Sunday, December 4, 2022

Bitfinex May List ‘Legacy Bitcoin’ on Exchange After a Soft Fork

Bitfinex May List ‘Legacy Bitcoin’ on Exchange After a Soft Fork

Bitfinex has hinted that, in the event of a Bitcoin user-activated soft fork (UASF), it may list the legacy coin on its exchange. It raises the prospect of “two Bitcoins” trading alongside each other.

Also read: Fluffypony Speaks: Why I Had to Troll the Monero Market

According to comments made by Bitfinex chief strategy officer Phil Potter in a Teamspeak discussion, the exchange will support whatever its customers want. And it is actively preparing to list both chain-split and legacy tokens if BIP 148 is activated.

Bitfinex community services representative Brandon Carps told Bitsonline the company’s official position is “neutral” rather than “confirmed”. It has no official stance at this time on whether such a token should be listed.

In the event of a blockchain fork (whether hard- or soft-) there’s the strong possibility of part of the network remaining on the legacy chain. That creates two potential currency tokens, which could be traded on an exchange separately, with two values. Ideally, only the “majority” coin would become Bitcoin, but the alternative may still retain strong support. This happened in 2016 with Ethereum’s ether currency — the legacy chain still exists and is know called “Ethereum Classic” ETC.

What is the User-Activated Soft Fork?

To explain: Bitcoin Improvement proposal (BIP) 148 plans to soft-fork the Bitcoin network to activate Segregated Witness. This separates the signature data from transactions to increase the number of transactions in the existing 1MB blocks.

Starting 1st August 2017, miners will start signaling support for the UASF. Once they do, any nodes that are SegWit-ready will begin activating it.

To the user, there’s no difference and no-one will lose their bitcoins. However they may now have coins on two different chains that they can potentially trade. That part is up to the exchanges, and Bitfinex is a major one.

A user-activated soft fork via BIP 148 may not even be necessary anymore. Thanks to the Bitcoin Scaling Agreement reached at New York’s Consensus conference this week, Bitcoin will get SegWit anyway.

Would you trade a “Bitcoin Classic” or the same thing by another name? Let’s hear your thoughts.

Image via Pixabay

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