On August 1, the digital currency Bitcoin divide into two derivative currencies, Bitcoin Classic (BTC) and also Bitcoin Cash (BCH). After bitcoin cash hard fork the value of btc has just crosses $4000.
Since the value of a bitcoin was so low at the moment, trading for pennies per day, the limit was meant to stop prospective attackers from overloading the network using a flood of cheap trades.
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This one simple variable gradually led to the emergence of two competing factions within the Bitcoin business. One side wanted the limit increased to allow Bitcoin to scale with increasing demand, while the other side maintained that allowing Bitcoin to rise too quickly would result in its centralization and change to corporate management.
As the Bitcoin system grew in popularity, this 1 megabyte limitation started being pushed up against in late 2016, but through natural network growth rather than by a flood of maliciously generated trades. The result was that Bitcoin found itself not able to absorb increased demand: Each transaction would now be at the cost of another, and also a fee bidding war drove the average transaction fee from pennies to a summit of more than $5 in June 2017.
Bitcoin Cash Hard Fork
Many worried that such high prices would hinder Bitcoin’s rising adoption and usage, disenfranchising most of the world’s real Bitcoin consumers, leaving only price speculators and people willing to pay large prices to transact in bitcoin.
After years spent at loggerheads with another faction, the Bitcoin Cash supporters decided that rather than try to morph Bitcoin for their fantasies, they would simply create a split of the ledger and let the market decide. The Bitcoin Classic chain retains the 1 megabyte limit and also the legacy ticker symbol, BTC, while the Bitcoin Cash series has increased the limit to eight megabytes and adopted a new ticker symbol, BCH (alternatively BCC, depending on who you ask).
Any person holding bitcoin in the time of the split on August 1 received equal quantities of every new coin at the right time of this split. In the event that you had one Bitcoin in the end of July, you would currently have one BTC and yet another BCH at August. Instead of causing a market upset, the split achieved the desired outcome of allowing both visions of Bitcoin to compete in the free market.
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Several have opted to sell 1 side of this split to purchase more of the other side, but more conservative holders can benefit from holding both and refraining from speculation. Preventing both of the two ideologically divided camps from pursuing their eyesight does no one any favors: Both camps were stuck using a variant of Bitcoin they viewed as suboptimal. The split makes it possible for each coin to develop and expand from the way its supporters believe to be greatest.
Along with the markets appear to agree. The purchase price of the two tokens combined is now greater than the price of a single Bitcoin prior to the split. In the long run, expect to see market demand coalesce around one of those 2 coins. Bitcoin has ever jumped to the free market–will be the very best coin win!
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