In a recent announcement by Coinbase, it was revealed that they have intentions of support the withdrawal of bitcoin forks from their exchange in the future.
This has caused some uproar in the cryptocurrency community because many see forks of coins like Bitcoin and Litecoin as scams that try to impersonate the original cryptocurrency. On the other hand, fans of the forked coins are thrilled to see this decision by Coinbase.
Coinbase has been getting quite some competition from other cryptocurrency exchanges in the latest months, especially with the announcement of Binance creating a fiat to crypto exchange based in Malta. Since then, Coinbase has been announcing a bunch of features to increase the experience for its users, and this is another one.
When a fork occurs, individuals with funds on the forked blockchain will be rewarded the new cryptocurrency based on the ratio between the forked coin and the original, and the amount they held when the fork happened.
Extracting a forked coin from one’s private key is no easy task and not always secure either. You could end up losing your funds because the process requires you to insert your private key into a third-party application. You can be safe by moving your funds to a new wallet before using the private key to unlock the forked coin, but it is then recommended to not use the wallet which private key was exposed anymore.
A service like what Coinbase is creating will help many users as they will be able to securely withdraw forked coins which Coinbase decides to support directly from their dashboard without the fear of anything being lost or hacked.