Has Bitcoin finally bitten the dust now that it has crypto newborns?
Crypto currency is no longer in the conversation of its potential competition with cash. It is now evolving at an alarming rate and splitting offshoots, in which a bitcoin in one system is competing with another crypto coin newborn in another.
But this is creating volatility problems and helping shake the crypto financial world at its core.
CNBC said that there were questions about whether the digital currency “can be a sustainable investment asset.”
A loud boom and crash
Bitcoin dipped 15 per cent from nearly $6,500 (it recently crossed $7,800 on November 8, 2017) to a low of $5,507, but shot back to $6,400, according to CoinDesk, an industry online platform.
A strong appetite for investment by large investor groups has contributed to the Bitcoin’s growing 7 times its original size at the beginning of the year.
The earth also shook, when a previous Bitcoin fork in the crypto world, called Bitcoin Cash, which saw the light last August amid total disregard by industry analysts who believed that the cloned crypto offspring would not succeed, skyrocketed in value to $2,500, after stalling at $300 for a long time. Then it crashed by 50 per cent within 24 hours, according to CoinMarketCap.
With this happening, can the market handle another new born crypto?
A gold mining opportunity
According to CNBC, the trading volume in Bitcoin Cash over the last 24 hours was around $7.9bn, versus $8.6bn for the original Bitcoin, quoting CoinMarketCap.
“Adding to the debate over Bitcoin’s future, another offshoot called ‘Bitcoin Gold’ was set to launch Sunday. Bitcoin Gold seeks to make the process of ‘mining,’ or generating bitcoins, less dependent on the few who have access to specialized technology,” said CNBC.
The offshoot was not exempt from the latest volatility. Futures for Bitcoin Gold plunged more than 40 per cent from just over $500 Saturday to below $300 Sunday, according to CoinMarketCap.
Developers of the project aim at blocking the use of specialized chips for mining.
Bitcoin Gold is distributed to anyone who owned Bitcoin at the time of the split.
According to CoinDesk, an industry platform, the process of distributing the new software had some users facing issues while connecting their nodes to other computers on the network. They found weak links in the blockchain.
Others allege they were receiving spam messages containing links to fake (and potentially malevolent) software clients,” said CoinDesk.
“Currently, Bitcoin Gold (BTG) futures are trading between roughly $260 and $290, according to CoinMarketCap – a decline of over 30 per cent (in the past 48 hours), it said.
Bitcoin vs Bitcoin Cash
Roger Ver, one of the biggest holders of Bitcoin historically, recently told Forbes that he was selling his Bitcoin for Bitcoin Cash.
“Bitcoin Cash is useful in commerce, and therefore can also be used as a store of value,” he wrote.
Forbes said that he was indirectly referring to the high transaction fees on Bitcoin and that Bitcoin Cash had much lower fees.
“Part of the debate around the potential hard fork was around the vision for Bitcoin: whether it should be a store of value only, like digital gold, or a store of value as well as a means of exchange, like digital cash,” it said.
Bitcoin Cash has a few other things going for it – namely the fact that it is now 2.2 times as profitable for miners who can secure blockchains to mine Bitcoin Cash than to mine Bitcoin, wrote Forbes.
“That means the Bitcoin blockchain has lost so-called hash power, which will mean it will take longer for transactions to be processed.”