So there is a lot of press about the changes in the upcoming changes to the Bitcoin code. What is it? Why is there a fork? Should I worry? What do I need to do? When is the fork going to happen? Those are the questions I want to answer in this post. I will do my best to keep it simple for even for non techie people to understand. If you are looking for an article that goes in depth of the fork this one isn’t going to be it.
What is the Bitcoin fork?
A fork means a split in a currency into two different, competing currencies. Yes, from this Bitcoin will split into 2 currencies based on the “same” code and blockchain.
The new coin will be called. Bitcoin Cash or BCC
Why is there a fork?
For a long time there has been a discussion between the main core developers and everyone who contributes to the code about the size of the blockchain. Currently the blockchain is 1mb which means it allows 7 transactions a second. That is extremely slow considering most financial companies can do 1700 a second and when pushed can handle over 50,000 transactions a second.
Let’s show you why this is a problem. We will use Starbucks for this example. In 2016 Starbucks had 25,085 stores worldwide. For giggles, let’s say each store made 1 transaction per minute. So 60 transactions per hour. Most are open for 19 hours which means in 1 day they make 1,140 transactions per day per store and 28,596,900 transactions worldwide each day. When using Bitcoins current blockchain to do the transaction per minute bitcoin can do 420 transactions. Considering Starbucks does 28,596,900 transactions a day it will take Bitcoins blockchain 68,087 minutes or 47 days for the transactions of 1 day to process.
With the size of the blockchain increasing it makes more transactions per second possible. This would allow blockchains to be used in a real world situation like purchases and not take 47 days for your order to process.
Should I worry?
No, the split is going to happen without most people noticing any changes. The changes come due to exchanges protecting themselves from the possibility of something happening. Once the fork happens everything should go back to normal like nothing happened and we have another coin based on Bitcoin.
What do I need to do?
Short answer is absolutely nothing. Bitcoin will function just like before the fork.
When is the fork going to happen?
The fork is proposed for August 1, 2017. Most places will be disabling withdrawals on July 31 in anticipation of the fork.