Why Bitcoin Cash will sell off soon! 🔥 💰
Yesterday, I thought that Bitcoin Cash was going to work out, I feel that competition in crypto currencies is a good thing especially with Bitcoin.
Everything was looking pretty good right after the fork. In only a few hours several blocks were mined, they seemed to be getting discovered faster. A number of the exchanges created matching funds for those with Bitcoin on the exchange. Prices looked impressive. If you had BTC on an exchange like Bittrex, they gave you equivalent amount in Bitcoin Cash.
Things are not going that well though just under the surface.
There are some serious problems, and there is now a finite amount of Bitcoin Cash on the exchanges. There is a lot of demand relative to the existing supply; this is creating a false picture.
The prices you are seeing are not reflective of real price discovery. As a result, prices have been soaring as high as $1333 USD on Wednesday. You can think of this as a game of musical chairs. There is some interest in Bitcoin Cash but not very many coins on the exchanges; as a result, you have a finite supply being chased by a large number of speculators. Everyone with Bitcoin Cash outside of the exchanges wants to get involved in this new market. Unfortunately, they can't.
First of all, most of the wallets have not been upgraded to support Bitcoin Cash. Some wallet companies are probably working furiously to make the required changes. There is another problem, however. Bitcoin Cash is having troubles adjusting the mining difficulty. They are still stuck on the old level of mining difficulty that regular Bitcoin is using. It's a mathematical algorithm that takes awhile to adjust.
Today the miners have been only able to mine a block every 200 minutes or roughly every 3.5 hours. Today there was an eight hour period and a 13 hour period where no blocks were mined.
It's difficult to get actual data on hash rates, but I suspect the number of miners has likely gone down today. If you are a miner and you are not finding blocks than the incentive to mine a coin is diminished. It takes six blocks for the mining difficulty to adjust by 20%, so we are likely a couple of days away from having regular sub-30 minute blocks.
You need consistent block times to keep people happy on the exchanges and for wallets to work properly. That's why they have not opened them up for use. Exchanges are going to want several confirmations for deposits, which would take at least half a day with the current slow block times.
Now, what is going to happen when the wallets are finally opened. Well everyone wants to sell or trade their Bitcoin Cash, a majority seem to want to sell. I think people will panic sell. The question is who is going to step in and buy. The price is likely to rapidly go below $100 USD and probably a lot lower.
The volumes that are currently shown on places like CoinMarketCap are just showing the same people trading amongst themselves on the exchanges. There is no real price discovery occurring, volumes are really small compared to the amount of coins in "circulation".
There are very few exchanges planning on accepting Bitcoin Cash, and I expect that there will be some serious demand which will slow down these exchanges. I think there is a high chance that some of these exchanges will grind to a halt.
If you currently hold BTC don't expect to get much for your Bitcoin Cash. If you are fortunate and know what you are doing, you may be able to sell before everyone else. The other option is to just hold for the long term. The high prices are an illusion, and the overall market cap is even more ethereal. Some of you may be able to pick up Bitcoin Cash at the bottom if you time it well.
It seems like this entire forking process could have been handled better. This fiasco will likely dramatically reduce the enthusiasm for Bitcoin Cash; perhaps they can recover over the coming months.
Ryan Herbison is a writer and editor for WeAreChange. He has an extensive background in Internet technology and communications.
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I agree with you. Very informative and argumented article! Thank you for sharing your thoughts
What if, in the long term everyone sells Bitcoin Core and buys Bitcoin Cash? I feel like one chain will survive and the other will be abandoned, and it's too risky to choose a side so I'll just hold both and wait
bitcoin is the original, half its worth is on the dn, dnt see people accepting btcc you kno..
for me Bitcoin still emerged the winner during the fork. We are ready for $5,000 by the end of the year Bitcoin!
I do not see a winner neither do I see bitcoin cash as fake as some may speculate. Bitcoin has not won anything until we have faster transactions and lower transaction fees.
Yes, I agree. The high prices are most likely caused by the fact that most people withdrew from exchanges before the fork. And not those that kept them in are now the only ones trading. Once the wallets upgrade and everyone will rush it to get a piece of the pie, it will most likely drop heavily.
In my opinion that'd be the time to buy for a long term investment, hopefully with BCC slowly, but consistently rising after that.
they are intentionally destroying the crypto currencies because they are rolling out that fed coin federal reserve crypto so they can dominate the market yet again screw the rothschild frb!
So the problem with bitcoin cash is that it hasn't adjusted. The coin was just created. Obviously there will be some issues. I do not see it as very serious issues if it just needs a bit of of adjusting over time. The question is; will it solve the problem bitcoin has been facing?
Totally agree, every new venture has his up and down. It's not time for panic
The failure of b-cash will be a great thing for cryptos.
All hale SegWitcoin!
Definitely worth an upvote and a resteem :)
God I hope your right. Sold it all 24 hours ago. Woke up to like $1200 bch and have been praying for its demise all day. Worst free $700 gift I've ever received 😪 Sorry for y'all that didn't claim yours.
😂😂😂😂😂
Mining difficulty is now down to around 25% of BTC - according to cash.coin.dance.