After meandering around $300 for the last two weeks, Bitcoin Cash has rocketed higher in the last few days – now trading at record highs over $900. As Bitcoin Cash has surged, Bitcoin has been falling (now back below $4000) as Bitcoin Cash mining profitability becomes more appealing to miners.
Bitcoin Cash has surged to a new record high in the last few days, now triple the market cap of Ripple and over half the market cap of Ethereum…
And Bitcoin has been sliding…
So just what is going on with BCH? Coinivore explains… As blocks continue to process, BCH edges its way closer to the legacy Bitcoin’s network mining profitability.
It’s what could be known as the “flippening,” and block 479808 is the block to watch if it’s going to happen (this weekend), Coindesk reported.
Block 479,808 (set for this weekend) will likely trigger a difficulty adjustment downwards 50%, and if the prices of bitcoin and bitcoin cash stay the same, this means miners will make almost double on bitcoin cash what they would on bitcoin.
As BCH mining profitability becomes more appealing to miners, the chance of other mining pools using hash power for BCH is greater, especially if the new kid on block Bitcoin Cash’s markets continue to rise.
Now, why would miners abandon the legacy Bitcoin? Because BCH chain’s difficulty has also dropped, and at the same time the price has risen over 75% in the last two days. As such, Bitcoin cash mining (BCH) is now currently 2% percent more profitable to mine than the legacy Bitcoin (BTC).
Another reason is the legacy Bitcoin blockchain charges higher fees on transactions, so miners must take into account the extra 1.5 BTC per block on Bitcoin (about $6,000 USD) while Bitcoin Cash offers very low fees under $50 USD.
All around BCH just seems like the more attractive opportunity for miners.
— Roger Ver (@rogerkver) August 18, 2017
Additionally, Coindesk notes that new exchange volume is also helping drive BCH higher…
While both bitcoin and bitcoin cash share a transaction history, there’s at least one major differential that changes their markets – bitcoin cash didn’t inherent bitcoin’s expansive global exchange network.
This means while bitcoin is widely available for trading across continents, only a few major players stepped up early to add Bitcoin Cash.
Still, signs suggest more exchanges could soon see a value in doing so. Case in point, the trade volume in bitcoin cash observed during the recent run was largely denominated in the South Korean won today.
Yesterday, about $1.2 billion of the $2 billion in total bitcoin cash trade volume, or around 56%, appeared to be transacted in won on just three South Korean exchanges – Bithumb, Coinone and Korbit – according to data from CoinMarketCap.
Such a strong regional showing could indicate pent up demand – but whether it’s from sellers seeking to sell, or buyers looking to buy, that remains unclear.
Prior to the increase, though, bitcoin cash trading volume was relatively light earlier this week, and it increased roughly tenfold today.
Finally, we note that Faster processing times may be appealing, as CNBC reports that Bitcoin Cash faster processing is what likely caused 40 percent of investors increasing their bet on it.