Bitcoin gold went live early Tuesday morning, and the resulting price action shouldn't be all that surprising.
As expected, Bitcoin gold goes live and BTC sells off:
With people piling into Bitcoin over the last several months with hopes of getting another "free lunch", akin to what happened a few months back with Bitcoin cash, the underlying BTC is now selling off to the tune of roughly 5%.
Which is surprisingly not as large of a selloff as one might expect, or should I say, not as large of a sell off as I might expect.
Though we are still very early in the process, watch what happens over the next couple days for a better indicator. Once people start getting credited with Bitcoin gold in their wallets.
What happened last time?
The last time BTC forked, Bitcoin cash was created and when it was distributed to holders of BTC, BTC did not sell off by a corresponding amount, which was rather unexpected.
Instead, the result was a "free lunch" to all BTC holders.
Roughly $7 Billion of value was created out of thin air, poof.
This time, people have been rushing into BTC hoping for history to repeat itself with Bitcoin gold.
The same distribution is set up with Bitcoin gold. IE each and every holder of BTC will be credited with an equivalent amount of Bitcoin gold.
Some Specifics:
Bitcoin gold hard fork is currently underway but most likely the newly created currency won't start showing up in wallets and exchanges for a couple days yet.
There are over 20 wallets/exchanges stating they will support Bitcoin gold for their clients.
However, Coinbase is not one of them.
Take that with a grain of salt though because they said the same thing about Bitcoin cash at first, only to reverse their decision a few days later.
Bitcoin owners on Coinbase will receive Bitcoin cash tokens in early January of 2018.
Will it work out the same this time?
That is what everyone would like to know (myself included)!
It's tough to say at this point, but I do know that from all my years in finance that when everyone is expecting markets to do one thing, they usually do something else...
Often the exact opposite.
In this example, if everyone is expecting to get Bitcoin gold AND not have the underlying BTC go down by a corresponding amount, that probably won't happen at least according to what I have observed in the past.
Yes cryptocurrency is different and yes this is not an apples to apples comparison on my part, but markets are markets and people are people. People tend to repeat the same cycles over and over gain no matter what they are trading.
In my opinion, Bitcoin cash was likely an anomaly, a unicorn, something that we won't see again.
We will know a lot more in the coming days/weeks as the distributions of Bitcoin gold get made to all the BTC holders.
Stay informed my friends.
Sources:
http://www.businessinsider.com/bitcoin-price-down-45-after-bitcoin-fork-2017-10
Image Sources:
https://www.coindesk.com/bitcoin-gold-know-blockchains-next-split/
https://www.coffscoastadvocate.com.au/news/one-ugly-visitor-giant-female-cane-toad/806213/
