User guide to managing BCH coin splitting
On November 15, 2018, the Bitcoin Cash (BCH( blockchain underwent a contentious hard fork with two competing rule sets: (1) one path championed by Bitcoin ABC that began a path to radically alter the original Bitcoin protocol designed by Satoshi Nakamoto; and (2) one championed by Bitcoin SV (Satoshi Vision) which sought to preserve the original Satoshi protocol and return Bitcoin closer to its original state.
In subsequent days, Bitcoin ABC unilaterally introduced further consensus changes that introduced vulnerabilities to the BCH network, and abandoned the fundamental principle of Proof of Work as the security model of Bitcoin.
The end result of these events is that Bitcoin Cash has now split into two persistent chains: Bitcoin SV (ticker: BSV) and Bitcoin Cash (ticker: BCH). Bitcoin SV no longer recognises BCH as Bitcoin. However, users who held BCH prior to the hard fork on November 15,, 2018 now have coins on both chains. For the stability of the markets, such users must be given effective means to deal with those coins safely.
Given that neither side of the hard fork introduced transaction repay protection, it is now possible that when sending a transaction of BSV, the same transaction can be validly replayed on BCH. This may not be the desired result and can cause confusion to users. In order to prevent this behaviour, the coins must somehow be separated. There are several techniques for doing so with various levels of complexity.
If you have no need to transact your coins in the near future, the best option is to wait and conduct no transactions now. A consensus level fix to this problem will be implemented in due course. As Bitcoin ABC has consistently refused to do so either unilaterally or mutually with Bitcoin SV, the Bitcoin SV project team has made the decision to do so itself in order to promote stability for users and economic participants on both blockchains.
A consensus level fix is being developed that will prevent this being issue for users of either chain. However, to minimise disruption, it must be widely supported by wallets, exchanges and other economic actors in the Bitcoin ecosystem. We will announce a timeline for this fix once an adequate level of ecosystem readiness is apparent. This is unlikely to be before the New Year 2019. However, once implemented, there will be no further need for user action other than a wallet upgrade.
If you wish to transact with your coins before this ecosystem wide fix is implemented, you will need to split your current BCH coins. There are several mechanisms to do. However, it is first recommended that you create a new wallet for each chain to hold your separated coins.
Wallets known to support BSV are listed on the BSV implementation website: https://bitcoinsv.io/services/
Several exchanges will perform the coin-splitting function for you. However, in selecting an exchange, it is important to first check that it actually does offer this service. Some exchanges have stated that if unsplit coins are sent to them, they make no guarantees that you will get access to both coins. Once deposited, you can either sell one or both coins or simply withdraw them into separate wallets.
Exchanges that have openly stated they support splitting of BCH coins sent to their wallets include:
Caution: Do not assume that because an exchange has trading pairs for BSV (or BCH-SV) and BCH that it is guaranteed to support coin splitting. It is recommended you contact the exchange to confirm this before sending any coins, or send a very small amount first as a test.
We will update the above exchange list as we confirm support for coin splitting behaviour with more exchanges.
Coin splitting tools
There are several coin splitting tools currently available. However, we cannot recommend any of them at this stage. Running coin splitting software gives that software access to your coins and without a high level of assurance that the software is not malicious, there is always the risk of coin theft.
The Bitcoin SV team is developing its own endorsed coin-splitting tool, which will be released and announced on https://bitcoinsv.io/news/ as soon as possible. Additionally we will be reviewing existing tools and providing a list those we consider safe.
Further methods will be available soon
In addition to the above, the Bitcoin SV team will be providing additional well-tested mechanisms in the near future, including a wallet customised to automatically coin split. These tools will also be announced on https://bitcoinsv.io/news/ as soon as they are ready. Meanwhile, we urge caution as the uncertain environment creates many opportunities for fraudulent services to take advantage of user confusion. The official Bitcoin SV website will not recommend any service or software for this purpose unless we have thoroughly tested and reviewed it ourselves. We will also provide best practice procedures for using any coin-splitting services or software.