How Bitcoin Exchange Market is Preparing for Hard Fork
Bitcoin exchanges are preparing for a potential hard fork execution of Bitcoin Unlimited.
Bitcoin exchanges are preparing for a potential hard fork execution of Bitcoin Unlimited. While most major Bitcoin exchanges including BTCC, Bitstamp and Bitfinex have clarified their stance on the hard fork contingency, some regional exchanges such as Korbit and HitBTC haven’t come to a consensus in regards to hard fork support.
On March 24, Cointelegraph spoke to HitBTC about their questionable statement released to their users about the Bitcoin Unlimited hard fork.
In their statement, HitBTC wrote:
“Bitcoin Unlimited has been listed on the platform and is available for trading from March 24. The exact date of the hard fork is currently unknown and BTC and BTU withdrawals are temporarily locked due to the probable replay attack which may occur after the split. Withdrawals will be unlocked soon after the hard fork is complete.”
“Sooner or later their Blockchains will be split”
Cointelegraph immediately reached out to HitBTC as the BTU token has yet to be released since the hard fork hasn’t been executed and, according to experts, it is actually very far from being forked.
HitBTC attempted to clarify their stance but offered a very ambiguous response instead:
“Currently there are 2 existing systems - Bitcoin Core and Bitcoin Unlimited. Both systems have daemons and nodes. At the moment they are using one [common] Blockchain. But sooner or later their Blockchains will be split and fully independent. If you look at Coin Dance, you will see real blocks with BTU, so BTU does exist.”
BTU simply doesn’t exist as of yet because the hard fork hasn’t been executed. Bitcoin miners signaling Bitcoin Unlimited support is very different from creating blocks with BTU. Bitcoin Unlimited tokens are credited to users by wallet platforms or Bitcoin exchanges when they are introduced to the network by the way of a hard fork.
However, if the hard fork isn’t executed, there is no way that users can trade it because the tokens do not exist.
Therefore, the announcement of HitBTC in regard to enabling BTU trading can be considered as a controversial and questionable move by the exchange, as the community is well aware that BTU tokens aren’t available yet.
What is HitBTC selling or crediting users with?
If the exchange is allowing users to trade BTU which doesn’t exist, what is HitBTC trying to accomplish? The first sentence of the statement of HitBTC read: “HitBTC, known for its cutting-edge technology, is giving you an opportunity to get Bitcoin Unlimited before the hard fork occurs.”
Anyone with the slightest understanding of hard forks and the Bitcoin protocol understands that Bitcoin Unlimited tokens can’t be created or distributed to the network without executing a hard fork. Therefore, how is HitBTC providing a way for users to get Bitcoin Unlimited before the hard fork occurs?
More importantly, what happens if the hard fork doesn’t occur? Then the derivative-like product which HitBTC is offering to users is rendered worthless by the market.
Bitcoin exchanges must respect the market and users and be responsible enough to make reasonable decisions to support the network and community.