What a vibrant time to be a part of the crypto universe! Bitcoin Cash (BCH), one of the prominent cryptocurrencies, is lighting up the charts with a splendid performance. Over the past three days, BCH has skyrocketed by a thrilling 36.5%.
The most recent 24-hour stats show BCH bouncing over 10%, reaching a praiseworthy $143 – a value unseen since February, as per CoinDesk’s data. Complementing the price surge, BCH has seen a remarkable 77% upswing in open interest (a significant gauge for the nominal value of open trades on a particular asset), touching a nine-month zenith of $135 million, according to Gate.io crypto exchange data.
Such an upturn in open interest is pointing towards a tidal wave of positive sentiment sweeping the market, encouraging hopes that BCH might be at the precipice of a broader institutional acceptance, especially post its current listing history.
Born in July 2017 as a hard fork of the original Bitcoin, Bitcoin Cash blasted to an all-time high of $2,947 amid the buzzing 2017 bull market. However, despite an initially promising run, BCH’s adoption as a payments network has somewhat taken a backseat compared to its original counterpart.
But let’s get some perspective. Over the past week, Bitcoin Cash’s network facilitated transactions worth more than $100,000, amounting to a substantial $129 million. Now, compare this to Bitcoin, which accommodated $75 billion worth of transactions during the same timeframe.
Speaking of market sentiment, crypto services provider Matrixport’s Bitcoin Greed & Fear Index (GFI) has soared from under 10% to an exciting 93% in merely a week. This significant shift reflects an overriding market emotion teetering towards greed or excess optimism.
Now, let’s not forget the headline-maker – Bitcoin, which soared past the $31k mark for the first time since April, post BlackRock’s application for a spot Bitcoin ETF. However, it’s our star player, Bitcoin Cash, which has stolen the limelight by outperforming the market to a higher degree, as BCH price went up by 34% since June 15th.
Diving into the BCH’s specifics, it’s essentially a product of the block size wars that occurred during the 2017 crypto bull run. BCH aimed to facilitate faster and cheaper transactions compared to the original Bitcoin network. Despite some initial hurdles, BCH remains widely accessible across all major exchanges. Nevertheless, the fundamental question of wider adoption still lingers.
To understand BCH’s position better, let’s consider the reality. The BCH community witnessed its share of internal disagreements, leading to another fork and the birth of Bitcoin Satoshi’s Vision (BSV-USD), further fragmenting the ‘big blockers’. Moreover, the rise of alternatives like Litecoin, the Lightning Network, and smart contract chains like Solana (SOL-USD) or Algorand (ALGO-USD) offers stiff competition.
In summary, although BCH hasn’t experienced the adoption rates initially expected, its recent performance in the market is nothing short of remarkable. While it may not overthrow BTC’s dominance as a peer-to-peer payment instrument anytime soon, it certainly offers an exciting avenue for speculation amidst a wider crypto rally. From a user’s perspective, BCH continues to stand tall as a solid blockchain network.
Both these cryptocurrencies may have sprung from the same source, but they are, in many ways, as different as apples and oranges.
Bitcoin (BTC), the original cryptocurrency, was created to function as a decentralized digital currency facilitating peer-to-peer transactions without the need for an intermediary. It is often perceived as ‘digital gold’, a value store which can be saved, retrieved, and exchanged at a later time, and the value of which does not degrade over time.
On the other hand, Bitcoin Cash (BCH) emerged in 2017 as a hard fork of Bitcoin, aimed at addressing what some perceived as Bitcoin’s scalability problem. The main differentiating factor is that BCH increased the block size from Bitcoin’s 1MB to 8MB initially, and subsequently up to 32MB, with an intention to accelerate the verification process, lower fees, and make the blockchain capable of handling more transactions. Hence, BCH was created with an intent to serve as a medium of exchange, facilitating everyday transactions, rather than a mere store of value.
While both of them continue to hold their ground in the crypto world, their intended use cases, transaction speed, fees, and community support have largely influenced their market positions and perceived value. Therefore, even though they share a common genesis, BTC and BCH cater to different segments of the crypto market.
When Bitcoin Cash underwent a hard fork from the original Bitcoin (BTC) blockchain it followed the principal of “fork fairness.” This means that anyone who held Bitcoin at the time of the fork was entitled to an equivalent amount of Bitcoin Cash in their wallet.
This process of distribution is based on the snapshot of the Bitcoin blockchain at the time of the fork. Each Bitcoin transaction has an associated set of inputs and outputs, linking it back to the chain of transactions that led to the current state. So, when the fork occurred, the Bitcoin Cash blockchain mirrored the transaction history of the Bitcoin blockchain up until the point of divergence.
Essentially, every Bitcoin holder received a ‘free’ allocation of Bitcoin Cash. If someone had, for example, 2 BTC at the time of the fork, they would automatically have 2 BCH in their wallet. It’s like a dividend payout to shareholders, but in this case, to cryptocurrency holders. This process of automatic distribution further solidified the decentralized nature of cryptocurrencies, ensuring that the power remained evenly distributed among users, rather than being concentrated in the hands of a select few.
In general, Bitcoin Cash seems to hold a strong position at the price level it is currently at. The BCH price prediction engines predict it a constant rise, claiming that it should reach high $400-$500 range by 2031. Although this may not sound as an explosive asset performance, it is key to note that all tokens in the crypto world move together and a new bull run can take BCH back to where it started from in a matter of weeks.
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