By
Bhushan Akolkar
April 23rd, 2024
The upcoming SegWit2x hard fork which was scheduled for November 16 has been canceled due to lack of consensus between the member of the community. Bitcoin will be splitting no more.
One or the other reasons seem to be supporting the Bitcoin rally. Yesterday on Nov. 8, Bitcoin hit its yet again new all-time high of $7879 soon after the news broke out that Bitcoin ain’t splitting anymore and the SegWit2x hard fork, scheduled to occur on November 16th, has been canceled. Sighting the lack of consensus, the developer community who was pushing for the hard fork in order to increase the block size has completely suspended any further plan of action for the upgrade.
A unanimous decision has been taken by some prominent Bitcoin companies like Bitmain, Xapo, BitGo Blockchain.info and its six CEOs have signed a letter announcing the cancellation. In the letter, BitGo CEO and co-founder Mike Belshe said:
“Our goal has always been a smooth upgrade for Bitcoin. Although we strongly believe in the need for a larger block size, there is something we believe is even more important: keeping the community together. Unfortunately, it is clear that we have not built sufficient consensus for a clean blocksize upgrade at this time. Continuing on the current path could divide the community and be a setback to Bitcoin’s growth. This was never the goal of Segwit2x… we are suspending our plans for the upcoming 2MB upgrade.”
The SegWit2x hard fork event was important from the point of view that with limited blocksize and increase in investor participation, the bitcoin transaction costs have gone up while keeping the transaction costs lower has been the major USP of the blockchain technology.
Moreover, with the block capacity being low enough to cater such a huge investor base the transaction times have also gone up. With the existing block size allowing only seven transactions per second, the adoption of Bitcoin as a mainstream digital currency remains uncertain. The SegWit2x hard fork was a proposal to overcome these issue by increasing the block size and hence pave the path for further scalability of bitcoin.
Just when everyone is having a close observation of the latest Bitcoin rally, the cancellation of the hard fork plans puts serious thoughts in the minds of investors as what course of action will be followed further to scale up Bitcoins.
On these turn of events Matt Corallo, a former Blockstream developer says “Let’s take Segwit2x’s failure as a learning experience – Bitcoin’s community is strong, and needs to broadly support any changes to Bitcoin’s consensus rules. Future proposals must start by soliciting broad community feedback, not just an afterthought.”
However, there are some experts from the industry that believe the plans of SegWit2x to have not been properly formulated and if implemented in rush would pose a formidable risk to the security of Bitcoins.
Bharath Rao, CEO of Leverj says: “While occasional forks due to deep philosophical differences are inevitable, habitual forks damage the network effect of any blockchain and undermines security and faith in the system. Cryptocurrency is still experimental and repeated forks can fracture the community into tiny siloes and undermine the very concept of non-governmental money.”
“Rewards exist precisely because risk and opportunity exist. Every small mitigation of a risk enhances value, and this event is no different. The Bitcoin community welcomed the cancellation of Segwit2x with a huge price spike. We hope to see a continuous stream of risks eliminated and value enhanced over the next several years,” he added.
After hitting a new high above $7800, Bitcoin prices have again consolidated back in the past 24 hours and is currently trading at $7196, according to the CoinMarketCap. In a joint statement, the six CEOs of the core group issued a joint statement concluding “We want to thank everyone that contributed constructively to Segwit2x, whether you were in favor or against. Your efforts are what makes Bitcoin great. Bitcoin remains the greatest form of money mankind has ever seen, and we remain dedicated to protecting and fostering its growth worldwide”