A little-known Chinese company is threatening to put a fork in the high-flying bitcoin rally a hard fork, to be precise. <\/p>\n
The controversial cryto-currency, long favored by tech geeks and drug lords alike, has taken a painful price hit this week, burning a recent wave of Wall Street investors and average Joes who have lately climbed on board. <\/p>\n
It plunged by nearly a third on Thursday alone, changing hands as low as $2,074.69 after hitting an all-time high above $3,000 on Monday. <\/p>\n
An outage at a key US bitcoin exchange played a role this week, as did warnings from analysts at Goldman Sachs and Morgan Stanley that bitcoin looks overvalued. <\/p>\n
An even bigger problem for bitcoin, insiders say, may be that the currency itself could be split, or forked into two or more currencies as users squabble over how to fix growing lag times and fees for clearing transactions. <\/p>\n
The main reason [for bitcoins drop this week] is that there is likely to be a split in bitcoin on Aug. 1, Marc van der Chijs, managing partner at CrossPacific Capital and a bitcoin investor, told The Post. <\/p>\n
Aug. 1 is when a big contingent of bitcoin users has pledged to impose new standards for bitcoin mining, a costly, computer-intensive process for clearing transactions and creating new ones in the process. The change, which they call a soft fork in the currency, will make bitcoin transactions speedier and cheaper, they say. <\/p>\n
The problem: Nobody has the authority to impose those new standards on bitcoins decentralized structure, and a major, Beijing-based bitcoin miner called Bitmain just threatened to derail the whole plan with a hard fork namely, carving out a new, alternative currency that could compete with bitcoin. <\/p>\n
Bitmain is about 20 percent more efficient than average when it comes to mining bitcoin, and the upgrades in the Aug. 1 proposal could threaten that advantage, according to van der Chijs. <\/p>\n
They would lose their efficiency, van der Chijs said. <\/p>\n
Users have already nicknamed Bitmains new currency the Chinacoin, though its not known if it would only be open to Chinese investors. <\/p>\n
Bitmain didnt return an e-mail requesting comment. <\/p>\n
With a new market, especially one thats person-to-person, people are going to be a little more emotional, Alan Friedland, founder of bitcoin trading company Compcoin, told The Post. <\/p>\n
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Small Chinese firm threatens to derail plummeting bitcoin - New York Post<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" A little-known Chinese company is threatening to put a fork in the high-flying bitcoin rally a hard fork, to be precise. The controversial cryto-currency, long favored by tech geeks and drug lords alike, has taken a painful price hit this week, burning a recent wave of Wall Street investors and average Joes who have lately climbed on board. It plunged by nearly a third on Thursday alone, changing hands as low as $2,074.69 after hitting an all-time high above $3,000 on Monday Continue reading