What is Bitcoin Gold (BTG), and why was it created? | RateCity

Bitcoin was conceptualised as a decentralised digital currency - a currency independent of any single authority and managed by a network of peers who keep the blockchain secure. However, the proof-of-work mechanism used to verify transactions and mine coins on the Bitcoin blockchain requires enormous computing power and cannot be run on standard computers. To mine Bitcoins, one needs to use expensive hardware, like Application-Specific Integrated Circuits (ASICs).

As one cannot use regular computers for mining Bitcoin and ASICs are very expensive (they cost thousands of dollars), the number of people who can afford to mine Bitcoins is slowly reducing. If the number of miners (or peers) on the Blockchain network continues to decline, the system could become centralised, with only a few people controlling the majority of the blockchain.

Bitcoin Gold was announced as a hard fork of Bitcoin in 2017 to "preserve the independence of the Bitcoin ecosystem from miner's influence". A hard fork of a cryptocurrency is generally created to develop a whole new digital currency on an independent blockchain, usually to move away from certain aspects of the original crypto that are considered unfavourable. The community behind Bitcoin Gold wanted to move away from the processor-intensive protocol used to mine Bitcoin to allow more people to participate in the mining operation and restore the blockchain's decentralisation in the process.

Unlike the energy-intensive proof-of-work algorithm used to mine Bitcoin, Bitcoin Gold uses a memory-intensive proof-of-work algorithm (known as Equihash) that can be solved with a standard Graphics Processing Unit (GPU) available in regular computers and smartphones. This allows anyone who owns a computer to become a miner if they wish to. As a result, the Bitcoin Gold network has the potential to have a consistently high number of miners (or peers), keeping the blockchain decentralised.

Even though Bitcoin Gold operates differently from Bitcoin, the process of buying and selling Bitcoin Gold is the same as various other cryptocurrencies. To purchase Bitcoin Gold, you need to create an account on a cryptocurrency exchange, transfer funds into it and exchange the money for the desired amount of Bitcoin Gold. 

Before signing up on a cryptocurrency exchange, be sure to compare crypto exchanges to pick an exchange that offers the features you need, such as low transaction fee, an easy-to-use interface, and good customer support. It's also worth checking if an exchange is registered with AUSTRAC to ensure it complies with local laws and regulations.