Bitcoin Gold is a hard fork of the original Bitcoin blockchain that occurred on October 24, 2017. The main objective behind the creation of Bitcoin Gold was to make the cryptocurrency more decentralized by enabling more people to mine it. The fork was initiated by a group of developers led by Jack Liao, the CEO of Hong Kong-based mining equipment manufacturer LightningAsic.
The creation of Bitcoin Gold was prompted by the growing concerns about the centralization of Bitcoin mining. Mining is the process by which new Bitcoin units are created and transactions are verified. In the early days of Bitcoin, mining could be done by anyone with a computer. However, as the network grew, the mining difficulty increased, and specialized mining hardware known as ASICs (application-specific integrated circuits) became necessary to mine Bitcoin profitably. This led to the concentration of mining power in the hands of a few large mining pools and companies, which some saw as a threat to Bitcoin’s decentralization.
Bitcoin Gold aimed to address this issue by implementing a new mining algorithm known as Equihash. Equihash is a memory-hard algorithm that is resistant to ASICs and can be mined using consumer-grade hardware like graphics cards. This makes it more accessible to a wider range of people, potentially increasing the decentralization of the network.
The Bitcoin Gold fork was announced in July 2017, and the new cryptocurrency was launched on October 24, 2017, at block height 491,407. At the time of the fork, all Bitcoin holders received an equal amount of Bitcoin Gold. This meant that anyone who held Bitcoin before the fork had an equivalent amount of Bitcoin Gold in their wallet.
The launch of Bitcoin Gold was not without controversy. Shortly after the launch, it was discovered that the developers had created a premine of 100,000 Bitcoin Gold coins, which were set aside for the development team. This sparked accusations of insider trading and led to a drop in the price of Bitcoin Gold.
In addition, the Equihash mining algorithm used by Bitcoin Gold was found to be vulnerable to a 51% attack, in which a miner or group of miners could take control of the network and manipulate transactions. This led to further criticism of the project and raised questions about the security of the network.
Despite these challenges, Bitcoin Gold has continued to exist as a separate cryptocurrency. Its price has fluctuated over the years, reaching an all-time high of $484 in December 2017 before plummeting to a low of $5.88 in January 2019. As of September 2021, the price of Bitcoin Gold is around $61.
In conclusion, Bitcoin Gold started on October 24, 2017, as a hard fork of the original Bitcoin blockchain. Its main goal was to increase the decentralization of the network by implementing a new mining algorithm that was resistant to ASICs. However, the project has faced criticism and controversy over the years, including accusations of insider trading and vulnerability to 51% attacks. Despite these challenges, Bitcoin Gold remains a separate cryptocurrency with its own unique features and community of supporters.