What is Bitcoin Classic? How it Works?

Bitcoin Classic is one of the Bitcoin reference implementation Bitcoin Core started to increase the bitcoin transaction processing capacity by increasing the block size limit. Bitcoin Blocks which contains the Bitcoin transaction data forms the basic structure of the immutable blockchain. Bitcoin Classic is started similar to the Bitcoin XT fork, which never managed to the get the support it needed. Bitcoin Classic in its first eight months promoted a single increase of the maximum block size from one megabyte to two megabytes. In November 2016 this changed and the project moved to a solution that moved the limit out of the software rules into the hands of the miners and nodes.

Read also What is Bitcoin ATM?

Bitcoin Classic is also an effort to move the scientific governance of the decentralized and independent real Bitcoin project from the developers of Bitcoin Core to a voting process involving a larger community of miners, businesses, developers, and users. There is no formal activation method for the software, but due to the nature of Bitcoin, a supermajority needs to support it.

Bitcoin Classic

Bitcoin Classic

In Bitcoin, transactions are collected into bitcoin blocks, and each block is produced by the bitcoin network on every ten minutes. With Bitcoin’s current limit of one megabyte, this capacity translates to an estimated average of three transactions per second. With Bitcoin Classic’s proposed doubling of the block size limit to two megabytes, the maximum transaction rate would also roughly double. If deployed, Bitcoin Classic will render the current Bitcoin software obsolete, as it changes protocol parameters, namely increasing the maximum block size from one megabyte to two megabytes. Most implementations of Bitcoin software would require small modifications to the block size limit to continue to work.

Bitcoin Classic has received support from some Bitcoin companies, developers, investors and miners, such as Coinbase, Bitstamp, Circle, Jeff Garzik, Roger Ver and Gavin Andresen. The Wall Street Journal said “Bitcoin Classic has developed from the ashes of the XT versus Core debate. It is the new version of Bitcoin which allows for a two-megabyte limit. It appears to be quickly winning support.” However, a hard fork was not seen as an urgent issue by the wider bitcoin community. Opponents argued that expanded size of blocks will lead to expanded system resource requirements for operating the full node, which in turn will lead to greater centralization. The software’s peak use was observed in early 2016 with a steady decline in usage from March 2016 onwards.

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