Bitcoin and Cryptocurrency Blog

How Coinbase applied BCash (BCH) lessons to Segwit2x hard fork

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The failed BCash hard fork has taught Coinbase to always maintain a neutral stance (in its policies and actions) whenever a feud in the Bitcoin community results into a split of the blockchain.

Coinbase is one of the largest cryptocurrency exchanges (and wallets) on the face of the earth. Coinbase catered mostly to the United States before it expanded to Europe, UK and other parts of the world.

On Friday, the San Francisco-based exchange issued a statement stating that it will support the upcoming hard fork of the Bitcoin network which will give birth to a new crypto coin separate from Bitcoin and BCash (BCH). 

Bitcoin to go through another hard fork

Actually, Bitcoin holders should be expecting more than one hard fork as the year runs to an end.

The much-talked-about one is the SegWit2x hard fork - which arose over arguments on how to make the currency scale better. This is scheduled to happen in November.

The other is the less-talked-about Bitcoin Gold hard fork, which will happen on the 25th of October, and is much more of an experimental project. 

Coinbase's error with BCash, and lessons learnt

When it emerged that there would be a hard fork in August, due to differences on how to make Bitcoin scale, Coinbase decided to side with one side of the combatants and said it would not support BCash. It is still paying for that decision, particularly as the price and utility of BCash continue to slide off into the "never never".

Citing security reasons, Coinbase withheld the BCash of its customers and this ushered in a gargantuan backlash, censure, and allegations. Many cursed them and some even threatened to sue them while a large number decided to break up with Coinbase. America is a free country - you can do as you please, as long as it's within the law.

Coinbase later said it would release customers' BCash to them in 2018 but the deed has already been done. This loss of customers and love among its users taught Coinbase ( and other exchanges in their position) to cater to its customers, no matter what chain of Bitcoin they believe in. Because exchanges provide support for users in both camps, they must remain centrist, but at the moment advise their customers what's best for them.  

Details of Coinbase's support for Segwit2x hard fork

Here's Coinbase's statement on Friday announcing support for the coins resulting from the Segwith2x hard fork in November. 

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From this statement, it is clear that Coinbase clients will get access to both coins on the two networks and will also be able to trade with them. However, it is likely customers won't get their coins on the day of the fork. Coinbase says it will only release the coins as soon as it has built a capable, secure system which is free from replay attacks.  

This stance is much different and welcoming when compared with what happened in August. What is yours is yours, what is ours is ours but what is mine is mine. 

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