Are you old enough to remember the hype around the Millennium Bug? The Y2K problem was widely-anticipated to affect computer systems which stored dates as two-digit numbers for the year, making the year 2000 indistinguishable from 1900. Disasters from banking crashes to nuclear meltdowns were predicted. However, when 1st January 2000 arrived (and 1st January 2001 for computers that didn’t recognize 2000 as a leap year!), very little of note happened.
With the upcoming Bitcoin soft-fork on 1st August 2017, you could be experiencing a strange sense of deja-vu and expectation that the sky is going to fall in for Bitcoin. Although there’s a good case to be made for ensuring you know what might happen, here are two things to consider that might set your mind at rest (or at the very least, make you secure your Bitcoin today!):
- Bitcoin is now accepted as payment by over a quarter of a million retail businesses in Japan through POS apps – Japan has the advantage of being both an early adopter of new technologies and innovations in e-commerce, and naturally cautious as a market. To adopt Bitcoin as a payment method is a huge indication of confidence.
- The current price of Bitcoin is high and fairly steady – you could interpret this in two ways; either Bitcoin investors are burying their heads in the sand (or even unaware) of what early August will bring, or they don’t perceive it to have a long-term effect on the value of Bitcoin. Since Bitcoin investors and adopters tend to be reasonably savvy and aware of developments, the most likely explanation is the reasonable expectation that any difficulties will be temporary.
It’s not unreasonable or pessimistic to expect problems, however. If you view your Bitcoins as an investment rather than as a currency, you might wish to reduce your wallet to a sum you could afford to lose. It is highly unlikely that the chain split on 1st August will spell the end of Bitcoin, but it would be sensible not to carry out any Bitcoin transactions until the dust settles. Even those who are highly suspicious of crypto currencies are predicting nothing worse than demand dipping for a while. If you’re in for the long-haul, be prepared for the inevitable price-dip.
What’s the worst-case scenario?
Here’s the deal – nobody who is personally or literally invested in Bitcoin at a high-level, or in Bitcoin mining is going to do anything which will damage this or any other cryptocurrency. It’s just not in their best interests. The fork may, for a while, cause the price to plummet, and this could delay further adoption of Bitcoin as a payment method for goods and services, as retailers will understandably exercise caution.
The best advice is to make sure you control your keys – the most likely scenario then is that your balance will be the same on both chains, enabling you to trade one for the other. Keep an eye on your regular Bitcoin news sources, and hold on tight!