Fallout from the Segwit2x cancellation briefly inflates Bitcoin Cash prices.
Bitcoin is slowly recovering from a turbulent weekend which saw almost $US2,000 wiped off the value of the cryptocurrency, largely due to fallout from the scrapped Segwit2x proposals.
The cryptocurrency began a slow decline following the announcement that the Segwit2x fork, which proposed new rules for Bitcoin’s blockchain, would be called off, resulting in a gradual decline from over $US7,700 on Wednesday evening, to $US6,400 on Saturday.
Bitcoin’s performance over the weekend – courtesy of Coindesk
By Sunday morning, Bitcoin sat at just over $US5,600, the lowest it’s been since late October when it experienced a sudden surge in value. Since then the currency has seen wild price fluctuations of as much as $US1,000 over the course of 24 hours.
At the time of writing Bitcoin has been able to recover to $US6,400, still more than $US1,000 off the all-time high achieved earlier this month.
Businesses and miners decided last week to call off the Segwit2x fork, which would have seen Bitcoin’s block size increase in order to improve transaction speeds on the network. The news was welcomed by developers who felt the fork would’ve placed too much power in the hands of miners and large businesses.
However, it’s now thought that those who supported the change have since migrated to other blockchains that are more accommodating to their ideas, according to sources speaking to Coindesk, including Bitcoin Cash, created earlier this year as a fork from the Bitcoin blockchain.
Bitcoin Cash has already benefited from this sudden exodus of miners, and hit an all-time high of $US1,953 on Sunday, ballooning to over $US2,000 over the course of three days. The surge was so dramatic that Bitcoin Cash was for a brief time valued at more than $US30 billion, actually exceeding Ethereum to the second highest market cap position.
It’s unclear what this shift will mean for future trading, and the price peaks and troughs have already started to level out once again. Bitcoin is steadily growing in value once more, while Bitcoin Cash has fallen back down to $US1,200 at the time of writing.
However, it’s important to note that this isn’t simply a case of investors taking their money out of Bitcoin. Instead, miners are moving their computing power away from the currency’s blockchain, and essentially making it easier to mine Bitcoin Cash.