On Tuesday, August 1st at 4 AM (UTC), what many are describing as an altcoin will fork off from the main Bitcoin network. August 1st is also the scheduled activation of BIP 148, also known as the User Activated Soft Fork (UASF).
The new, forking coin, Bitcoin Cash, will launch as a so-called User Activated Hard Fork (UAHF) – in reality; a Miner Activated Hard Fork. All Bitcoin (BTC) holders will receive an amount in Bitcoin cash equivalent their Bitcoin holdings.
Note: If you find yourself confused by all this “fork talk,” check out this article on the subject or Andreas Antonopolous’ excellent “Forkology” presentation).
A Brief Guide to Bitcoin Cash
Major Chinese ASIC manufacturer and mining pool operator, Bitmain, planned and coded a response to the possibility of a UASF-induced fork. This code, originally termed Bitcoin ABC and now known as Bitcoin Cash (ticker symbol BCC or BCH), will fork to a version of Bitcoin without SegWit but with an 8x larger blocksize.
Currently, Bitcoin Cash is estimated to have the support of just 0.26% of total Bitcoin mining hashrate and its price on the ViaBTC futures market is approximately 12% of Bitcoin’s. How these figures will develop after the fork occurs is a highly speculative matter.
Daily chart of Bitcoin Cash futures price on ViaBTC; currently the only available market. The present exchange rate of CNY to USD is 0.14.
The consensus appears to be that Bitcoin Cash will fail to gain meaningful traction. Without massive financial support, BCH will likely trade in a 3 (or even 2) digit range shortly after launch, as Bitcoin holders will sell it in masses for Bitcoin or fiat.
How Exchanges will Manage the Bitcoin Cash Fork
If your bitcoins are safely held in your personal Bitcoin wallet, your BTC balance will be credited and matched on the BCH chain. Splitting the coins then becomes your responsibility, should you wish to trade one side or the other.
Make sure to do your research thoroughly before attempting to split your coins; it’s a fairly complex and technical process. After the fork occurs, monitor the Bitcoin Cash price so judge the potential gain against the possible risk, plus the time and effort required.
Warning: Beware of services offering to split your coins for you! Unless verified as part of a trusted exchange, wallet or similar Bitcoin company, such offers could well be coin-stealing scams!
If your bitcoins are stored on an exchange (which is not recommended for security reasons), the relevant custodian will decide the fate of your BCH. In several cases, you won’t receive any BCH.
The following table lays out the stated positions of Bitcoin exchanges and wallets regarding this matter:
How Wallets will Manage the Bitcoin Cash Fork
Provided your bitcoins are safely held in a personal wallet, you can’t lose your cashcoins. However, there is a slight possibility that malicious miners might steal your cashcoins when you make bitcoin transactions. To avoid this risk, you may wish to split the coins into specific Bitcoin and Bitcoin Cash wallets.
Certain wallets will or have released specific updates, services and tutorials for splitting your coins. If your wallet does not support such a feature, you may consider temporarily or permanently moving your coins to a supporting wallet. As always, exercise great care when moving significant values.
As Bitcoin Cash wallets require access to your Bitcoin wallet’s private key and password in order to claim cashcoins, you should exercise extreme caution when downloading any Cash wallet. It would be far safer to move your bitcoins to a new wallet with a new privkey and password after the fork occurs. Only once your bitcoins are in a new wallet should you enter your privkey / password into any Bitcoin Cash wallet. This avoids the risk of privkey / password leaks via potential malware.
Bitcoin Core (aka Bitcoin QT)
Warning: installing Cash on the same machine as Core is dangerous. Using default installation options, Cash will overwrite and corrupt Bitcoin Core data – potentially wiping your real bitcoin balance! Learn about the Bitcoin data directory and back it up – especially of your wallet.dat file! – before installing Cash.
Bitcoin Core will not support Bitcoin Cash in any way.
While the latest version of Electrum, 2.9, is capable of distinguishing between competing chains, Electrum does not officially support Bitcoin Cash. Indeed, they consider the “Electrum Cash” fork of their software to be a trademark infringement.
The combined wallet and exchange service, Exodus, will not support Bitcoin Cash, either through splitting or providing a market.
The popular Trezor hardware wallet will support Bitcoin Cash. Trezor’s web interface will feature a tool for safely splitting your coins. Consult Trezor’s official statement for further information
The popular Ledger hardware wallet will also support Bitcoin Cash. Their Chrome wallet interface will also feature a split utility and a selector for both chains. Consult their official statement for details.
Since Jaxx users are always in control of their private keys, corresponding Bitcoin Cash (BCH) will be safe in your Jaxx wallet. However, please know that you will not be able to access/send/receive your Bitcoin Cash (BCH) until the integration takes place.
If you have a Blockchain wallet, it is essential that you retain your wallet and corresponding recovery phrase and not delete them, even if you empty the BTC balance. Also if you are considering withdrawing funds from exchanges that will not support BCC, it is safe to withdraw to your Blockchain wallet.
In the event of two separate blockchains after August 1, 2017 Blockchain.info will support the longest chain. As of today, Blockahin.info has no immediate plans to fully support the Bitcoin Cash fork within our main product. But, if BCC develops into an actual chain and market, you will be able to use your recovery phrase to export your funds and use them on that chain, regardless of whether or not Blockchain chooses to support it.
KeepKey plans to support all forks of bitcoin as unique currencies and will allow you to swap between them with ShapeShift.
Copay has no immediate plans to support BCC. Since these apps are true bitcoin wallets, users hold the private keys and have full, exclusive access to their funds. While users will not be able to observe a BCC balance or create BCC transactions at this time, it is possible to access BCC at a later date with additional software.
If the fork is successful you will automatically have the equivalent amount of BCC as the amount of BTC stored in your BTC.com wallet.
When in doubt visit BitcoinCash.org to see if your exchange or wallet is supported.
Have additional info to share? Feel free to leave it in the comment section below.
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