As anyone that's followed my previous posts know, I made the case that Segwit2X or (B2X) would not become the 'real bitcoin' and that (BTC) would win out and maintain its support as the 'official' or 'authentic' Bitcoin. With the cancellation of the Segwit2X fork we are now seeing a gain in strength of Bitcoin Cash with an increase of hashpower that as of this writing is overtaking that of the traditional (BTC). The price of Bitcoin (BTC) is also down about 15% from its highs and curently is in the $6400 range. So why is this happening? This is because the surging price of Bitcoin Cash (BCH) is making it more profitable to mine and thus many miners are making the choice to move over to to Bitcoin Cash (BCH). There are some that are predicting that ultimately should the profitability of mining remain in Bitcoin Cash's favor that the original Bitcoin (BTC) will see a continuing downtrend in price with Bitcoin Cash (BCH) eventually overtaking it in market cap. At that point the assumption is that large miners and exchanges will crown Bitcoin Cash (BCH) as the 'winner' in the Bitcoin competition and rebrand (BCH) as the 'real' or 'official' Bitcoin, leaving (BTC) to be called a legacy Bitcoin. So will this happen and is there a solution to this fractured 'Bitcoin' community?
I for one do not think the Bitcoin Cash supporters will be able to break the psychological attachment to the original Bitcoin (BTC) that exists among the vast majority of Bitcoin holders. The primary reason for this is because as we have just seen with Segwit2X, as more of the general public has invested in Bitcoin, including the start of institutional investors with the announcement of futures trading by CME and the CBOE, I believe the emotional and psychological attachment and identification of BTC as the 'authentic' Bitcoin is too strong at this point for any challenger to supercede this. Even if for practical reasons a quicker transaction time, cheaper transaction cost and increased mining profitability makes a challenger such as Bitcoin Cash or any future challenger attractive as a replacement the reality is that switching over at this point to a new fork as the 'authentic' Bitcoin would simply create too much uncertainty that in the future yet ANOTHER fork could then replace this new Bitcoin. This kind of 'replacement' pattern completely destroys people's faith that Bitcoin is a reliable store of value and will prevent the vast majority of people from trusting their money is safe in any kind of Bitcoin. Imagine if you had your life savings in US Dollars in your savings account and had to worry that at any time a 'fork' of the US dollar could come along...say a US Dollar 2X...and make your life savings worthless. Of course people would then lose faith that the US dollar was a dependable and trustworthy place to store their money. That is the risk that Bitcoin Cash adoption creates and in my opinion the vast majority of people recognize that this undermines the 'trustworthiness' of Bitcoin.
But what about the problems that exist with today's Bitcoin (BTC) such as the slow transaction speeds and increased costs compared to the fork and even other altcoins such as Litecoin, Monero, Dash etc? What I see as a possible solution is for the Bitcoin community to accept a two-pronged solution. Bitcoin (BTC) would see itself as more of a commodity (like gold) in which people can store their money and use it primarily as a store of value with only occasional use for normal purchases. Bitcoin Cash (BCH) on the otherhand would play the role of currency, but not so much as a commodity, and will be used for daily currency use due to its quicker transaction times and lower cost.
As we move forward future forks with improved technology of Bitcoin Cash could always keep the currency fast and cheap for transactions and each new fork could be automatically renamed 'Bitcoin Cash' with the legacy coin falling to the wayside. People that had savings in Bitcoin Cash would move their funds into the new fork so that they would always have the most current technology and would not lose value. On the other hand those that held onto the 'old' version of Bitcoin Cash would risk losing value as liquidity decreased over time of the old protocol. This 'dual Bitcoin' system would encourage Bitcoin users to store savings and investment for the long haul in traditional Bitcoin (BTC) while encouraging them to transfer small amounts to Bitcoin Cash (BCH) to be used as a currency when needed.
This would be akin to people that hold stocks and bonds in a portfolio and occasionally sell to raise cash for a purchase. By embracing both BTC and BCH it also prevents us from ever having to worry about outside challengers and new forks from bringing uncertainty into the community. We'd have a reliable partnership for both long term and short term uses. In fact the BCH community could even decide on an annual 'update' of the BCH protocol to incorporate any new technologies and the values of BTC and the new BCH would automatically adjust since this would be happening in a predictable manner. If my prediction is correct and this dual Bitcoin scenario is accepted then we should slowly see near parity in value between the coins. Bitcoin Cash (BCH) will rise to about half of what Bitcoin is now and original Bitcoin (BTC) will drop to meet halfway, giving total market cap of both equal to what they were before the Segwit2X cancellation.
Cryptocurrency is a relatively new technology that contains features of multiple asset classes including as a commodity and a currency. With new technologies new regulations and procedures sometimes need to be devised and adopted in order to keep the benefits of the new technology from being mitigated by old human habits. By adopting a 'dual Bitcoin' system of both long term commodity (BTC) and short term currency (BCH) the Bitcoin community will gain the best of both worlds and do away with the rivalry that has slowed down mass adoption and acceptance.
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