Bitcoin Cash and Bitcoin Gold Coins

Bitcoin Questions and AnswersCategory: General questionsBitcoin Cash and Bitcoin Gold Coins

Alan Freedman asked 1 year ago

I understand that a Bitcoin user has an equal number of Bitcoin Cash or Bitcoin Gold coins as they do Bitcoin when a fork occurs?  Say I have 10 Bitcoins, then all of a sudden I have 10 Bitcoins and 10 Bitcoin Cash coins.  Can I spend the 10 Bitcoins and 10 Bitcoin Cash coins independently?  Doesn’t seem to make any sense.  In a split second, the BTC user has increased his wealth automatically.  Wouldn’t everyone want a hard fork and then another and another?

1 Answers
Steven Hay answered 1 year ago

Hey Alan,
Yes, you understand the situation with hard forks correctly. One minor detail to note is that the Cash and Gold forks didn’t occur at the same time but a few months apart. It’s quite right that if you had 10 BTC at each fork date, you’d now have 10 BCH and 10 BTG as well. And yes, these 3 different coins may all be spent independently of each other though of course their values differ greatly at this time.
I think there will be more forks in future, as you say. However, I also think that eventually these forks will start running into the law of diminishing returns. The market will eventually become thoroughly sick of such hard forks and start to price them really low, which will mean that forkers are unable to make any profit from their work. Quite a lot of investment is required for a successful fork – money, reputation and the most scarce resource of all, technical ability. Most competent blockchain devs are unwilling to work on these forks, as they have quite a shady reputation already.
All that said, I’m not too worried about forks. This pattern has played out in Bitcoin before. First there was the altcoin craze, whereby 1000s of altcoins were created – all basically forks of Bitcoin with a few minor alterations but a new, unrelated blockchain. Then we had the ICO craze, which was basically another few hundred coins emulating Ethereum’s ICO launch success. Both of these crazes have now faded and such coins are considered pretty boring… It will be the same thing with fork coins in time. There may be a few useful ones which stick around, but most will be forgotten.

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