Fool’s Gold? Miners Losing Trust After Bitcoin Gold Launch Hassles
Newly “forked” coin Bitcoin Gold (BTG) is reportedly breaking miners’ and supporters’ trust with its wobbly launch. Problems with nodes connecting to the network and possible interference from opponents have disrupted BTG’s first day.
The new cryptocurrency, which parted from the Bitcoin blockchain on November 13th 2017, has a stated aim to take Bitcoin mining back to Satoshi Nakamoto’s initial dream of “One CPU, One Vote”. Its proof-of-work algorithm, dubbed “Equihash”, is designed to favor consumer-grade GPU hardware over the SHA-256-specific ASIC chips, that have dominated Bitcoin mining since 2013.
This is the second time this year a prominent hard fork has formed a new cryptocurrency taking the Bitcoin name — the first was Bitcoin Cash (BCH/BCC) in August 2017.
BTG has been controversial since its announcement, with opponents claiming it uses the Bitcoin name without having widespread support from that community. Last month also saw accusations BTG developers had forked the blockchain earlier than announced, effectively “pre-mining” coins. Now, the broken launch has now resulted in many leaving the project.
Problematic Payout Policy
The proposed payout system for BTG’s official mining pool has also angered some participants. Fund distribution is intended to take place after the first 100th block was found — then giving miners their dues after every 100 block-cycle.
The BTG team posted on social media: “Attention all community members, we have recently had inquires about unpaid balances with our official pool. Pool.gold balances are paid out on each 100 block cycle, all transactions are on record and the payout will happen when the 100th block for the pool is found”.
— Bitcoin Gold [BTG] (@bitcoingold) November 13, 2017
Apparently that’s not soon enough. Replies to the post showed members losing trust in BTG, even proclaiming it a scam. With this particular payout policy, miners feel they mining air and not coins.
Many questioned why the pool does not pay out in real time, as with other cryptocurrencies. Some users have also reported a loss of tokens, and have issues with the official wallet being unable to sync.
The windows wallet won't sync pic.twitter.com/cvjLjPrGyf
— Joshua Lowtek Burton (@lowtekmorgellon) November 13, 2017
BTG Must Regain Users’ Trust
Developers announced yesterday: “All engines set for ignition the launch of Bitcoin Gold is here we are proud to release the main net to the community and launch Bitcoin Gold into the Future and make cryptocurrency decentralized again. The bitcoin network is now live”.
However, Bitcoin Gold’s main net official launch was not as smooth as the BTG development team would have wished for. Allowing the software to be downloaded from partially reliable sources without checksum verification — some of which were reportedly misdirections or fraudulent — led to further loss of trust.
— Rhett Creighton (@HeyRhett) November 13, 2017
Many had their doubts the new cryptocurrency would make it to a live launch. In the end, it did — but it wasn’t a successful one. BTG has still kinks to iron out, and must work to regain the trust of its miners and supporters.
At this stage only a handful exchanges support Bitcoin Gold trading — although among them are well-known platforms HitBTC, bitFlyer, and Bitfinex. Therefore, the BTG price may suffer instability. This isn’t uncommon among new cryptocurrencies and volatility may even attract traders — but Bitcoin Gold will need something more substantial to survive longer-term.
What’s your opinion of Bitcoin Gold? Please share your thoughts in the comments.
Images via Twitter, Pixabay