Bitcoin tumbles as alternative bitcoin cash soars to record high
11 Nov 2017
Bitcoin fell on Friday to its lowest since 1 November as traders bet on its offshoot, bitcoin cash, instead.
The offshoot digital currency surged more than 40 per cent to its highest since 19 August, and was last trading near $947, according to CoinMarketCap.
Bitcoin cash split off from the original version of bitcoin in August as a minority group of developers decided to implement an upgrade in an effort to increase transaction speeds for the digital currency.
An alternative bitcoin upgrade proposal, SegWit2x, which initially had more developers behind it, was called off Wednesday due to waning support.
Bitcoin cash has more than doubled since the upgrade to the underlying technology was called off. Bitcoin is down about 10 per cent during the same period.
Bitcoin hit a record high of $7,879.06 that day after the news of the demise of SegWit2x, but quickly fell and was trading 9 per cent lower on the day Friday afternoon near $6,500, according to CoinDesk.
Bitcoin cash is gaining as traders who were disappointed with the suspension of the so-called hard fork, or split, may view it as an alternative. Both Bitcoin cash and SegWit2x have larger block size than bitcoin.
Roger Ver, the man known as Bitcoin Jesus, says bitcoin will have to allow for larger block size to speed up transactions and reduce fees, and called the cancellation more reason than ever to be bullish on what he calls "the real bitcoin".
Ver is bullish despite not being able to collect on a wager was with Charlie Lee, founder of the fifth-biggest cryptocurrency litecoin, and three others for 1,000 bitcoin or around $7 million. He predicted that new coins resulting from the SegWit2x upgrade would have more value than the original bitcoin.
The terms of the bet were that at least 100 blocks had to be mined on the new chain, but that's unlikely to happen for now after the main proponents of the update on Wednesday said they're suspending the split to avoid deepening divides in the developer community.
''The way the actual terms of the bet were written is that there have to be at least 100 blocks on the fork in order for the bet to be considered valid and it sounds like that's not going to happen,'' Ver said at a bitcoin meetup last night in Santa Monica, California. He wore a gray blazer with a blue t-shirt underneath that read BCH PLS - BCH is the symbol for bitcoin cash.
''I'm going to use those 1,000 bitcoins to buy more bitcoin cash," he said.
Ver answered questions from the audience of about 200 people for nearly two hours, in what at times felt like a religious revival, with many of the people thanking him for what he had done to promote bitcoin over the years.
According to Bloomberg, the house the event was held at resembled a computer coder's version of a frat house - bare furniture, the guts of computers and wires scattered on counter tops, no toilet paper, and the distinct smell of cat urine in several parts of the house.
Lee confirmed the trade was cancelled for now and says he expects bitcoin will continue being the more valuable coin because the August update called Segregated Witness, or SegWit, allows for a better way to make transactions faster, since it takes some of the work off the main chain.