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What I think all the press isn't making very clear is that to the best of my understanding for every Bitcoin you own, you get a Bitcoin Cash coin. There is no "

What I think all the press isn't making very clear is that to the best of my understanding for every Bitcoin you own, you get a Bitcoin Cash coin. There is no "conversion", it is free money for all BTC holders. Everyone who owned BTC, now owns BTC+BCC. Of course if your BTC is not real, but is held by an exchange such as Coinbase, how you get your BCC isn't at all clear.

jncraton 9y ago
> Of course if your BTC is not real, but is held by an exchange such as Coinbase, how you get your BCC isn't at all clear. Your BTC should still be "real", but the exchange holds the keys instead of you. Your point stands about it being unclear how you would access your BCC. If you aren't allowed access to your BCC, there's nothing preventing exchanges from dumping the BCC for cash as far as I can tell from a purely technical standpoint (IANAL).
- simias 9y ago
  What if the exchange didn't actually hold the BTC but only had a line in the database with an "IOU xBTC"? Maybe at this point the exchange had used its stored BTC to speculate on an other market and attempt to increase its profets. Maybe they bought Ether or gold or Microsoft stock. Normally it doesn't matter as long as the exchange is capable of sending you back the coins when you claim them but in case of a fork they'd have to buy two coins instead.
  - jncraton 9y ago
    That's certainly a possibility. I was working from the assumption that Coinbase actually held BTC totaling the sum of all users account balances. Given the highly volatile nature of BTC and the nature of the BTC community (e.g. the conventional wisdom was to pull all funds from exchanges prior to the fork occurring), it seems quite irresponsible to not be holding funds as BTC. I'm aware that exchanges in the past have behaved very irresponsibly, but I'm hoping that Coinbase is the exception here as a well known US-based company.
- jo909 9y ago
  There is also nothing preventing exchanges from dumping "your" BTC for cash from a pure technical standpoint. Because technically, all you have is the promise of the exchange to transfer you the right amount of BTC out of your account whenever you request them, or the same market value in another (supported) crypto/fiat currency. This is not only a pinky-swear promise but one protected by some laws and contracts. But it is very questionable to me if there is (or should be) any obligation for any exchange to pay you any amount of BCC that magically appeared overnight.
- apk-d 9y ago
  Exchanges don't keep a real BTC wallet for each user. When one Coinbase user sends funds to another, the transaction is entirely virtual (which lets them avoid paying the network transaction fee).
  - jncraton 9y ago
    I'm aware of this, but they should still have enough BTC in storage to cover the BTC in all accounts. This means they should also have BCC for each user.
    - jdmichal 9y ago
      That's an assumption that may or may not be true. Is there any reason why Coinbase could not be operating on a fractional reserve? Or, if we want to consider Coinbase as managing a discrete asset instead of managing deposits... Shorting stocks "loans" out a stock that technically belongs to someone else; there two "positive owners" and one "negative owner" until the position is covered. So they can also operate on a fractional reserve.
      - jncraton 9y ago
        You are correct. However, Coinbase does state that they simply store the funds: "Customer deposits are not sent anywhere. Unlike other financial institutions, we do not lend out customer funds. 100% of your funds are securely stored." https://support.coinbase.com/customer/portal/articles/667213-does-coinbase-use-customer-deposits-for-anything- https://support.coinbase.com/customer/portal/articles/667213...
downandout 9y ago
This, I believe, is the basis of the unjust enrichment claim. Coinbase technically owns the BTC in its wallets, and you can bet even though they aren't supporting it, they are receiving the associated BCC. They just aren't passing it on to the beneficial owners (their clients).
- fauigerzigerk 9y ago
  Would that not only become relevant if BCC were to become more valuable (say in USD) than BTC? As of now, Coinbase is sitting on the fence basically (just like everyone else who holds their own private key and hasn't made a transaction since the fork). They can decide to use their (users') coins on either blockchain but not on both. So what Coinbase has is similar to a call option on BCC.
  - thaumasiotes 9y ago
    > They can decide to use their (users') coins on either blockchain but not on both. Please stop saying this. Read your own grandparent comment: > There is no "conversion", it is free money for all BTC holders. Everyone who owned BTC, now owns BTC+BCC. It isn't possible to spend BTC on the BCC blockchain, because coins spent on the BCC blockchain are BCC by definition. Once you've spent your BCC on the BCC blockchain, you still have your BTC on the BTC blockchain; that's what a fork means.
    - fauigerzigerk 9y ago
      I see what you mean. That's pretty amazing. Thanks for explaining. I would have expected the two forks to coordinate sufficiently to make sure double spending is not possible. But I see how this would have been extremely difficult if not impossible without one of these two rival camps agreeing to be the opt-in network while the other one remains the default.

jncraton 9y ago

> Of course if your BTC is not real, but is held by an exchange such as Coinbase, how you get your BCC isn't at all clear. Your BTC should still be "real", but the exchange holds the keys instead of you. Your point stands about it being unclear how you would access your BCC. If you aren't allowed access to your BCC, there's nothing preventing exchanges from dumping the BCC for cash as far as I can tell from a purely technical standpoint (IANAL).

simias 9y ago
What if the exchange didn't actually hold the BTC but only had a line in the database with an "IOU xBTC"? Maybe at this point the exchange had used its stored BTC to speculate on an other market and attempt to increase its profets. Maybe they bought Ether or gold or Microsoft stock. Normally it doesn't matter as long as the exchange is capable of sending you back the coins when you claim them but in case of a fork they'd have to buy two coins instead.
- jncraton 9y ago
  That's certainly a possibility. I was working from the assumption that Coinbase actually held BTC totaling the sum of all users account balances. Given the highly volatile nature of BTC and the nature of the BTC community (e.g. the conventional wisdom was to pull all funds from exchanges prior to the fork occurring), it seems quite irresponsible to not be holding funds as BTC. I'm aware that exchanges in the past have behaved very irresponsibly, but I'm hoping that Coinbase is the exception here as a well known US-based company.
jo909 9y ago
There is also nothing preventing exchanges from dumping "your" BTC for cash from a pure technical standpoint. Because technically, all you have is the promise of the exchange to transfer you the right amount of BTC out of your account whenever you request them, or the same market value in another (supported) crypto/fiat currency. This is not only a pinky-swear promise but one protected by some laws and contracts. But it is very questionable to me if there is (or should be) any obligation for any exchange to pay you any amount of BCC that magically appeared overnight.
apk-d 9y ago
Exchanges don't keep a real BTC wallet for each user. When one Coinbase user sends funds to another, the transaction is entirely virtual (which lets them avoid paying the network transaction fee).
- jncraton 9y ago
  I'm aware of this, but they should still have enough BTC in storage to cover the BTC in all accounts. This means they should also have BCC for each user.
  - jdmichal 9y ago
    That's an assumption that may or may not be true. Is there any reason why Coinbase could not be operating on a fractional reserve? Or, if we want to consider Coinbase as managing a discrete asset instead of managing deposits... Shorting stocks "loans" out a stock that technically belongs to someone else; there two "positive owners" and one "negative owner" until the position is covered. So they can also operate on a fractional reserve.
    - jncraton 9y ago
      You are correct. However, Coinbase does state that they simply store the funds: "Customer deposits are not sent anywhere. Unlike other financial institutions, we do not lend out customer funds. 100% of your funds are securely stored." https://support.coinbase.com/customer/portal/articles/667213-does-coinbase-use-customer-deposits-for-anything- https://support.coinbase.com/customer/portal/articles/667213...

downandout 9y ago

This, I believe, is the basis of the unjust enrichment claim. Coinbase technically owns the BTC in its wallets, and you can bet even though they aren't supporting it, they are receiving the associated BCC. They just aren't passing it on to the beneficial owners (their clients).

fauigerzigerk 9y ago
Would that not only become relevant if BCC were to become more valuable (say in USD) than BTC? As of now, Coinbase is sitting on the fence basically (just like everyone else who holds their own private key and hasn't made a transaction since the fork). They can decide to use their (users') coins on either blockchain but not on both. So what Coinbase has is similar to a call option on BCC.
- thaumasiotes 9y ago
  > They can decide to use their (users') coins on either blockchain but not on both. Please stop saying this. Read your own grandparent comment: > There is no "conversion", it is free money for all BTC holders. Everyone who owned BTC, now owns BTC+BCC. It isn't possible to spend BTC on the BCC blockchain, because coins spent on the BCC blockchain are BCC by definition. Once you've spent your BCC on the BCC blockchain, you still have your BTC on the BTC blockchain; that's what a fork means.
  - fauigerzigerk 9y ago
    I see what you mean. That's pretty amazing. Thanks for explaining. I would have expected the two forks to coordinate sufficiently to make sure double spending is not possible. But I see how this would have been extremely difficult if not impossible without one of these two rival camps agreeing to be the opt-in network while the other one remains the default.