Woo-we. What a day we had yesterday. This was my post yesterday when Bitcoin Cash was at 0.11. It has double to .22 in less than 24 hours. Was it prescient? No. It is the same story line that I have been pushing these last few months. Let us recap.
Is Craig Wright Satoshi and does it matter?
Of course it does not matter if CSW is Satoshi, but if you did think or believe he was, you would have bought into Bitcoin Cash, and look at how much you would have benefited financially. Blind faith? Not really.
CSW is the most fertile mind in the crypto space. Not just technically but economically and philosophically as well. If he is leading an equally competent team at nChain and putting his support behind Bitcoin Cash then you should take notice. CSW through nChain have openly said that they will give free access to Bitcoin Cash for some patents owned by nChain. This is a huge endorsement for Bitcoin Cash.
Bitcoin was hijacked.
Those of us who have been long enough in this space, live through the scorn, ridicule, and pain in promoting a nascent technology which we know in our hearts then will change the world. Bitcoin would not be where it is if not for people like Gavin Andresen, Roger Ver, Rick Falkinge, and many more like them who promoted the idea of Bitcoin with a passion.
The cracks appeared with the scaling debated though the stage was set with the funding for developers when bitcoin was worth only $200. The Bitcoin Foundation fell to the wayside and the money men moved in with Blockstream. Bitcoin Reddit was heavily censored, Gavin was pushed out of Bitcoin Core and the early evangelist were demonised, to be replaced by developers who presumably knows what is best for the rest of us.
Fortunately Bitcoin by design is anti-fragile. If a chasm appear that is deep enough and consensus cannot be reached, the community will fork. This is freedom at its' very best. Bitcoin Cash was just such a fork. It represents the hearts and minds and aspirations of the early adopters and evangelists who harbored Satoshi's vision.
The people supporting Bitcoin Core pushed the narrative that Bitcoin Cash is an alt coin fork like Bitcoin Gold, Bitcoin Diamond and countless others coming up. It is not. It can be and will be the original bitcoin because it has the same mining algorithm. The other forks are just alt coin clones, because they cannot exist on the same mining algorithm as BTC and BCH even if they contain the genesis block. Do not be fooled.
Core has been very successful in pushing forward their agenda convincing the majority of the community on all the social media forums, in pushing their narrative, and they do it to a point of incredulity that you would not expect from smart and intelligent people. My only explanation is that these people were seduced by the technology.
It is sad that they of all people should know that the computer field has always been seduced by people pushing vapor ware and we always move forward with what we got, and what we have now was a simple blocksize increase to solve the transaction backlog issue. That such an easy solution was resisted should have raised flags among these people. I can only surmise that this is a symptom of cultist behavior. The tide is turning and most of these people will come to their senses. When you are so used to the dark, your eyes have to adjust to the dawn.
The Consequences Of Bitcoin going to zero.
Bitcoin (BTC) and Bitcoin Cash (BCH) are like 2 Siamese twins on the same body. When we look at the price of Bitcoin now, we should add the price of both coins. This situation is precarious and unstable for BTC because without the Emergency Difficulty Adjustor it cannot survive on the same mining algorithm as BCH. BTC is forever just one price crash away from oblivion through the Chain Death Spiral.
My greatest worry in the consequences of BTC going to zero was that innocent people will be hurt. Many who owned BTC before the 1 August fork have heeded Core supporters call and sold their BCH as dividends. Some purchase BTC after the fork at prices as high as $19,000. They are now left with BTC that they can't move. I feel nothing but sorrow for their plight. I am truly sorry. Our voices were too small to counter the censorship and the vast and extensive social media propaganda of Core supporters.
Just last week Xapo sold the last of their Bitcoin Cash and converted all their customers accounts to BTC. I warned in the article BTC is dead long live BTC ELI5 that as custodians these people have a fiduciary duty of care to not put funds entrusted to them at a non zero existential risk. If Wences Cesares, a smart and early promoter of Bitcoin can fall into this trap shows the depth of deception that have occurred. Wences will pay a very high price for this decision. Xapo as a company may not survive BTC fall to zero which can happen very quickly, perhaps even before the New Year. The losses and coming litigations will be insurmountable.
BTC as a store of value coin
BTC cannot be a store of value if its' price can drop by 30 - 50%. I find it difficult to understand the reasoning of core supporters when they accept this reality and at the same time argue that it is a store of value. The same logic is at odds when they argue that a store of value coin need not be useful for everyday transactions. It is its' usefulness as a currency that gives it its' store of value property. Not the other way round.
Most of these people are smart, intelligent and have foresight, or they would not have been early adopters. Yet in many cases these same people have acted against their own self interest. If BTC goes to zero many stand to lose all they have worked for in storing their wealth as BTC.
How soon to the flippening.
It can' be too far off. The last time BCH reached .22 the flippening nearly happened. This time the majority of hashrate is still with BTC holding off the Chain Death Spiral, but for how long? some of the factors slowing the inevitable are ;
a) Large holders of BTC know that they have to support BTC price and sell down the price of BCH. Most of these whales have already sold off their BCH and so their ability to sell down the price of BCH is limited. In any case they will find a huge buy wall that will eat up anything they throw at it.
Buying up the price of BTC is an admission that they have made the wrong choice and they are doing it just to buy time for disposing off their BTC in an orderly manner and limiting their loss.
b) Miners have not moved wholesale to BCH because the fees in BTC are higher than the coin subsidy from mining. It is estimated that the fee back log is as high as 1000 BTC. As long as fees are high and as long as the price of BTC holds up they will keep mining BTC. This equation is changing fast.
c) As the price of BTC drops the price of BCH increases. More and more people will make this connection. Already those holding BCH feel secure while those holding BTC are increasing insecure. At .25 the tide has changed and my guess is that at .33 the flippening will really get on it's way, and at .50 it is THE END.