It is quite common in history to see innovations topple pioneer companies that have started an entire industry. Will this be the case for Bitcoin Cash and Bitcoin? Bitcoin cash was originally based on the original Bitcoin. But unlike Bitcoin, Bitcoin Cash allows more transactions to be processed.
There is no debate to how much Bitcoin’s value and popularity skyrocketed in 2017. It even breached the $20,000 limit. However, trailing behind is Bitcoin Cash. Though it is still not yet as expensive as Bitcoin, Bitcoin Cash surged by more than 50% and has reached $3,000. On the other hand, Bitcoin fell to more than 5%.
Problems with Bitcoin
Chris Keshian, co-founder of Apex Token Fund mentioned that “Bitcoin’s slow transaction times and high fees make it untenable as a daily currency”. But the reality is a bit more complicated than this.
There are a number of problems that people experience with the Bitcoin network. For one, you have to deal with the slow transaction times. It takes more than four hours in order to finalize your transactions. In addition to this, you also have to deal with high fees. And because of this, there are experts that are quite anxious regarding the future of Bitcoin.
There are those that have flocked towards Bitcoin Cash. What it offers is a much faster transaction. A lot of experts are also concerned by the amount of computation power that has to be committed by Bitcoin miners.
Death Spiral Scenario?
One problem with Bitcoin is that adjustment on its difficulty happens every 2,016 blocks or about two weeks. This only means that if the hash rate drops, it is possible that the difficulty would be considered too high for the processing power on the Bitcoin network. This could only mean delays when it comes to Bitcoin transactions. In effect, this could be a reason why investors would start dumping Bitcoin and make a switch towards other altcoins.
In addition to this, it could spiral into other problems as well. For instance, lower Bitcoin price could mean less profitability on the part of the miners. And therefore, there is also a chance that they switch to other coins that are easier to mine. This cycle is called the death-spiral scenario by some experts.
ETH and BCH Doing Good
As Bitcoin depreciated in value, both Ethereum and Bitcoin cash are having a good day. In the last 24 hours, these altcoins have gained 16.6% and 26.6% respectively.
Experts are thinking that there is a huge possibility that money is already flowing out of Bitcoin and into other cryptocurrencies. There is a strong rally behind Bitcoin cash recently after a good number of exchanges have offered BCH/BTC pair.
Bitcoin cash is also now in Coinbase. This is big news for those who are using Coinbase since they can already buy, sell, send, and receive Bitcoin Cash using the platform.
So what could be the future of Bitcoin? Will its value continue to plummet? The bearish trend is believed to be temporary. There is a chance that it could return to $20,000 back in the next five days.