Is BTG a BTC Fork Failure? Read Our Bitcoin Gold Price Analysis
Alarm bells are ringing regarding the Bitcoin Gold price, as the poorest relation to the Bitcoin cryptocurrency reached an all-time low earlier this month and is showing no indication of improving. On Saturday 11th June, BTG/USD fell by over 7% throughout the day and as much as 9% from its highest price of the day. Although the price of Bitcoin Gold touched as high as $34 late last month with suggestions that a road to recovery could be ahead for BTG, this significant retraction to just $20.60 confirms that crypto bears have a firm grip on its value.
Perhaps the biggest concern for Bitcoin Gold is that there doesn’t appear to much support for it even at a price of $22-$23, with stiff resistance building after its decline from weekly highs of $34. Saturday’s dramatic drop was merely a taste of what the rest of this week had to offer for the price of Bitcoin Gold. After failing to stabilize at the $20.60 mark, its price fell of a cliff once again overnight with two significant retractions – first from $20 to $18 and then $18 to $16. Finally, there appears to be some element of support for BTG at $16. Still, the fact that the Bitcoin Gold price has almost halved (47%) in price during the last fortnight suggests that this may soon be confined to the graveyard of Bitcoin forks rather than evolving.
Bitcoin Gold is an alternative hard fork of the Bitcoin blockchain that was designed to provide an ecosystem that made mining more accessible to those with even the most basic of hardware. The founders of BTG believe that the Bitcoin blockchain has – ironically – become too centralized. They believe that the number of commercial banks mining the vast majority of Bitcoin makes a mockery of the intended decentralised purpose of peer-to-peer cryptocurrencies and the original rules of Bitcoin. Instead, BTG aims to make mining a more equitable process for all.
Bitcoin Gold requires a different hashing algorithm that makes proof of work harder for ASICs. With mining Bitcoin using application-specific integrated circuits (ASICs), processing power is all that matters, which is why Bitcoin mining became an industry in its own right. BTG aims to dethrone the dominance of these companies by using the Equihash hashing algorithm that’s ASIC-resistant. Equihash has already helped power the growth of altcoins such as Zcash.
However, in the last fortnight, Zcash has also experience a 40% decline in its value, falling to lows of around $125 from highs of over $200. The lack of support for the Equihash-protected Zcash is symptomatic of the decline in demand for Bitcoin Gold. Even those Bitcoin owners who received a host of BTG in a 1:1 ratio at the time of the new fork appear to have ditched the concept of the Equihash hashing algorithm. And with crypto experts anticipating another Bitcoin rally around the corner, who can blame them?
*Information in this article should not be taken as investment advice.