A little after 8AM ET today, Bitcoin was split into Bitcoin Cash, an alternative cryptocurrency, in a chain split that had been anticipated for months. The split, called a “hard fork,” comes out of a bitcoin group’s desire to combat high transaction fees and a bitcoin size limit that made mining larger blocks invalid.
This has a nuanced implication for Bitcoin owners. If you own Bitcoin and control your private keys, the same private keys can be used to spend your newly minted Bitcoin Cash.
If you own Bitcoin but don’t control the keys, then it depends on whether you’ve chosen to keep your bitcoins on a Bitcoin Cash-friendly platform or digital wallet. Each platform is treating the new Bitcoin Cash differently. To enjoy this extra currency, you should check with your platform and wallet to see what the company policy is.
As a prelude to the split, Bitcoin trading platforms like CEX.io suspended Bitcoin withdrawals beforehand. CEX.io will allow both cryptocurrencies and split the coins for its customers. CEX.io chief marketing officer Eugene Kovalyk says, “Whether we will list Bitcoin Cash as a new trading pair depends on the demand. If demand is big we should consider adding it definitely…No one should lose Bitcoin Cash on our platform.”
Meanwhile, the world’s most popular cryptocurrency exchange, Coinbase, has rejected the new Bitcoin Cash to some customers’ chagrin. It argues that their systems can’t support Bitcoin Cash without a major system rework that is currently not worth the unknown value of Bitcoin Cash. A spokeswoman for CoinBase says, “If this decision were to change in the future and Coinbase was to access Bitcoin Cash, we would distribute Bitcoin Cash to customers associated with Bitcoin balances at the time of the fork. Coinbase would not keep the Bitcoin Cash associated with customer Bitcoin balances.” The exchange allowed a brief window of time before August 1st for users who wished to access Bitcoin cash to withdraw their funds from Coinbase.