem for some Bitcoin businesses who require low fees to operate.
Many would say, of course, the solution is simple, increase the amount of transactions the Bitcoin network can handle, thereby reducing the fees and speeding up the network. Clearly this would be ideal, but there are drawbacks to doing this. The first of which would be that increasing the transactions the blockchain can handle means increasing the size of the blocks placed in the chain.
Increasing the block size directly decreases the amount of computers operating the Bitcoin network around the world the can handle the increased network requirements. This decreases the decentralization of the Bitcoin network, the exact opposite of what was intended by the creation of Bitcoin in the first place. Another solution needed to be devised.
Segwit: A Compromise Among the Feuding
This new solution would take the form of Segregated Witness (Segwit). Segwit is a decent attempt to please all. Segwit does not directly increase the block size itself, rather it compacts the transactions more tightly into the existing block structure, thereby increasing the throughput of the network without sacrificing decentralization.
Bitcoin Improvement Proposal (BIP) 91 is a proposal set forth earlier this year that intends to implement Segwit and at the time of writing this, has been successful is achieving overwhelming miner approval, signaling a confirmation for activation on August 1st.
BIP-148 is a second competing proposal that would reject all mined blocks failing to signal for Segwit. At this time, it appears this that BIP-91 will lock in and BIP-148 will be a non-issue. If all miners are on board, there will be no need to reject any blocks, therefore, nothing will happen.
Bitcoin Cash: An Emerging Oppositional Bitcoin Chain
Now back to the opposition to Segwit. Bitcoin Cash (BCC) is the competing fork to Segwit and intended to split from Bitcoin on the 1st of August as Segwit is implemented. Upon completing the fork, Bitcoin users will have both Bitcoin and Bitcoin Cash. BCC intends to remove the Segwit implementation straight away and instead opt to increase the block size by 8 times Bitcoin's original value, from 1MB to 8MB.
Many may want to discount BCC, but ViaBTC is offering future delivery of BCC (on August 1st), and currently trading at ~$500 per coin at the time of writing this. This means that should both BCC and BTC maintain their value through the fork, users will effectively gain a free $500 per BTC. Market dynamics are still in play however, and it can be assumed that both or one will lose some value upon the fork, much like Ethereum and Ethereum Classic last summer.
Again, to be clear, Bitcoin users who hold Bitcoin through the fork will get Bitcoin AND Bitcoin Cash.
Here are five easy ways to get the coins that are coming to you:
Place your BTC in your Trezor hardware wallet before the fork (if you have one) and update your firmware after the fork is completed.
Here's a thorough guide to preventing coin loss during the fork using Electrum wallet.
If you prefer the non-technical approach, Bittrex is guaranteeing customers who hold BTC at the time of the fork will receive BCC. A solid option for small BTC amounts as Bittrex has a decent reputation within the crypto community.
Another sound option: Bitfinex, the longstanding Shanghai based Bitcoin exchange, has issued a similar guarantee to issue their customers BCC once the fork is completed.
For those who use Kraken Exchange, you're also being greenlighted for BCC credits.
There are plenty of options to choose from, none is a bad choice. Trezor is likely your best bet for large balances of Bitcoin as it extremely secure, though it may be too late to get your hands on one before the fork.
Technical Analysis for Bitcoin as it stands now:
If you've read this far, it is clear to you now that the fundamental analysis of Bitcoin for the immediate future is a mine field. Fortunately, technical analysis has a few clues about what is going to happen with Bitcoin's value. First, the daily chart, shown below:
This chart is full of bullish indications:
In the blue square, the lagging span of the ichimoku cloud has risen above the previous price range, the price is above the cloud, therefore we can lean to conclude the up-trend is intact.
In the red square, the ichimoku's the Kijun-Sen crossed the Tenkan-Sen inside the cloud and the price has crossed the center line of the pitchfork. The odds are high of a continuation that reaches the top of the pitchfork channel, greater than 75%. The price is currently fighting to get over the centerline again. A move that fulfilled this would place the value of Bitcoin at approximately ~$3450 in the shorter term, say a week or two.
In the green square, the cloud has crossed and turned upward. Looking lower, the RSI has broken out of a downtrend and is floating somewhere around centerline, which is midrange. Stochastic is high, but not indicating oversold as it did for a long stretch of April through June.
Conclusion: It may be worth it to hold some Bitcoin in a safe place through the fork
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Is there anything you would like to see added about this subject?
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As always friends, be sure to check back often and click the follow button; my researchers, sources, and I follow the markets very closely and maintain a continuous feed of up to date fundamental analytics you should keep an eye on.
Very well done and timely. You can add Kraken to the list of exchanges who will trade BCC day 1.
Thank you for your support @eeks.
It's good that Kraken has joined in as well.
I have added them to this guide above to ensure everyone has the greatest amount of choices in how to approach the Bitcoin fork.
Great article, i will read it again tomorrow to understand it fully :)
Thanks for this.
Hello Jeffrey, great layout and informative post my friend.
Following you now mate.
Thanks for this informative breakdown about bitcoin etc. Voted, Commented and following you! Cheers
Great article. Concise. Informative. Resteemed and followed. Will be watching for more.
Resteemd indeed
Thx y0u
Followd ;)
..a lot of info, thank you..may you re right..follow you..upvoted..
Nice post. So what happens if you have your BTC on say exodus wallet and it doesn't end up supporting BCC will you ever be able to get your BCC?
You can get your BCC only if you hold your own private keys, or if keep your BTC on exchange or wallet that approves of the split and supports it.
nice article
Thanks for clearing things up :)
Ok, thanks for the info, will follow you, please keep us updated. I see you love exotic technical analysis indicators, nice, upvoted :-)
Yes, hehe, Ichimoku is a powerful indicator, a one stop shop for total TA of a market, though I prefer to mix many indicators to look at the market from every possible perspective. Most would agree, analysis is key to a safe and profitable trade. :)
If my BTC is in a Jaxx wallet will that give me the Bitcoin cash? Cause the private keys is on there so..
Should be good to go with any wallet in which you hold your private keys.
How about bitshares? It is decentralized but do you know how one can get the individual private keys of the individual assets, like private keys for bitcoin for instance?
Bitshares has its own wallet services and is not related to this fork, however, stay tuned and follow, i will be covering Bitshares in a future post.
Extremely helpful and informative! Finally getting some clarity on this situation and on what to do! Thanks very much!
Very thorough analysis, you made both, fundamental and technical analysis. Great job @thebeachedwhale, keep on!
I have a question, what about paper wallets, would BCC (or BCH officially) generate automatically after importing private keys into a hot wallet?
It is a bit more technical than that. You must move each coin to a new wallet seperately. Maybe this #Electrum wallet tutorial will give you some idea (though it is not the same exact procedure).
Bittrex, Kraken, BTCpop also supporting BCC.
Bittrex and Kraken are mentioned above due to widespead community usage and approval. Thanks @wintermute.
My bit of bitcoin is with bittrex.You advise holding in a safe place.What do you advise as a safe place ?
Thank you.
Bittrex may be okay for small amounts, but a much safer place would be in your own possession with a hardware wallet in which you control the keys, like Trezor.
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STOPWhere you from my friend ? i want to know which country to belong to @ronaldmcatee
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