For those who are new to cryptocurrencies, July 1st, 2017 marks the first day when Australia will adopt bitcoin as a form of currency. This means that bitcoin will not be taxed as a capital asset in the country. Additionally, the “coin” could be used to purchase products and services around the nation/continent. Please note, however, that acceptance as a “form of currency” does not equate to adoption as a “form of legal tender”. In other words, Australian vendors are free to choose whether they want to accept bitcoin, or not. Regardless of their decision, the Australian government will honor bitcoin as a form of payment. Conversely, a “form of legal tender” would guarantee consumers the right to fulfill any debts formed in a transaction – meaning merchants will have to accept bitcoin if the consumer presents it as a form of payment. Despite the semantics, this is a giant positive step towards global adoption of cryptocurrencies.
Today, June 21st, also marks a crucial day for bitcoin, in that the code for Segwit2x will be released to bitcoin miners around the world. This code will be installed to mining pools to allow 2MB block-size transactions. Supposedly, the increase in block-size parameters would fix a lot of the scaling issues that plague the cryptocurrency. If a large majority of mining pools successfully run the code for a certain number of blocks, within four to five days, then Segwit will lock in. In other words, this code will be the new standard for miners to execute 2MB block-size transactions. Bitcoin miners will have up to three months to upgrade their software to support the new 2MB block-size parameter.
Of course, even if the new code runs smoothly and locks in Segwit successfully, the new software deployment cannot happen until the old code deployment expires. This expiration occurs on August 1st, 2017. Most mining pools will lock into the new code on this date, presuming everything goes according to plan. If this happens, August 1st marks the new beginning of a new “upgraded” bitcoin, which will allow 2MB block-size transactions. This is an immense positive development for bitcoin to avoid obsolescence. With a profusion of new cryptocurrencies popping out of the woodwork, bitcoin needs to evolve in order to keep up with the times (and technology). Segwit is just what this cryptocurrency needs to stay relevant, into the future.
*There’s another method for increasing bitcoin’s capability for handling larger block-size transactions, which involves pushing code modifications to the community and forcing miners to adopt these new changes. However, many proponents in the cryptocurrency community do not endorse this method.