Hard Forks

Not everyone agreed that the problem was this severe or that the proposed solution was the best answer. This is not surprising since the community included those who owned machines specifically built to do the “old math” and had a financial incentive to keep things the way they were. A rift developed in the Bitcoin community over this issue.

The structure of blockchain includes a solution to this type of disagreement. The solution is called a hard fork, and it is just what it sounds like. A hard fork is a new string of transactions branching off from the previous list. The start of this new list is the change to Bitcoin Gold, and it happened on October 24, 2017. Everyone holding Bitcoin at that date received an equal amount of Bitcoin Gold to use on the new fork of the blockchain, that is, the new string of transactions.

This move was criticized at the time as a simple attempt to create new value off the “Bitcoin” brand. Keep in mind that the total number of cryptocurrency units doubled at the time of the hard fork. However, this does not mean the value double since the market value of Bitcoin Gold was not the market value of Bitcoin. In fact, if no one supported the new Bitcoin Gold cryptocurrency it would quickly become worthless.

This threatened to be the case, particularly because of criticism of how the transition was handled. Some actions by the proponents of Bitcoin Gold had at least the appearance of simple greed, including delaying the release of mining software to the cryptocurrency community. This supposedly allowed those with “insider “access the opportunity to create units of Bitcoin Gold without competition.

Eventually Bitcoin Gold achieved a stand-alone status in the cryptocurrency markets. Although the value does not rival Bitcoin, it does command a respectable market price and is actively involved in the development of new blockchain technology, including the Lightning Network.

Bitcoin Gold Mining

However, the low market price relative to Bitcoin means that specialized miners have not flocked to the creation of Bitcoin Gold. Keep in mind that any concentration would undermine the expressed purpose of creating Bitcoin Gold in the first place. This has created an opportunity for less technologically savvy individuals to participate in the creation of units of Bitcoin Gold without assembling computers specifically tailored to this purpose.

However, the value and potential value has attracted enough miners that some specialization is recommended. Remember that solving the math equation – hashing – is only one step in the process. It’s also necessary to arrive at the answer before anyone else and successfully post that solution to the blockchain. In effect, miners compete with each other in a cooperative venture.

Mining enthusiasts recommend against using a standard personal computer for this purpose. They suggest that using a high-quality graphics card significantly increases the likelihood of successful mining. Keep in mind that even if a computer is already owned and is not being used for other purposes, mining is not free. There are electrical costs. Mining Bitcoin Gold requires enough success to represent a return on this investment.

In addition to a graphics card, mining enthusiasts also recommend installing additional memory and checking the power supply for the entire system. The technical aspects of evaluating and installing any of these components are well beyond the scope of this article. However, they can be easily found on the Internet, along with the software required for mining.

For those unwilling or unable to take on the technical aspects of mining by themselves, it is possible to join a mining pool, which is a cooperative group that uses the computing power of individual machines to mine Bitcoin Gold. Each member of the group is rewarded with a percentage of the profits equal to their contribution. Mining groups can be easily found on the Internet and have a range of technical requirements.

How to Buy Bitcoin Gold (BTG)?

It is also possible to purchase Bitcoin Gold on a variety of exchanges. The market is very dynamic with new exchanges adding Bitcoin Gold. The best option for identifying an exchange is the official Bitcoin Gold website which currently lists 19 different exchanges where Bitcoin Gold is available.

The exchanges operate in a variety of locations and are not available in all countries. Some offer to exchange national fiat currencies such as US dollars for Bitcoin Gold, while others only exchange for Bitcoin or Ethereum.

Buying Bitcoin Gold with Fiat Currencies

For those who are looking to buy Bitcoin Gold with fiat currencies, not many exchanges provide this option. CEX.IO is one of the only exchanges that provide you the purchase of Bitcoin Gold with USD. If you previously own Bitcoin, all you need to do is to register in CEX.IO, confirm your account and search for BTG/USD.

Other exchanges that support Bitcoin Gold with fiat currencies include YoBit and DSX.

Another easy way to buy Bitcoin Gold is via AvaTrade which provides Contract for Differences (CFD’s) on Bitcoin Gold. The broker allows you to buy cryptocurrencies with a leverage position in a fairly simple process.

Buying Bitcoin Gold with Cryptocurrencies

For those looking to buy Bitcoin Gold with cryptocurrencies, you will need to go through an exchange that caters for the BTG/BTC or BTG/ETH pairing that you are looking to buy Bitcoin Gold coins with. Binance has the largest wide selection of cryptocurrencies, including BTG/BTC.

In the event that you don’t already have an existing account on an exchange and are not holding Bitcoins or Ethereum, open an account on Coinbase and purchase Bitcoin or Ethereum. Do note that, while there are higher transaction fees when purchasing with debit or credit card, the purchase is instantaneous.

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Bitcoin Gold Wallets

Regardless of how you plan on obtaining Bitcoin Gold, it will be necessary to hold it in a wallet. Like everything else in the cryptocurrency world, wallets are going through rapid change. Wallets that support the Bitcoin Gold blockchain are listed on the Bitcoin Gold website. Each has its own attributes and advantages.

The main distinction between wallets is between “hot” (online software wallets) and “cold” (offline hardware wallets). A cold wallet that is not plugged into the Internet is clearly more secure than a hot wallet that exists on a central server. Even wallets housed on personal computers that are connected to the Internet are vulnerable to attack.

Keep in mind that wallets are distinct from accounts on exchanges. While both can hold Bitcoin Gold or other cryptocurrency, accounts at exchanges are much more vulnerable to theft by hackers. This is simply because they represent a richer target. All cryptocurrency experts agree that Bitcoin Gold and other currencies should be stored in a private wallet –either hot or cold – and moved to an exchange only for trading.

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BTG – Holding and Trading

Bitcoin Gold is growing in popularity, as evidenced by the growing number of exchanges that offer it. However, it is also still very young, even under the standards by which cryptocurrencies are measured. These factors mean that the brief trading history might not be a good indication of the trading value. Still, there is one clear relationship that stands out.

The chart below from Coinmarketcap.com shows the price of Bitcoin Gold expressed in US dollars (Green line) and Bitcoin (Yellow line). There is a clear distinction before November 27, 2017, and afterward (seen as the point where the blue market cap line is calculated correctly).