What is Bitcoin Gold (BTG)?
Bitcoin Gold (BTG) is the native cryptocurrency for the platform of the same name. It was developed in 2017 as a hard fork from the main Bitcoin blockchain. It offers a user-friendly, decentralized service for blockchain development and transactions.
Bitcoin Gold was one of the earliest Bitcoin hard forks and is considered one of the most successful ones. It uses a unique consensus algorithm known as the Equihash Proof-of-Work to ensure a more even playing field for all miners and support complete blockchain decentralization.
How Was Bitcoin Gold Created?
Bitcoin Gold was co-founded by Hang Yin and Martin Kuvandzhiev. Yin is a software developer. He’s the lead developer at Bitcoin Gold as well as the founder of the privacy-enhanced protocol Phala Network. Kuvandzhiev is a software engineer and entrepreneur. He was previously an assistant professor at the Technical University of Sofia.
The Bitcoin Gold blockchain forked away from the core network. The supporters of BTG believed that Bitcoin had become too centralized and had started to stray away from the vision of blockchain that Satoshi Nakamoto had presented. The aim was to build a new blockchain that would be truly decentralized and user-friendly.
The Bitcoin Gold fork occurred on October 24th, 2017. On the day of the blockchain launch, the BTG price was around $143. BTC coin holders were able to exchange their assets for an equal amount of BTG.
However, as one of the earliest Bitcoin forks, BTG was subject to some controversies. In November 2017, users found out that 100,000 BTG tokens were pre-mined before the launch, leading to a backlash from the community. Some exchanges also refused to support BTG, citing security concerns.
The asset has been significantly volatile since it was listed, going through rapid highs and lows. It reached its peak for the first year only two months after its launch, in December 2017. Then the Bitcoin Gold price was close to $540. However, this was followed by a rapid decline, and the value did not exceed $100 again until May 2021.
What Are the Uses and Features of Bitcoin Gold?
The tokenomics of Bitcoin Gold are similar to the original Bitcoin, as well as several other bigger forks. The Bitcoin Gold token supply is set to 21 million, making it a deflationary asset. This means that the BTG price is likely to rise as less supply becomes available in circulation.
Bitcoin Gold is a utility asset that can be used in transactions or for blockchain development. It aims to solve some of the scalability-related problems that the main Bitcoin blockchain experiences. Since it’s an open-source, community-based project, all users can freely participate in the on-chain processes.
Additionally, BTG holders can also participate in network governance. It’s another measure that’s used to keep the blockchain decentralized. Users are able to submit proposals regarding protocol changes and upgrades, as well as vote on the decisions as a decentralized autonomous organization (DAO).
What Are the Differences Between Bitcoin and Bitcoin Gold?
Despite deriving from Bitcoin, the BTG price is significantly different. Based on the trends, Bitcoin Gold has always been the cheaper asset on the market. It also hasn’t strictly followed the same crypto market trends as Bitcoin regarding its price fluctuations.
However, time may play an important role in the market differences. The fork occurred years after the core blockchain was launched. It’s likely that the Bitcoin Gold price may follow similar trends of increase, especially given the equal max supply of 21 million coins.
Both blockchains use the Proof-of-Work (PoW) consensus mechanism to ensure network security. However, on Bitcoin Gold, the algorithm was altered to be suitable for GPU mining. This mechanism is known as Equihash Proof-of-Work. It differs from Bitcoin, which uses the more energy-intensive application-specific integrated circuit (ASIC) mining.
ASIC devices are built specifically for crypto mining. They are more powerful than regular computers and can cost up to thousands of dollars to install and run. According to BTG backers, the reliance on ASICs has made Bitcoin mining more centralized as bigger corporations can run mining facilities.
As such, the Bitcoin Gold crypto mining process is more approachable to users since they can rely on GPU and do not require as many resources to produce new blocks. Equihash PoW makes the mining process more equitable and mitigates the risk of block production monopolies forming.
