The value of a single bitcoin has shot up to a whopping £7,000 after the so-called “hard fork” didn’t go ahead.
And the upgrade would have changed bitcoin’s rules in a “fork”, effectively cloning the existing bitcoin to create another cryptocurrency.
Developers argued this was necessary to keep up with the pace of growth and allow more transactions through the network.
It would have allowed people with less powerful computers to mine the currency and decentralise the network.
But many were against the change, and it proposals fuelled acrimony in the Bitcoin world over the last few months.
A statement, signed by several high-profile bitcoin entrepreneurs and developers, said the “Segwit2x” upgrade would be scrapped for now as it could “divide the community”
And the plans to implement the changes were suspended last night.
The statement said: “Let’s now work together towards scaling safely. We may need something like a 2x hardfork in the future, but let’s do it when there’s consensus and not rushed.”
The lead developer on the team planning to hard fork, Alistair Milne, manager of the Altana Digital Currency Fund, said: “Our goal has always been a smooth upgrade for Bitcoin. Although we strongly believe in the need for a larger blocksize, there is something we believe is even more important: keeping the community together.
“Unfortunately, it is clear that we have not built sufficient consensus for a clean blocksize upgrade at this time. Continuing on the current path could divide the community and be a setback to Bitcoin’s growth. This was never the goal of Segwit2x. … We are suspending our plans for the upcoming 2MB upgrade.”
“The 2x fork is dead. Long live bitcoin.”
Litecoin creator Charlie Lee tweeted: “Segwit2x hardfork has been called off! Common sense prevails.”
The price of bitcoin sky rocketed on the news.
Bitcoins are systematically produced from something called the “blockchain”.
Often called “mining”, tech whizzes use highly advanced technology to create new coins.
However, bitcoins can’t be created forever – the blockchain was devised so that only 21 million Bitcoins can ever be produced.
This makes btcoins a finite resource and so, logically, their price can only ever go up as demand increases.