Bitcoin Gold vs. USD – Cryptocurrencies

Instrument description

Cryptocurrency has revolutionized digital transactions, and it all started in 2009 when Bitcoin was launched, which worked on block chain technology that is a decentralized peer to peer transaction that does not require any intermediary such as banks or government financial institutions to monitor the transaction.

The regular Forex currencies such as USD (United States Dollars), EUR (Euro), and GBP (Great Britain Pound) are called Fiat currencies and regularized by governments and banks.

A block chain consists of programmable blocks, and each block has information of the users/traders, dates, time, and amount. The blocks together form a chain, and all the transactions are recorded on a ledger that is encrypted by cryptography, which ensures complete security from any hacks or misuse.

Bitcoin was a benchmark and pioneer in cryptocurrencies, and later many other digital currencies were developed and became popular such as Ethereum, Ripple, and Monero. The new currencies were developed as a result of ‘fork.’

In block chain technology, a fork is defined as

• A change in protocol that decides if the transaction is valid or not
• When a block chain diverges into two paths; or
• When two blocks have the same height

The block chain forks are divided into two categories that are soft forks and hard forks. A soft fork is one that is backward compatible, which means that older nodes will still recognize new transactions as valid, but any block which is mined will be rendered invalid by new nodes.

A hard fork is one that alters the backward compatibility. The nodes will consider all the new transactions as invalid and will need to be updated to new protocol software. Bitcoin Gold is an example of a hard fork of Bitcoin. The best advantage of Bitcoin Gold is that all transactions and wallets stay anonymous; however, users can know the direction where the coins come and go.

What is the BTG/USD currency pair?

The Bitcoin Gold (BTG) pairing with US Dollars (USD) is denoted by BTG/USD and is regarded as one of the most prominent cryptocurrency crosses in the world. Bitcoin Gold was introduced as an attempt to increase the GPU (Graphics Processing Unit) mining functionality of Bitcoins as compared to Application-Specific Integrated Circuits (ASIC).

The ASICs were giving control to a few big players, while GPU mining means that every user gets an equal chance to mine the Bitcoin. Now anyone having a computer with a GPU card can mine BTG. The Bitcoin Gold can be bought from CoinSwitch, which is one of the biggest cryptocurrency conversion platforms.

The example of BTG/USD is a currency exchange that is like BTC/USD, where BTC (Bitcoin) represents the base currency, and USD (United States Dollar) represents the quote currency. Similarly, in the cryptocurrency pairing, BTG/USD shows Bitcoin Gold as the base currency, and USD is the quote or counter currency. The BTG/USD pair indicates the number of US Dollars needed to buy one Bitcoin Gold. The current exchange rate is 1 BTG = $8.401

History of BTG/USD Pair

Bitcoin Gold or popularly known as (BTG) is a cryptocurrency. BTG is an open-source hard fork of Bitcoin that occurred on October 24, 2017; the block height was 491,406. The purpose was to make ‘Bitcoin’ decentralize again. Bitcoin was already a decentralized digital currency with no influence of banks or government. Jack Liao founded Bitcoin Gold along with five other people. Jack Liao was CEO (Chief Executive Officer) of LightningAsic and BitExchange, which was a mining software company.

The main reason for launching Bitcoin Gold was to do with the mining process and changing the proof work of algorithm. The new mining algorithm (Equihash) was implemented in July 2018. The Bitcoin uses the ‘SHA-256 Algorithm’ while Bitcoin Gold uses the ‘Equihash Algorithm.’

The Bitcoin Gold developers emphasized other aspects of cryptocurrencies, such as transparency, distribution, and protection. The short term and long term success of Bitcoin Gold depend on its availability on the cryptocurrency exchanges where users and traders can make transactions.

Since July 2018, Bitcoin Gold is traded live on exchanges such as Bitfinex, Uphold, Abucoins, Evercoin, Coinswitch, Binance, and many others. Bitcoin is also available through wallet services such as Ledger Wallet, Bitpie, BTGWallet, Exodus, and Kasse. BTG has a feature of replay protection that prevents funds loss and transaction replay. Bitfinex is a Hong Kong-based company that allows trading of BTG/USD pairs and BTG/BTC pairs.

The current market capitalization $148 million, and the current circulation supply is 17.1 million, and the total supply is capped at 21 million. The all-time high price BTG was $539.72 on October 23, 2017, and the all-time low was $4.31 on March 13, 2020.

US Dollar is the most widely accepted and recognized currency of the world. The USD dominates the Forex market and accounts for more than 90% of all the transactions. USD is paired with nearly every other major and minor global currency. USD is also paired with different cryptocurrencies and use as a benchmark to value the commodities.

How to analyze the BTG/USD Price Chart

If we analyze at the price chart of the BTG/USD pair, we see that value remained with the range of $10.000 to $15.000 from the second week of January 2020 to the last week of February 2020. Then there was a rapid decline in the middle of the second week of March, and the BTG/USD pair fell to the lowest value of $5.126 on March 12, 2020. The BTG/USD pair is seeing uptrend since the second week of April 2020 with constant fluctuations, and the highest value of $11.647 was recorded on August 17, 2020.

Currently, BTG/USD pair trades on $8.40. The Bid price is 8.42, while the Ask price is 8.45.

If you speculate that the value of BTG will rise as compared to USD, then you go long or Buy, and similarly, if you think the price of BTG will fall against USD, then you go short or Sell.

What causes price change in the BTG/USD pair?

The analysis of BTG/USD can be tricky, as one is a digital currency, and one is a fiat currency. There are different factors that affect the prices of both Bitcoin Gold and US Dollars. As Bitcoin Gold is derived from Bitcoin so the factors that impact BTC also affect the value of BTG, such as

• The supply and demand of Bitcoin
• The total cost of mining the Bitcoins
• The number of competing cryptocurrencies
• The rules and regulation regarding the adoption of Bitcoins
• The internal governance of Bitcoin

US Dollars is the world's most popularly traded currency, and not only the number one reserve currency, but nearly all the commodities are valued in US Dollars. The value of USD is regularized by the Federal Reserve System known as (Fed). The price of USD also reflects the economy of the USA and depends on macro-economic such as interest rate, Gross Domestics Product (GDP), inflation, and developing global political events.

The information above is for education purposes only and cannot be considered as investment advice. Past performance is not reliable indicator of future results.