A number of customers have asked how Gemini will respond if the Bitcoin network splits into two separate Blockchains (often called a “hard fork”) sometime soon. Our highest priority at Gemini — more important even than keeping our exchange open — is ensuring that all of our customers’ asset balances are held securely.
We know that some of our customers have strong opinions on how Bitcoin should evolve. At Gemini, however, it’s not our place to drive the discussion. In the event of a hard fork, we will carefully consider our response and how to move forward. We understand that our customers have diverse opinions on this subject, and we will do our best to incorporate your suggestions.
If there is a hard fork in the near future, it is unlikely to be a “clean” fork in which almost all hashpower, exchange volume, and economic activity happens on only one Blockchain. We certainly prefer and encourage a “clean” fork, no matter which side of the scaling debate wins, but we are preparing for a variety of outcomes.
In the event that we detect a hard fork or anticipate an imminent hard fork, we will temporarily suspend BTC deposits and withdrawals. During that time, we will evaluate our response and post updates here on this blog. We will endeavor to resume deposits and withdrawals as soon as we’re safely able to do so.
However, as an indication of what we are currently planning:
- The “BTC” balance and trading activity you see on Gemini will likely reflect the chain with the greater total difficulty.
- We may choose to eventually open new order books for the chain with less total difficulty.
- We will make every effort to support withdrawals of the chain with less total difficulty, if it ends up having a significant amount of hashpower, exchange volume, or economic value. However, unlike with the Ethereum / Ethereum Classic hard fork last year, we cannot yet guarantee that we will succeed in this effort, due to a lack of two-way replay protection in Bitcoin Unlimited.
We understand that the policies listed above leave quite a lot to Gemini’s discretion. We would rather have clearly defined policies in place right now; however, it’s unclear what will happen on the Blockchain in the coming days, weeks, and months, and we would much rather play it safe than make hasty, ill-informed decisions and risk mismanaging your funds. As soon as we gain further insight on the situation, we will make additional blog posts to better detail how your funds on Gemini will be secured.
Onward and upward,