BCH-USDT price chart on bittrex today
Yesterday was a frightening day for people that follow the price of the main cryptocurrencies. Bitcoin price fell 15%, while it's latest adversary Bcash (BCH) saw its price fly more than 100% in two days to a top of around 4000 USD in most exchanges, and even higher in Coinbase! What was the reason of this and what should we expect for the next days? I will try to expain what I gathered from the people and articles I follow for this day that left me frightened and angry.
The Bcash pump
For those who don't know, Bcash or Bitcoin Cash is a fork of the Bitcoin network made by a group called BitcoinABC and backed by Jihan Wu, Roger Ver, the crew of Bitcoin Unlimited and many other well known Bitcoin big blocks advocates. The software is a fork of the Bitcoin core sotware, but with almost all the Segwit related upgrades removed, and with a max block size of 8 mB. It is the big blockers coin. It has been made due to some people not liking the current path that the Bitcoin core group had envisioned for BTC, and wanting to make their own consensus rules between a smaller set of bitcoin users who wanted to implement big blocks and hard forks in their coin. If this was the only thing they wanted to, I think that their position would have been quite noble, but with the events that happened following the split, it is quite obvious that they wanted more than just their space in the coinmarketcap list of coins, they want to be the real Bitcoin.
Is it bitcoin cash or is it Bcash?
It all starts with the name and the address space. Bcash kept both things identical to Bitcoin. They use bitcoin in their name, which has caused much confusion among users of Ver site bitcoin.com, and they kept the address format the same, another thing that made lots of people lose money when they sent their coins of one chain to the address of another chain, which can be saved only by people who have the privkeys of that address, if there is any. Besides that, any attempt from Bitcoin users and businesses to use a slightly different naming convention to the coin, i.e. Bcash, has been met with angry responses by some of its advocates, for example Roger Ver and Jihan Wu, granted that Roger showed the finger in the end for being accused of paying sockpuppets on twitter. They want you to believe that their pet coin is the real bitcoin, as Roger has stated numerous times. Their arguments are simplistic and fallacious, usually holding on weak deffinitions of what is cash, and their shills are very active on twitter, but equally devoided of substance.
Once again, if it was all they did, this would both be inneffective and silly, but they went several steps ahead. Their coin has what is called a DAA, difficulty adjustment algorythm, another difference from the refference core client that makes ther coin easier to mine if it hasn't been mined for some time. The result is that it constantly incentivizes the miners of BTC to jump and mine BCH, that has the same mining algo, which in turn makes the Bitcoin network slower and fees higher, while making blocks in the Bcash network be found in seconds, inflating the coin quickly. This itself can already be seen as an attack on the bitcoin network, but they do more. Roger is believed to possess hundreds of thousands of Bitcoins, and as such he could as well sell his Bitcoin for Bcash, causing a pump in BCH and a dump in BTC. These pump and dump cicles have strangely coincide with the DAA that makes miners mine BCH, and to add things to the problem, small 5sat/b trasactions usually flood the Bitcoin network when all these things happen. All these things together sugest only one thing, that Bcash supporters are actively attacking the Bitcoin network anyway they can, and yesterday Coinbase's fiasco was another strike on the BTC network.
Coinbase was set to release their clients locked Bcash next year's january, but for some odd reason they released it for buying yesterday without any major previous warning. People paniced and bought the coin like crazy. This made the price of the coin go up so high, that it was 2x bigger than in other exchanges top, around 8000 USD. This was done in the middle of a difficulty adjustment on the BTC network, which made it more difficult to mine. If miners jump to Bcash to mine it for profit, Bitcoin will get slower and more expensive. Add to that the fact that bitcoin has never seen as much demand as it has been seeing now with the futures market, and we're bond for a clogged network for days ahead and a price fall that might scare a lot of investors. Bcash seem to have planed all of this, including a sudden interview with CNBC with Roger Ver about Bcash in the same day. This was a deliberated action to attack the Bitcoin network and pump Bcash as much as they can, but what will be of it?
As you can see in the chart, Bcash price has started correcting, and already lost 25% of the supposed value it got from the pump, a dump has started. It was expected, since all the user that had their Bcash locked in Coinbase fro months can now sell it all for Bitcoin and Altcoins for a premium. The selling number will bring Bcash price down, near where it was a week ago, marking another pump and dump in the coin's short history. Many people who felt the fear of missing out (FOMO) and bought it near the top will lose hundreds it not thousands of dollars in this new dump, which together with the accusations of conspiracy and insider trading, is going to stain both the brand of Coinbase and Bcash for the near future. Bitcoin price is falling right now, in 15000 USD, but it is still 100% higher than it was in november, and with news of ETF and other products coming to the network, we might expect a good month of january ahead. The leasson of yesterday dump was don't panic, these attacks will get more frequent and more sophisticated, and All they want is to separate you from your coins. Don't give it to them, hold your coins safely and in projects you believe, and in the future ethics and open development will win against colusion, conspiracy and centralization.