Bitcoin rival Bitcoin Cash acutely surged on the heels of the SegWit2x scaling drama within the wider Bitcoin community. Once the community realized the Core blockchain wouldn’t get on-chain scaling, many enthusiasts flocked to Cash.
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While both these currencies were dismissed at first by the digital currency community, Bitcoin Cash (BCH) recently saw a huge increase in its price, thus shocking Bitcoin fans throughout the world.
The increase in price from approximately $300 USD per unit to over $1,950 may have happened due to the block size debate for Bitcoin, and the failure to implement SegWit2x despite numerous attempts from its supporters.
To put things better into perspective, the planned hard fork, known as SegWit2x, was called off for objective reasons several days ago. This has allowed the community to avoid disruptions on digital currency exchanges alongside with potential fund losses.
A Rush to Bitcoin Cash
However, the SegWit2x protocol had avid supporters who really wanted to see it live. It is believed that once the hard fork was pulled off, many decided to invest their money into BCH, as it offers a couple of protocol changes when compared to the traditional Bitcoin Core.
This initially drove the prices up to roughly $600 per unit of Bitcoin Cash. Analysts believe that further speculation fuelled the bearish rally, thus increasing prices even more. It is important to point out the fact that this was happening while Bitcoin was losing in terms of its value.
In fact, a one point traders were able to buy Bitcoin at $5500 – whereas BCH basically increased with exactly the amount lost by Bitcoin.
On the 17th of November 2017, the supporters behind SegWit2x attempted to initiate another hard fork. As expected, due to a lack of supporters and no general consensus, this attempt also failed. Now, it is expected that the price will settle for a while, thus reducing chances of future volatility like this.
For those who do not know, the main plan of SegWit2x was to increase the Bitcoin block size from 1 MB to 2 MB in order to accommodate a larger number of transactions within the same block. This comes both with benefits but also with disadvantages.
The initial surge in price of BCH allowed it to overtake Ethereum in terms of market capitalization, thus reaching the 2nd place for the first time.
At the time of writing, Ethereum has recovered its place as the 2nd biggest digital currency by market capitalization.
Images via Spencer Platt//Getty Images, Bitcoin Cash
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