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In November 2017, Bitcoin was subjected to rigid fork which led to the creation of Bitcoin Gold (BTG). Because Bitcoin Gold is a fork of Bitcoin, anyone who held Bitcoin before the fork received an equivalent amount of BTG to BTC.
Therefore, of course, the capitalization of the currency market is large and is positioned close to first place, ranking at number 25 with a market capitalization of $ 206 billion. For the uninformed, it would seem that Bitcoin Gold is one of the main cryptocurrencies and is worth investing. However, this could not be further from the truth.
A recent study published by Crypto.IQ exposes the various defects of innumerable "shitcoin" that afflict the cryptocurrency market. Their study on Bitcoin Gold has revealed some serious flaws that undermine the value of the project.
Bitcoin Gold vulnerable to 51% attacks
The key difference between Bitcoin Gold and Bitcoin is that BTG is designed to withstand ASIC miners and make mining more available and distributed to GPU miners. While this has worked for a while, the rate of hash mining for BTG has become so low that it is very susceptible to a 51% attack. In fact, this has already happened once in May 2018.
Before the attack, the new ASICs allowed to extract Equihash, once resistant BTG proof-of-work (PoW) protocol. Not long after, the Bitcoin Gold network stole $ 18.6 million BTG in a 51% attack.
To prevent another attack such as this, BTG developers laboriously forged BTG to implement an Equihash upgrade that should be more resistant to ASICs. What developers have failed to understand is that manufacturers can produce ASIC for any PoW algorithm. Therefore, BTG is still highly vulnerable to a 51% attack.
Bitcoin Gold is centralized
The study also revealed that Bitcoin Gold has important centralization problems. Since the beginning of the creation of Bitcoin Gold in November 2017, the developers have pre-empted 8000 blocks, obtaining about 100,000 BTG.
At the current price of $ 12 it is $ 1.2 million and when BTG had peaked at almost $ 500 in December, the developers had $ 50 million. According to the BTG team, they would release the pre-extracted BTG slowly over time, not all at once.
However, according to Crypto.IQ, there is no way of verifying if this is true and speculation is rampant among the community that developers have contributed to the excessive 97% price drop by downloading BTG.
Bitcoin Gold is a Shitcoin?
Bitcoin Gold is not cryptographically secure as their plan to become more decentralized with the use of ASD-resistant poW extraction has failed and become their most fatal flaw. The power of hash mining of BTG is very low, which hurts with a chance of attack of 51%. Finally, the currency is highly centralized with developers in control of a large offering and failing to solve the BTG ASIC draw problem.
Taking into consideration all the points dealt with in the Crypto.IQ study on the profitability of Bitcoin Gold, it seems that it is a shitcoin. The takeaway? Crypto users should educate themselves thoroughly before investing in any cryptocurrency. Just because a coin is placed very high on CoinMarketCap does not mean it's worth buying.
Do you keep any Bitcoin Gold? Do you agree with the points mentioned in this article that refer to BTG as shitcoin? Let us know in the comments section below.
