Bitcoin Drops below $6000 as Bitcoin Cash Surges

Andrew Cummings
November 12, 2017

Bitcoin is down 7.5 percent, Ethereum is lower by a tad over 8 and Litecoin has shed over 9 percent of its value. At press time, BTC/USD exchange rate is trading at $6788.28, which demonstrates the drop of 5.68%, according to CoinMarketCap.

The fork that had been planned for next week, known as "SegWit2x", had also meant to increase the capacity of the blocks, and could thus have reduced fees for bitcoin transactions. In 24 hours, the trading volume for Bitcoin Cash surpassed $11 billion.

Segwit2x aimed to speed up transactions on the bitcoin network by increasing the size of "blocks" - files that store information on the network - from one megabyte to two megabytes (hence, the 2x). The hard fork could have succeed if most participants agreed on the proposal, but instead of that, the company faced with the lack of consensus putting the whole network under the risk of splitting.

The result of the first hard fork of Bitcoin, Bitcoin Cash is obliterating any competition in cryptocurrency markets today.

Exchanging Bitcoin Cash was also hard due to the high load on exchanges and the increased demand. Now, investors seem to invigorate interest towards Bitcoin Cash (BCH). However, it is important to acknowledge that miners always follow the more profitable blockchain, as they are rewarded with higher returns for producing blocks of transactions.

"The delay to Segwit2x has damaged confidence amongst bitcoin investors concerning the much-needed resolution to speed up bitcoin's slow processing speed".

It is worth noting that the recent rally was supported by altcoin sell-off as traders exchanged them with Bitcoin, hoping for "free coins" after the hardfork. But there is no weight yet behind Bitcoin Cash: virtually no users or businesses, nothing outside of hash power & pumped price.

The announcement to shelve the upgrade, however, drew disappointment from investors who had expected that the SegWit2x upgrade would have led to the creation of a new cryptocurrency that would have distributed to current holders of bitcoin.

The price of Bitcoin has suffered as a result. The analysts say that both options are possible, it still remains to be seen.

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