Bitcoin Gold (BTG) is one of the many hard forks to the Bitcoin (BTC) network which was released in November 2017. Although it was promoted as the real and democratic Bitcoin, it was not able to attract as many investors as expected.
Nowadays, Bitcoin Gold continues to be traded in a wide range of exchanges. Considering that it is cheaper to acquire than Bitcoin, many investors would like to buy Bitcoin Gold. In the next sections, we will share with you what Bitcoin gold is, how it works and how it differentiates with Bitcoin, among other things.
What is Bitcoin Gold (BTG)?
Bitcoin Gold (BTG) is a hard fork to the Bitcoin network that took place in November 2017 and that aimed at becoming the real and decentralized blockchain network that Satoshi Nakamoto was thinking about.
This virtual currency works in the same way as Bitcoin. Users can send it and receive it without a central bank or intermediary. This is one of the most important features of Bitcoin and Bitcoin Gold, it is not controlled by a central authority.
This blockchain network works with a proof-of-work (PoW) consensus algorithm that makes it possible for miners to process transactions. However, there is a very important difference between Bitcoin and Bitcoin Gold that we will discuss in the next sections: the mining algorithm.
Interesting: Buying Bitcoin (BTC): Easy Beginner’s Guide
While on the Bitcoin network it is necessary to have powerful ASIC miners, for Bitcoin Gold there are fewer requirements. That makes it easier for users to get access to the network and receive rewards for protecting the network.
Nowadays, users can get access to Bitcoin Gold by using a wide range of cryptocurrency exchanges. However, since it was launched, Bitcoin Gold was affected by a large number of 51% attacks. This is one of the reasons why users have been moving away from this virtual currency.
Bitcoin, instead, has never been successfully attacked due to the large hash rate that it has. In the next sections, we share with you which are the main differences and similarities between Bitcoin and Bitcoin Gold.
Differences and Similarities Between Bitcoin and Bitcoin Gold
There has been a reason why Bitcoin Gold decided to fork from the Bitcoin network. According to Bitcoin Gold’s official website, anyone can mine BTG with graphic cards. The goal was to make it easier for everyone to get access to financial solutions
But rather than do so in the way Bitcoin was offering, they have decided to fork from the Bitcoin network and start offering different solutions. These are just some of the main differences and similarities that there are between Bitcoin and Bitcoin Gold.
The first and most important thing to mention is that Bitcoin Gold has a different mining algorithm. Bitcoin Gold uses Equihash-BTG, which requires more memory than what an ASIC can support. However, many graphic cards are able to handle this without any problem, even the ones that come on many computers nowadays.
Bitcoin’s uses a mining algorithm called SHA-256. In order for miners to be part of the network, they have to use ASIC miners. These are very expensive devices that consume large amounts of energy and that make it possible for the Bitcoin network to be nowadays the most secure in the market.
For many years, most of the Bitcoin mining farms were located in China, with a large network concentration. This has been one of the main points that people against Bitcoin used to attack the network.
Furthermore, Bitcoin mining consumes a lot of energy. This is why it is necessary for miners to find colder places to operate (to reduce refrigerating costs). Moreover, the Bitcoin network has been attacked by mainstream media for consuming energy and contributing to global warming.
This is where Bitcoin Gold changes the way in which things work by making it possible for normal people that would never get access to ASIC mining to mine BTG. The mining process for BTG is quite simple and it is properly explained on Bitcoin’s Gold main website.
Despite this difference in the mining algorithm, Bitcoin Gold fail to attract a large number of miners and users. Bitcoin continues to attract more miners that invest in renewable energies and that are located all over the world and not only in China.
Price and Market Valuation
When we have a look at the price of these virtual currencies we also see that there is a clear difference between them. While Bitcoin is being traded above $43,400, you will not find Bitcoin Gold even close to this price.
Despite being among the top 100 (88th largest digital currency in the world in terms of market capitalization), this digital asset has a lower price compared to Bitcoin. Indeed, its price is currently $58 per coin, but it was once among the top 20 cryptocurrencies.
Bitcoin Gold has a market capitalization of over $1 billion and it could continue growing if the bull market in the industry keeps.
Despite having the same supply, these digital currencies have completely different prices. This shows that Bitcoin rather than Bitcoin Gold (BTG) was selected as the real “Bitcoin.” People preferred to own BTC and not BTG with the new mining implementation.
Security was more valuable than mining decentralization. This is why the price of Bitcoin Gold couldn’t follow Bitcoin’s price trend and it might never do. This is similar to what happened to Bitcoin Cash (BCH) after the hard fork in mid-2017 before the final record of the bull market for Bitcoin at $20,000.
As it happened with other Bitcoin hard forks, it is very difficult for hard forks to remain competitive for long periods of time. Bitcoin Cash (BCH) and Bitcoin SV (BSV) have been relatively stable over time. Bitcoin private, Bitcoin Diamond or Bitcoin Gold didn’t have the same good luck as BCH or BSV.
Bitcoin and Bitcoin Gold Supply Comparison
When it comes to Bitcoin Gold’s supply, we can only say that it is the same as for Bitcoin. The total supply is expected to be 21 million with a similar (almost equal) issuance speed. Both of these virtual currencies work with so-called halvings.
Halvings make reference to the coins awarded to miners for the work they do to protect the network. Every close to four years, the rewards for miners gets reduced by 50%, meaning that the new issuance of coins is reduced by half.
The current mining reward for BTG users is at 6.25 BTC per block, the same as for the Bitcoin network. This is one of the main similarities between these two virtual currencies in the market. There is just a difference in the circulating supply for both of these digital assets.
According to data provided by CoinGecko, there are 17,513,924 BTG coins in circulation. However, there are 18,779,062 BTC coins in circulation. This difference could be explained by a larger hash rate on the Bitcoin network that allowed the blockchain to mine blocks faster (or at the normal rate) compared to Bitcoin Gold.
Both of these digital assets are expected to reach a total supply of 21 million. The entire crypto market has reached a consensus that Bitcoin should remain with a total cap of 21 million despite some people claiming that there should be a supply increase for BTC.
Another thing to compare between Bitcoin and Bitcoin Gold is related to their acceptance. Bitcoin is the largest cryptocurrency in the world and it is clearly accepted in a larger number of places than Bitcoin Gold.
Due to different reasons, including adoption and use cases, Bitcoin Gold was not able to get listed in all the exchanges, nor it was able to be used as a means of payment. Bitcoin has again shown it is a superior cryptocurrency when it comes to solutions offered to individuals and companies around the world.
Nowadays, users can rely on Bitcoin to pay for goods and services in a large number of shops all over the world. However, Bitcoin Gold remains a digital asset that is pushed by speculation rather than by real use-cases.
This does not mean, however, that there are no shops or companies accepting Bitcoin Gold. It will be much more difficult to find a Bitcoin Gold friendly store than a Bitcoin-friendly store. The team behind Bitcoin Gold should definitely work in order to expand the use cases of this virtual currency if they want to continue growing in the market in the next few years.
Bitcoin Gold in the Cryptocurrency Market
Bitcoin Gold has had a very good beginning in early 2018 and at the end of 2017. This is because it was heavily traded and considered to be a possible replacement to Bitcoin. Although this was fastly discarded, BTG was traded above $300 for several weeks. Indeed, the price of the BTG virtual currency reached $456 on December 20, 2017.
During the 2018 bear market experienced by Bitcoin, Bitcoin Gold suffered a lot. The virtual currency reached a low of around $9 at the end of 2018. 2019 was not better for this digital asset. Indeed, it remained close to $10 per coin despite the attempt for Bitcoin to start a new bull market.
During the Coronavirus crisis that affected the whole financial world in 2020, the digital currency (BTG) reached an all-time low of $4.25 per coin. Since that moment it has recovered by over 1,264% and it is now being traded above $55.
It is very difficult to make a Bitcoin Gold price prediction. Things in the cryptocurrency market change at very fast speeds. However, it is possible to think that the digital asset could eventually follow the current bull market and reach better prices. Whether this is sustainable remains to be seen.
Where to buy Bitcoin Gold?
There are different platforms where to buy Bitcoin Gold. This is because the team behind this project has been working in order for exchanges to accept this digital asset. Additionally, as a Bitcoin hard fork, it has attracted the interest of several crypto exchanges and wallets.
There are several recognized exchanges where users can easily trade Bitcoin Gold on a regular basis. Some of these exchanges include Bithumb, Binance, HitBTC, Uphold and Huobi, among others.
It is up to you to use the cryptocurrency exchange that you want in order to get access to this virtual currency. Let’s not forget that exchanges make it possible for you to buy and sell digital assets. You would not only be able to purchase Bitcoin Gold but you will also have the chance to use other services and solutions from these exchanges.
The larger the number of platforms supporting a virtual currency, the better it is for this coin. There is larger liquidity in the market and more trading volume for this digital asset. It is also worth mentioning that there are also some swapping services accepting Bitcoin Gold. Some of these platforms include Changelly, ChangeNow or CoinSwitch, among others. In some of these exchanges, you can deposit fiat currencies and purchase Bitcoin Gold and other digital assets in seconds.
Bitcoin Gold 51% Attacks
Due to its low hash rate, the Bitcoin Gold network has been attacked many times in the past. For example, Coinbase has delisted this virtual currency due to this reason. In May 2018, some months after being released, the digital currency experienced a 51% attack that was carried out by an “unknown actor.”
More than 388,000 BTG have been stolen after this attack. Several digital currency exchanges decided to delist this digital asset from their platform as the team behind BTG did not want to help pay the individuals affected on these platforms.
It is worth mentioning that this was not the only attack on the Bitcoin Gold network. Indeed, in January 2020, another 51% attacked was carried out, causing a blockchain reorganization. In order to deal with this attack, there has been an “emergency update” that helped the network elude this attack.
Despite the fact that there have been solutions to the attacks received by Bitcoin Gold, people and companies cannot trust a digital asset that is constantly attacked. This is where Bitcoin has been much more efficient than Bitcoin Gold showing that it is more resilient, stronger and capable of delivering solutions to users.