The competition between Bitcoin and Bitcoin Cash is a hot topic in the crypto-world. Whose side are you on? Will Bitcoin Cash catch up with Bitcoin? Most people are convinced they cannot coexist in the long run, but which one survives is a mystery. Opinions are based on feelings, rather than on facts. Believers of the original Bitcoin love to point out the ‘immortality’ of the coin, while investors in Bitcoin Cash praise the lack of scalability issues and low fees.
Weekend action
The ongoing fight between Bitcoin (BTC) and Bitcoin Cash (BCH) has been affecting the market for some time now. As a result, non-Bitcoin markets have seen little action the past weeks. Coins like Ethereum, NEO, LiteCoin, and Ripple have been moving between support and resistance. On the other hand, the duel between BTC and BCH came to a peak last weekend. BCH overtook BTC in terms of hash rate, which led to serious backlogging problems and high transaction costs: BTC had over 100,000 unconfirmed transactions and fees went up to about $10. At the same time, BCH skyrocketed to $2500 and even passed the important barrier of 0.5 BTC on some exchanges.
No Segwit2x
The weekend action was the result of the cancellation of the highly anticipated Segwit2x implementation, which was due end November. Last Wednesday, however, the Segwit2x hard fork was called off due to lack of consensus. The implementation of Segwit2x had to increase the block size to 2 MB (currently 1 MB) and was part of a scaling plan recorded in the New York Agreement. As investors anticipated the upcoming implementation the price of Bitcoin rose from about $4000 to almost $8000 in less than two months. Following the cancellation, the price of Bitcoin dropped about $1000, which was not that much, if you ask me. Nevertheless, it was a win for BCH. The competitor does not have scaling issues – the block sizes are 8 MB – and the fees are much lower. In the run-up of Segwit2x the price already tripled from $300 to $900 (Did people use it as a hedge against BTC?) and after the cancellation another pump.
Conspiracy
There have been some conspiracy theories that it was the plan all along to replace Bitcoin with Bitcoin Cash. First, they waited till the price of BCH bottomed, such that buying in would be cheaper. It was never the plan to implement Segwit2x, but the conspirators used it to pump BTC before they would dump it. Some say that the plan was real, but the power of the parties involved in the conspiracy made sure, it would not go through anyway. It is said that some big Chinese parties – with a lot of hashing power – are involved and they are trying to invert the hashing rate in favor of Bitcoin Cash and provoke a massive sale.
Correct me if I’m wrong, but BCH does not need more hashing power than BTC due to larger blocks and less transactions. However, BTC has a big problem if the hash rate turns in favor of BCH as has been shown last weekend. If their plan succeeds and Bitcoin Core fails to tackle the scaling problem soon, we probably have the ingredients for The Flippening. You can read more here. It is certainly an interesting story, but we cannot verify whether it is true.
Bitcoin Cash corrects, Bitcoin survives
Whether it was an attack, widespread FOMO or a combination of both, the market calmed down in a few hours. BCH dropped back to around $1700, while BTC soon cruised above $6000 again. Also, the hash rates recovered: BTC doubled from 5000 to 10000 PH/s, while BCH crashed from 7500 to 1250 PH/s. So far, Bitcoin convincingly overcame the threats it faced, but last weekend also showed how vulnerable the current situation is. BCH is a true competitor and is – in my opinion – the better coin, but BTC has one enormous advantage: crowd support. Face it, almost everyone, who does not live under a rock, knows Bitcoin, but Bitcoin Cash and even Ethereum are still coins for people who are already familiar with cryptocurrencies. Every time the backlogging issues of Bitcoin come to the surface, more and more people will consider leaving Bitcoin and then Bitcoin Cash is probably the best alternative.
Conclusion
It is not a bold claim to state that the fight between BTC and BCH is far from over. Even though the prices corrected quite fast, it has done more damage than good to Bitcoin, while Bitcoin Cash investors are encouraged in their belief that their coin can take over the throne. Suppose The Flippening really happens, can Bitcoin reclaim the throne? I think it will be a lot harder for Bitcoin to keep the pressure on Bitcoin Cash given the fact that the hash rate will be low, which in turn causes high fees and transaction piling up, unless – of course – Bitcoin Core does come up with a solution.
Personally, I have no strong preference, but I have to admit that I’m more interested in BCH than in BTC right now. Also the conspiracy sounds reasonable to me, but maybe I’m not critical enough. Let’s state it differently: if I could invest in either BTC or BCH, I would convincingly choose the latter.
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The Flippening: Bitcoin versus Bitcoin Cash | Ecency
