What is Bitcoin SV (BSV)?

by in Crypto 101, Cryptocurrency For Beginners

what is bitcoin sv

What is Bitcoin SV

Related: What is Bitcoin (BTC) ?

BSV is a hard fork of Bitcoin Cash, which appeared on November 15, 2018. "SV" in the Bitcoin SV stands for “satoshi vision”. The development of the crypto coin was taken by Craig Wright. He addressed the scalability issue and increased the block size to 128 MB. Craig Wright announced that he is Satoshi Nakamoto, and his coin is true Bitcoin.

However, more than one developer worked on the project - it was a team of nChain and CoinGeek Mining. The productive work led to the receipt of an open-source license for the Bitcoin SV code from the University of Massachusetts. The creators of Bitcoin SV call the original white paper of Bitcoin the key document that guides them in the development of cryptocurrencies.

From a technical point of view, Bitcoin SV is the same Bitcoin Cash with increased block size. This factor increases the capacity of the network, as well as its scale. Innovations (smart contracts, decentralized applications) contradict the “true bitcoin”, so Craig Wright refused them.

Conflict with the community

The coin is represented in the most popular exchanges. However, trading on some sites was suspended due to a conflict in the crypto community. Binance CEO Changpeng Zhao criticized Craig Wright for his self-proclamation of Satoshi Nakamoto. Then the exchange representatives decided to delist Bitcoin SV from their exchange. Following Binance, Kraken decided to get rid of crypto. The asset disappeared from the exchange after a user survey “Do I need Bitcoin SV?”: 70% of users said the coin was unprofitable.

Craig Wright

What is the difference between BSV and BTC?

The original BTC had scalability issues due to a 1 MB block size limit. When the number of transactions increased, the waiting time for their processing increased. Thus, a situation was formed in which the rate of formation of blocks was several times faster than the speed of their direct extraction. In order to somehow resolve the existing nuisance, work was done to create a fork of BitcoinCash. Here, the block size was 8 MB, and over time increased to 32 MB.

The block size in Bitcoin SV increased from 32 MB to 128 MB, and after a while this figure was increased to 2 GB.

According to the developers, increasing the block size in Bitcoin SV will lead to significant scalability and reliability of the system. But many in the community believe that increasing the size of the block can lead to a worsening situation. The negative factors include the slow distribution of blocks over the network, which in turn will cause an increase in the number of ignored blocks. Also, the innovation will provoke an increase in capacity for processing large blocks, and this will increase centralization and will not affect scalability in the best way.

Pros and Cons of Bitcoin SV

Among the advantages, the following can be noted:

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After the BTC halving, when the reward for the BTC block decreased by 2 times, BSV became a little more attractive for medium-sized miners, since BTC mining became unprofitable. Now BSV is in the TOP 10, firmly occupying 6th place in the ranking. This is due to the high cost and capitalization, which are combined with high rates of liquidity of the coin. This ensures the great interest of most traders, which, accordingly, has a positive effect on the dynamics of coin's growth. On the other hand, there are many disadvantages:

  • No innovation provided. BSV copies BTC, therefore, it is completely unable to stand on a par with its counterpart.
  • High competition. BSV already has two serious competitors this is the main BTC blockchain and the network which was formed together with BSH, i.e. BCHABC. Some BSV indicators are already significantly behind their competitors.
  • Centralization. Due to the large volumes of hash rate, the network is under the control of several companies. Which can directly affect the cost of BSV.
  • Uncertainty with respect to the founders of the project. After the survey, it turned out that most representatives of the crypto community have a negative attitude towards the founders of BSV. So, Craig Wright is known as a cheater who can only make loud statements in public, and Calvin Eyre is just a businessman who wants to make money.