Bitcoin Cash (BCH), the largest fork of the original Bitcoin network, and the network that stood out from it, Bitcoin SV, is about to host a fundamental technical event for its blockchains.
On block 630'000, which is expected on Wednesday morning ET, the number of BCH coins created approximately every 10 minutes will halve, from BCH 12,5 to BCH 6,25. This will be the first halving for BCH, followed by some users going to follow online on Reddit.
This event portends the same process taking place on a larger scale on the Bitcoin blockchain (BTC) next month. BCH has a market capitalization of approximately twenty-fifth of BTC.
And if this is not enough for you, then Bitcoin SV (BSV), a cryptocurrency that has already emerged from Bitcoin Cash (BCH) after another fierce debate, will halve and halve in a day or so.
Halving is considered a monumental event as it emphasizes that the supply of coins is fixed, which distinguishes BTC and its counterparts from most national currencies. It is also likely an important variable that has driven bitcoin prices up in the past.
Halving of BCH and BSV networks is expected before Bitcoin halving, in part because BCH temporarily had a different algorithm for determining how quickly the mining difficulty would change, which temporarily accelerated the block creation process.
Probable problems
This slightly earlier date may have unintended consequences. BSV Developer Brad Jasper сказалthat in the short term "shocks are possible" for the respective cryptocurrencies.
He expects miners to temporarily move to other networks. The main source of income for miners is receiving rewards for adding new blocks, which will be halved, making these blockchains less profitable for mining. Meanwhile, the BTC block reward does not halve for another month or so.
“When BSV and BCH go through the halving, both networks will lose hashrate, which is likely to spill over to the BTC network,” Jasper said. In the long term, he argued, BSV will prevail because of its "usefulness" as a network that prioritizes transaction growth; although the developer of the Bitcoin SV network may be judging biased.
Attack 51%
Norway-based Arcane Research has agreed to a possible reduction in computing power in reportreleased last week but has gone further. According to Arcane, if the hashing power is reduced, the two cryptocurrencies will be more vulnerable to a 51% Attack when attackers gain control of the network.
But Jasper said he expects the situation to change quickly once BTC goes through the halving next month, as he will no longer be generating more revenue than his offspring.
However, not everyone is convinced that this halving will lead to something exciting or unusual.
Bitcoin.com CEO Roger Ver, a broad supporter of Bitcoin Cash, said the BCH halving "would not be an event" given the history of BTC halving; although the network representative may be simply trying not to highlight the problematic event for the network he supports.