There is a cryptocurrency war brewing in Bitcoin land. On Tuesday, Bitcoin forked, leaving us with the original Bitcoin (BTC) and Bitcoin Cash (BCH). During its first week of trading, Bitcoin Cash has been on a wild rollercoaster ride when it comes its valuation.
On Wednesday, just one day after its trading debut, Bitcoin Cash was riding high with a price of $756 (at its intra-day high). However, the past few days have seen Bitcoin Cash tumble, falling to just $289 today in afternoon trading. This is hovering near an all-time low for the cryptocurrency.
Bitcoin Cash has also been rocked by the fact that while it has the same mining difficulty of Bitcoin, it has a fraction of the hash power resulting in painfully long block times. In addition, exchanges like Bitfinex and Bittrex have opened for business with regards to BCH deposits, which has forced prices down.
The split between BTC and BCH occurred due to a brewing battle over how to best to scale the cryptocurrency as its popularity has increased and delved more into mainstream markets. "When a change is proposed to a digital currency protocol, users need to show their support for the new version and upgrade — in a similar way to people regularly update applications on their computer,” said David Farmer, director of communications for digital wallet Coinbase late last month. “In order for these changes to get approved many people need to agree, just as changes to cellphone networks require many phone companies to agree."
Needless to say, an agreement between all parties involved could not be reached, hence this week’s hard fork. The hard fork has had little effect on the Bitcoin. When the fork took place, BTC was at roughly $2,750. Today, BTC is inching closer to its record highs at $2,848.