Inside Bitcoin Diamond: Just the Latest of the New Bitcoins
The attack of the hard forks is in full swing, as it seems some new forked version of Bitcoin is springing up every couple of days now.
This week’s rendition? Bitcoin Diamond.
We’ll bring you up to speed.
Why Diamond at all
Image via Medium.com
If Bitcoin Cash is the payments-minded Bitcoin, and if Bitcoin Gold is a mining de-centralizer, then Bitcoin Diamond’s mission is to be a privatizer.
Regardless of what less-informed mainstream users think, the Bitcoin ledger really isn’t all that private. And blockchain detective firms like Chainalysis are helping Europol and the United States’ Internal Revenue Service to decode the identities of BTC users like never before.
That’s where Bitcoin Diamond comes in.
The devs behind Diamond have reportedly pioneered a way to encrypt balances and transactions on the Bitcoin Diamond network, paving the way for some seriously strong privacy for users.
Can it stand up to other privacy coins?
At this point, it’s hard to say since Diamond is still so early on and the devs haven’t made much progress yet.
But at this point it’s no stretch to say it’s doubtable.
First off, understand that few cryptocurrencies can come close to matching the fungibility of privacy coins like Monero and Dash right now.
BGD may provide an improvement over the privacy of the incumbent Bitcoin chain, but it surely won’t be able to hold a candle to the capabilities of more serious privacy contenders.
Users who put a premium on privacy, then, will surely continue to gravitate toward Dash and Monero instead.
Any other differences with BTC?
BGD’s other main notable contrast with Bitcoin is its 8MB block size. That means BGD is a bit of a Frankenstein between BTC and Bitcoin Cash, as the latter has already implemented 8MB block sizes compared to the former’s 1MB size.
Totally supply of coins is another huge point of difference. BGD will have 210 million coins in circulation when all is said and done. That’s ten times more watered down than BTC’s 21 million final coins.
Worthwhile investment or too many red flags?
Right now, there are just too many red flags for users to safely invest in Bitcoin Diamond so early on.
If anything, the space should step back and let BGD try to prove itself before going all-in on this latest Bitcoin spin-off.
Some concerning red flags include the fact that the Diamond team seems to be boasting of more wallet support than their project actually has right now. And they’re also saying that BGD is going to be instantly supported by a handful of strange, which seems perplexing when taken in context.
The privacy dimensions of the project are certainly interesting.
But with mainstream and even many novice users already finding Bitcoin private enough, there’s no indication there will be serious demand for Diamond in the short- and mid-term. Invest at your own risk!
Featured Image via Fotolia
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.