Bitcoin faces another split as scaling debate rages within the community

 
Courtney Goldsmith
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Bitcoin Value Soars And Drops
Bitcoin split in two earlier this year, creating offshoot bitcoin cash (Source: Getty)

Bitcoin may be in for another bump in the road after prices levelled out this week, hovering around the $4,000 level after a recent plunge below $3,000.

The famously volatile cryptocurrency has shot up from less than $600 this time last year to an all-time high of more than $5,000 earlier this month, according to CoinDesk's bitcoin index.

However, bitcoin's huge rise in valuation has not come without its hiccups.

Last month the cryptocurrency split in two following a long-running rift in the community of developers and miners over how to scale its technology.

Bitcoin cash splintered off in a so-called hard fork when a group of miners who create the cryptocurrency, started using a different software called Segwit2x.

Now, industry insiders say a third split could come in the coming within months.

At an industry event in Hong Kong, Roger Ver, an early adopter of bitcoin, told Bloomberg Television bitcoin looked increasingly likely to have another hard fork in November, which would create a third version of the cryptocurrency.

Iqbal Gandham, UK managing director at eToro, said the prediction was "absolutely right".

“This goes back to the original debate on how to scale bitcoin, which centred around implementing a protocol called Segwit2x. The process was due to take place in two stages; the first was to implement the Segwit, the second to implement the ‘2x’ element, which enabled blockchain miners to double the size of ‘blocks’ that they mine. This would in turn allow for more Bitcoin transactions to be completed more quickly.

“But several diverging opinions emerged within the mining community. Some miners stated that they did not need Segwit, while others said they did not need the ‘2x’ bit. The debate rages on in the mining community, and this does create the very real possibility of further bitcoin splits in the near future.”

Read more: Phew: Bitcoin breaks back above $4,000

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