The basics of margin trading explained using the new bitcoin cash bcc or bch as an example
Therefore it does look like an area worth examining. To many, the ultimate objective of Bitcoin is to become sufficiently dominant, such that there is a significant decrease in credit expansionary forces, which can neutralize the credit cycle and therefore the business cycle.
Although, this should be considered as an extremely ambitious objective, which we consider as extremely unlikely. Anyone can create a chain fork of Bitcoin at any time. The possibility of a SegWit2x hardfork B2X in November requires that we, once again, clarify our position on any and all potential hardforks.
At BitMEX, our top priority is protecting the assets of our customers. In order for us to effectively do this, we insist that any Bitcoin hardfork includes the following: Strong replay protection and wipeout protection, in particular, are considered absolutely crucial.
Should a hardfork not follow these policies, we will not support the new coin. To be clear, we do not intend to access or keep these coins. Additionally, support of any forked currency is solely at the discretion of BitMEX. If this concerns you, you should withdraw your funds before any given fork and handle the split on your own.
The SegWit2x B2X proposal is aimed at increasing the blocksize. It is scheduled to take place in November This change is incompatible with the current Bitcoin ruleset and therefore a new coin may be created. Proponents of this new coin hope it becomes known as Bitcoin, however which coin is known as Bitcoin is not up to the proponents of the new token.
Investors and traders may decide which coin has the highest value. It is our understanding that the SegWit2x proposal does not include two way transaction replay protection, enabled by default.
This policy applies even if the SegWit2x chain has the majority hashrate. BitMEX considers any and all contentious hardfork tokens as altcoins.
The upcoming SegWit2x hardfork lacks replay protection. In this piece we look at what you can do to protect yourself, by analyzing various ways you could split your coins. This is an increase in the maximum block weight to 8MB from 4MB. In many ways this is similar to the recent Bitcoin Cash hardfork also an increase in the blocksize limit to 8MB. A key difference is that unlike Bitcoin Cash, B2X does not include strong transaction replay protection.
Therefore many users could lose funds, on the other hand, those that do successfully protect their funds could make positive investment returns. The hardfork is expected to occur on around Saturday 18th November This is likely to lead to significant price volatility, which may present investment opportunities. Due to the lack of replay protection, whatever your view on the situation or your investment strategy, it is sensible to split your coins as soon as possible, to ensure as much flexibility as possible and also to protect your coins.
Many users are likely to intend to send only one of the two coins in a transaction, but accidentally send both, which may result in an irrecoverable loss of funds. If you do not split, you could be one of these users incurring losses.
For example scammers could repeatedly deposit and withdraw from exchanges, hoping to find any weaknesses. If any exchange has not implemented replay protection, attackers are likely to exploit this quickly, which could make the exchange insolvent.
In addition to this, individual users could be targeted by scammers. Scammers could sell the victim Bitcoin, knowing their wallet is following the wrong chain or scammers could acquire Bitcoin from a victim who is expected to replay coins on both chains to the buyer. These kind of losses and attacks could damage the reputation of the ecosystem, therefore a contentious hardfork without strong replay protection is a high risk event with potentially significant negative consequences.
However, there are actions you can take to protect yourself. Since the B2X hardfork does not contain transaction replay protection enabled by default, when spending your coins, in either chain, the transaction could be replayed on the other chain.
Therefore the prudent thing to do is split your coins, so that your BTC and B2X exist on different outputs on each chain, which means that your transactions can no longer be replayed. Unfortunately this is not a simple process and many people are unlikely to be able to achieve this. You cannot split your coins prior to the hardfork, however a prudent strategy may be to prepare how you plan to split beforehand, for example moving your coins to a different wallet before the fork occurs.
For many users this is not likely to be easy, however if you act fast, there could be investment rewards, if you are able to sell the spin-off coin before others have a chance to do so. In order to split your coins, you would either need to manually construct your own transactions or use two wallets, one for BTC and one for B2X, since most wallets will not allow you to broadcast two conflicting transactions.
You will then need two separate wallets, to receive the coins on each side of the split. A full node wallet means it verifies all the consensus rules on the entire blockchain. Two fully verifying nodes may be needed because:.
You need to ensure each respective wallet enforces each of these rules, to make sure your wallets do not follow a different chain to the one on which your coins are located on. Otherwise your coins could disappear from your wallet. In order to prudently prepare for the hardfork, it might be a good idea to run full nodes of each client on a separate computer. The syncing process can take several days, therefore perhaps you could start to run the nodes before the fork, as you may want to be ready to split your coins and spend them as soon as possible.
The most basic way of splitting is to run a BTC client and a B2X client, import your private keys, and then try to send your coins to yourself, to two different outputs on each chain.
Either both transactions confirm, in which case you succeeded, or the same transaction occurs on both chains, and you simply try again. The trouble with this method is that it could be expensive, in terms of both time and money. Many people may try this approach and therefore network congestion could be high, and the more failed attempts occur the more one needs to pay in fees. In addition to this, at least one of the two chains is guaranteed have minority hashpower, which could increase the block interval in the short term, resulting in more transaction congestion and you would need to wait for your transaction to confirm on both sides of the split to ensure you are protected.
Therefore, by default your B2X wallet will broadcast its transactions to the BTC network, making transaction replay likely. Locktime is a transaction field, which ensures a transaction is only valid after a certain block height. By default some wallets, including Bitcoin Core, add the current block height to the locktime field for their transactions.
There are several motivations for this transaction type, one of which is to reduce the incentive for miners to orphan the current leading block, in order to get more fee income, by scooping up the fees from transactions already confirmed in the last block and the transactions in the memory pool.
This is expected to be a potential problem in the future when the block reward is low. For example, if the BTC chain has a 5 block lead over the B2X chain, you could send a BTC transaction with the current block height as the locktime, therefore this transaction will be invalid on B2X for the next 5 blocks.
If the transaction confirms on BTC, you could then send another different transaction spending the same output on the B2X network, before the 5 block period is over. This could also work the other way around if B2X has the block height lead.
This method sounds complicated, and involves monitoring both chains. However, using the Bitcoin Core wallet this may happen by default and can be combined with the trial and error method described above.
In theory, all you need to do is see which chain is in the lead, with respect to block height, and then send your transaction on that chain first. The B2X chain is considering adding opt in replay protection. This essentially means B2X client defines a subset of existing valid transactions and then prohibits these transactions on the B2X chain. Therefore you could send a transaction in this format on the BTC network and it would be invalid on B2X, resulting in a successful split.
However, this could be technically challenging to do, as it is not clear if any BTC wallets will support this feature and there may not be enough time for wallets to implement this for ordinary users. In addition to this, it is not known what type of opt in replay protection B2X will use or if this feature will be enabled at all.
The official B2X client appears to have gone through the following iterations:. Taint the coins with already split coins. Somebody else may have successfully been able to split their coins. They could then send you an output from their split coins. You could then use this output as an input for your new transaction. Since this input only exists on one chain, your transaction would be invalid on the other chain.
Ideally this could be the coinbase reward from a block mined after the split, that way you can be sure your transaction can only occur on one side of the split, regardless of any potential re-orgs. This process seems easier than the above methods, although you must ensure you get your coin control in your wallet arranged correctly to ensure you spend the desired transaction input.
This method requires waiting for somebody else, therefore it could be slow, which may be a problem if you want to split as soon as possible. You could send your coins to an exchange which supports both BTC and B2X, the exchange could then handle the split for you. You need to check if the policy of the exchange is to split your coins before the split or to also split coins sent to them after the split. A disadvantage of this policy is that your need to take counterparty risk, which you may not want to do with your long term savings.
Taking such a risk could be particularly problematic during a high risk, high volume period such as a chain split without strong replay protection, which may present operational challenges for the exchanges.
This method also goes against a common narrative or mantra in the Bitcoin community, which is you should always control your private keys, especially during a hardfork. Although an advantage of sending your coins to the exchange before the fork, is that you may be able to trade the two coins very quickly, perhaps even faster than those doing the above split methods.
This could provide you better investment opportunities. Perhaps the best strategy is to combine the above methods. After reviewing the policy of the exchanges, you could send some of your coins to an exchange of your choice before the fork and then attempt to split the remainder of your coins using method 2 explained above.
Therefore if you do any above, you are probably well ahead of the majority, which could hopefully lead to some financial rewards or at least help you avoid losses. The upcoming SegWit2x hardfork is likely to lead to price volatility. In this piece we look at some potential investment strategies which could allow you to capitalize on the event. The most popular investment strategy following the split is likely to be to take no action and remain a holder of both BTC and B2X.
This is probably the most prudent approach, as your assets may be protected whichever coin becomes more valuable. Most people may pursue this strategy out of laziness rather than choice. However, even if this is your preferred investment strategy, it may still be sensible to try and split your coins anyway; to increase the flexibility of your investment strategy and protect your funds in case you need to make a transaction. Invest in your favored coin. Many investors may support either the BTC or B2X coin for ideological reasons or because they feel their chosen coin has the best characteristics.
Somebody slightly favouring one of the visions but also wanting to hedge their bets may have less of an impact than a die hard supporter of one of the visions, who is willing to sell all their coins on one side of the split no matter what.
The most common investment strategy after the fork may be to do nothing. However, of the tiny minority of people that do act, many of those people may be sellers of B2X. This is because the section of the minority that took action in favor of the large block chain in August, will not be allocated either BTC or B2X for the coins they sold for Bitcoin Cash.
Although, obviously this is highly speculative and nobody really knows what will happen. In this case B2X is the spin-off token. There are plenty of reasons why a company might choose to unload or otherwise separate itself from the fortunes of the business to be spun off. There is really only one reason to pay attention when they do: The facts are overwhelming. Stock of spin-off companies, and even shares of the parent companies that do then spinning off, significantly and consistently outperform the market averages.
The bad company or spin-off company is typically sold by investors, with the negative narrative around the bad company dominant at the time of the split, causing negative sentiment.
The spin-off process itself is a fundamentally inefficient method of distributing stock to the wrong people. Supposedly shrewd institutional investors also join in the selling. Most of the time spin-off companies are much smaller than the parent company. A spin-off may be only 10 or 20 percent the size of the parent.
In many ways there are some analogies between the opportunities which may arise from Bitcoin spin-offs such as B2X and stock spin-offs. Bitcoin investors typically value robust rules and the resulting highly resilient monetary properties. However, this could provide contrarian investors an opportunity.
The price of B2X could fall to cheap levels and there could be significant amounts of negative sentiment with some people writing the coin off. This could then be a good time for contrarians to invest in B2X. However, there may be little investment basis for this view.
However, whether the Greenblatt spin-off philosophy really applies to Bitcoin spin-offs such as B2X is not clear. Greenblatt still does fundamental analysis on the bad spin-off company, and whether one can take this type of fundamental approach to Bitcoin or its spin-offs, is not obvious. Take advantage of different policies on different exchanges. During the Bitcoin Cash hardfork, different financial platforms had different policies. However, Kraken for example, supported Bitcoin Cash, in such a way that those with long margin positions on Bitcoin were also given Bitcoin Cash.
Critically on Kraken if you were short Bitcoin at the time of the fork, you were then automatically short Bitcoin Cash. These different policies between exchanges provide asymmetry, which in theory can be used to earn free money.
Thereby after the hardfork, you receive one Bitcoin Cash token on Kraken, essentially for free, since there was no corresponding Bitcoin Cash liability on BitMEX associated with the short. When it comes to the upcoming fork, there are four relevant potential exchange policies one needs to consider, when trying to engage in this type of arbitrage.
Potential financial platform policies regarding the B2X spin-off token. An interesting investment strategy to engage in before the B2X fork could be to open long Bitcoin positions with exchanges with policy C and D, and potentially open short Bitcoin positions on exchanges with policies A, B and C.
In theory, this should allow you to get B2X tokens for free. One may think that policy C may seem a slightly inappropriate choice, as it results in an asymmetry. However some exchanges did have a policy similar to this with respect to Bitcoin Cash. The rational for this was that the burden on customers who were short Bitcoin, to go out into the market and buy Bitcoin Cash may have been too high, particularly if the liquidity of Bitcoin Cash was low.
As the B2X fork approaches, we may write a piece summarizing the policies of the main exchanges and how one could engage in this type strategy. Although, if you wait for it to be clearly explained, it could be too late and spreads could have already opened up, reflecting the opportunity. Perhaps a good idea, if you really like taking risks, may be to review the policies exchanges took with respect to Bitcoin Cash, to get an idea of what their policies might be with respect to B2X and then open your positions before the policies are officially announced.
To anchor the price of the swap back to the spot market, an interest payment we call this funding is exchanged between longs and shorts. The interest rate by and large is determined by the previously observed 8-hour time weighted average premium of the swap vs. The funding rate is published with an 8-hour grace period before it is charged.
That allows traders who do not wish to pay or receive funding to exit their positions before the funding timestamp. The question is, can you predict the future price of Bitcoin by the published funding rate? I have analysed data from March until now. My data series consists of the funding rate every 8 hours, and the log return of the XBTUSD swap over the next 8 hours. The above chart is a XY scatter plot of the data.
The chart clearly illustrates the funding rate contains no significant predictive power. Using an extreme funding rate as the signal, we can take the counter trend position.
To further analyse this hypothesis, I calculated the sample mean and standard deviation of the funding rate in basis points bps. A large negative funding rate predicts a positive return for the next 8 hour period. A large positive funding rate predicts a negative return for the next 8 hour period. If the funding rate is negative, you go long, and you receive funding because the rate is negative.
If the funding rate is positive, you go short, and you receive funding because the rate is positive. The data clearly illustrates that traders may use an extreme funding rate as a signal to take the counter trend position.
A simple trading algo can be constructed to capture this alpha. At each funding timestamp, if the funding rate is above or below your limit, place the counter trend trade. The one caveat is the sample size is still relatively small. I will revisit this study early next year to observe if the results change. However when one engages in critical thought, it appears this ban has more bark than bite.
Examining the way in which the ban was presented to the public, and the actions that were not taken, leads me to believe that this ban is for publicity only. Exchanges must stop supporting any trading of the tokens. Almost immediately most of the Chinese ICO trading platforms shut down. Over the past few days, many exchanges delisted any tokens from their platform.
As you can imagine, without the cannon fodder of retail punters, token prices initially collapsed. Projects that raised money from Chinese nationals must refund them their Bitcoin or Ether. Since in practice, this is impossible to accomplish, the PBOC now has a nice excuse to shut down any exchange it wishes for violating the law.
Token exchange owners must take their butt finessing with a smile on their face. They must bend over again when asked, or the PBOC will find them in violation of a law that is impossible to abide by.
That is the primary reason for these new regulations. The revolutionary aspect of ICOs is that the money raised is in the form of a non-governmentally aligned currency. Usually that is Bitcoin or Ether.
If Chinese punters can still convert RMB into Bitcoin or Ether legally, and withdraw their digital currency from the exchange, they can still subscribe for any ICO they wish.
They are very informed on how money flows into and out of ICOs. Therefore, this was a deliberate omission from the new ICO regulations. The PBOC demonstrated that it cares about the wellbeing of retail investors. The PBOC has prevented investors from losing money in this risky and volatile new asset class. If the PBOC really cared about the financial health of China it would stop propping up the property market by continuing to allow banks to issue credit.
But that will never happen, so another industry was targeted to prove their good intentions. The high priests recognise that a vibrant ICO market in China is valuable.
It helps promote entrepreneurs to create the next wave of useful technological applications that could propel China forward. Every aspect of life in China is affected by this pow-wow. Xi Jinping must present a country that is chugging along towards greatness.
No outward crack in the veneer of harmony and prosperity is allowed. The once vibrant ICO industry in China was a liability. The amounts of money raised grew and grew, and the risk of a high profile project absconding with hundreds of millions of dollars could not be ignored. The last thing Beijing needs before the all-important National Congress is a horde of destitute punters protesting about losing their money in one or more shitcoins.
They claimed that 60 ICOs raised 2. The highly coordinated nature of the announcement and than a prime time television piece about the new regulations is good theatre. Insecure governments will create good theatre in advance of important jamborees. The plebes must feel the love. The crypto market does not respect the PBOC like it once did. To many traders, this ban presented a perfect opportunity to increase their exposure to the asset class. While the PBOC banned ICOs, it did not address the root cause of why Chinese investors are desperate to hand their savings to teams with slick websites.
The property market is still too expensive for most traders, and after the carnage, many traders avoid the A-share market. The PBOC continues to allow domestic banks to expand the money supply through aggressive lending. This unabashed money printing creates a fear amongst comrades of a massive upcoming devaluation of the RMB. Any asset or scheme that can generate inflation beating returns excites desperate Chinese savers.
After experiencing a modicum of freedom over the investment of their savings, Chinese investors will chafe under these new regulations.
The forbidden fruit tastes sweeter. The ICO asset class is still very niche. More people will attempt to purchase this taboo asset. Far from negative, this is one of the best things that could happen to any alternative asset.
ICO fundraising in China will move underground. After a few months, the PBOC relented and allowed trading and withdrawals to function normally again. Savvy offshore trading platforms will profit from the gap in the market caused by the closure of the leading onshore Chinese trading platforms. While overt fundraising through WeChat and QQ groups will cease for now, motivated ICO promoters will create innovative ways to access the insatiable demand for alternative savings products from Chinese investors.
The hard fork came, went, and now we are much better for it. Depending on who you ask, Bitcoin Cash is a roaring success or failure. Traders are neutral beings only concerned with generating profit.
The fear, greed, and widely different policies enacted by exchanges offered juicy arbitrage opportunities. Bitcoin Cash was not the first altcoin to enter existence through a hard fork of Bitcoin. However, it was the first to be widely publicised. Even though SegWit is activated, the scaling debate is not finished. Later this fall, it is extremely likely that Bitcoin will hard fork again.
Therefore, traders should learn about how to make money using derivatives before, during, and after a hard fork. A hard fork of any digital currency is akin to a stock dividend. There is a finite amount of network hash power at any time. Miners will decide which version of a coin to mine based on the price ratio. The difficulty will then adjust to bring the ratio of hash power and price into equilibrium. Price leads difficulty adjustments. If you purchased Bitcoin after the record date, you did not receive BCH.
After the record date, a stock goes ex-dividend. The stock price will drop by the dividend that is paid. If we believe that hard forks act like dividends, then XBT went ex-div on August 1st. Additionally, unlike stock dividends which are a discrete amount of cash, BCH is a tradable currency and its value fluctuates.
Holders of long futures contract do not receive dividends. Therefore a futures contract should trade at a discount relative to the expected dividend payment. They will receive the dividend payment from their long stock position, and if that is greater than the futures discount, they make money. The same phenomenon should occur in the Bitcoin futures markets. The big difference with BCH is that the future price is unknown.
The chart illustrates that traders attempting to create BCH without market risk drove the futures into extreme backwardation. The swap was backwardated, which resulted in shorts paying longs funding. Over this time period shorts paid 3. Remarkably the swap reached an outright 3. The following trades assume you have no view on the viability of BCH.
BCH may or may not be successful, but the trades I will describe yielded predictable positive returns. Predictably interest rates to borrow Bitcoin spiked during this period. Borrowing Bitcoin during the eye of the storm is not advisable. Prudent traders should have credit lines in place well in advance of the event. That allows them to lock in much cheaper rates.
Using the above chart as a guide, putting this trade on hours before the fork yields the best returns. That is when traders are the most irrational.
The best part is that the basis will mean revert quickly, and it did, after the fork. Therefore you limit the amount of time you pay to borrow Bitcoin. Again the best time to put this trade on is hours before the fork. The beauty of funding is that for the rate to go from negative to positive, the swap must go from trading at a discount to a premium.
Therefore you get paid twice. You capture the full discount, plus when you exit, the swap will be at a premium. While the swap basis mean reverts, you also get paid interest every 8 hours for being short.
Once the published rate is positive, you close you long at a premium. After August 1st, it took a subsequent ten funding periods before the rate was positive again. The fork is over. The community breathes a sigh of relieve and hedges must be unwound. Any trader that created their BCH now has it, and must close short derivative positions. The problem is that if Bitcoin rallies alongside the unwind, basis will rise, and hedgers will be forced to cover at much higher premiums.
Therefore it is prudent to go long basis after the record date. Remarkably traders were given an opportunity for days following the fork to buy XBTU17 at a discount. Those that did are test driving Lambos while you ride the bus. During that same time period, the funding went from negative to positive. In total, shorts received 1. The aim of this trade is to play the mean reversion of XBTU17 basis. Hedgers on the margin will choose to short the future to create BCH because the interest rate they pay via the discount pre-fork is fixed.
Therefore XBTU17 basis will go from negative to positive. Bitcoin Cash was a warm up for the main event later this year. Both the big blockers and SegWit disciples believe their cause was vindicated by the recent hard fork. Big blockers point to the non-zero value of BCH as proof the market values their scaling solution. SegWit folks point to the high and rising price of Bitcoin as proof that the market values their scaling solution. This FUD will put a lid on the Bitcoin price. This sets up an exact replica of the Bitcoin Cash hard fork with more money on the line.
The trades and scenarios described above will remain relevant in a few months time. Skip to content Abstract: Figure 1 — Summary chart — Rolling average percentage of empty blocks over 1, block period by pool Source: TOP 3, KB 0. TOP 27 KB 0. Pool policies Different mining pools are said to have different policies. For example figure 8 could be said to demonstrate the following: Up until April Antpool orange produced the highest proportion of empty blocks, at a rate far higher than its peers In April this switched to BTC.
The time gap between blocks Another factor to consider is timing. Chain split token overview Bitfinex chain split tokens — Source: For example SegWit2x resulted in: The BCH distribution had a coefficient of 0. There are essentially four options: Anyone with a negative balance resulting from being a BTC borrower at the time of the fork will need to buy back into BTG within 3 days or risk having the system do it for them Source: The chain split tokens do not consider the impact of the other chain split tokens The above contracts do not fairly reflect each other.
If Bitfinex wants to increase the complexity of the above even further, the following additional distributions could be conducted: What Can Go Wrong If you entered the futures vs. Short Bitcoin spot Profit is earned two ways. Please consider the following simplified example: The credit cycle To some extent, the dynamic described above allows banks to create new loans and expand the level of credit in the economy, almost at will, causing inflation.
The capital cycle Source: Advantages of bank deposits compared to physical notes and coins Factor Bank deposit Physical cash Security Keeping money on deposits in financial institutions, increases security The money is protected by multiple advanced security mechanisms and insured in the unlikely event of theft Large physical cash balances at home could be vulnerable to theft or damage Physical cash cannot be insured and storage costs can be expensive Electronic transfers Using the banking system, it is possible to quickly send money effectively over the internet or by phone, across the world at low cost and at high speed If physical cash is used, then a slow, inefficient, insecure physical transfer must take place Convenience Using a banking system to manage your money, can result in a convenient set of tools.
For example the ability to use money using your mobile phone or on your computer Precise amounts can be sent so there is no issue with receiving change Handling cash is often a difficult and cumbersome process. Precise amounts cannot be specified and one may need to calculate change amounts Auditability Traditional banks offer the ability to track, control and monitor all transactions, which can help prevent fraud.
This improves reporting and accountability With physical cash, effective record keeping is less automated, increasing the probability of fraud.
Transaction fees are zero? Payments work during power outages or when communication networks are unavailable Money can be used without purchasing or owning a device Anyone can use the system, without seeking permission Advantages of electronic systems Payments can be made over the internet Change does not need to be calculated Payments can easily be recorded Funds can easily be secured to prevent theft?
The unique properties of Bitcoin Bitcoin shares many of the advantages of physical cash over electronic bank deposits. The implications of these characteristics on credit expansion Understanding the dynamics of these characteristics, can be useful in evaluating the potential economic significance of Bitcoin, should the ecosystem grow.
Some of Quinn Watson s hedge fund clients in Singapore completely cashed out of their bitcoin holdings because of the activity. ET will forever be remembered as the day when bitcoin hardforked into two separate chains as of block number Bitcoin Block Details Find out what Bitcoin proposals miners are voting for.
Bitstamp to distribute Bitcoin Cash while Coinbase may face a lawsuit. It s very likely that the latest firmware and client will support Bitcoin Cash in very near future.
Multiple users miners developers are clinging to multiple solutions to solve the overarching Bitcoin scaling debate. Some plan to credit their clients, some won t. Fr Bitcoin, internet des transactions et monnaie programmable. We have taken the decision to support Bitcoin Cash, due to the increasing demand from our clients to add support.
Any bitcoin within customers' accounts will remain. We wanted to give our customers an update on the recent Bitcoin hard fork. Est ce une bulle, ou l amorce de quelque chose d autre. The future shines brightly with unrestricted growth permissionless innovation, global adoption decentralized development. According to BCC, a few of the.
When the bitcoin blockchain splits the result will be two sets of tokens: Where do They Stand. Bitcoin cash may be a house of cards that comes crashing down. Locodoco 4 months ago. You can read more about what a digital currency fork is here. I think Armory can t send coins per default on that chain after the split How is transaction replay being handled between the new and the old blockchain.
That they did not trust the currency very much even some suggested that it could come at a price of 0 that they did not want to compromise their clients' money. After the fork Kraken will enable BCH. The idea originally came from deadalnix the ABC client will soon ship this too.
Bitfinex is introducing new Chain Split TokensCSTs that will allow traders to trade on the the potential activation and mining of the Bitcoin Gold consensus protocol.
This is to prevent a different fork that would naturally occur if some people switch to a new client and leave others behind. For contentious forks like this we must remain neutral and let the market decide.