Some people are not at all pleased with any of the forks happening or already in place in the Bitcoin network. The reaction of market and investors has been crazy and there's a lot to discuss about this ongoing—well—drama.
Firstly, creation of new coins (worth billions of dollars) out of thin air is highly suspicious. Bitcoin has a proof of work concept behind it and still people call it a scam. What origin do the forked coins have? The answer? Out of thin air...
I have thought of some names for the forks. Let me share them with you.
1. Bitcoin Crash
Bitcoin Cash was the first fork and more have happened since. I call it Bitcoin Crash because it crashed Bitcoin a little. BTC was on the way up in June with $3000 touched. It came crashing down to $1800—below the support line of above $2000—due to the upcoming fork and the confusion surrounding it.
When it happened, people who had Bitcoin on certain exchanges and wallets received equal amounts of Bitcoin Cash. It was called Free Money and it literally came into existence out of thin air. You can't explain existence or usage of Bitcoin Cash; not now at least when it has massively dropped in value.
2. Bitcoin Gold Diggers
The Free Money (BCC) caused bit of a bad taste for so many people who missed the chance. However, they are the happy ones now with the Bitcoin Gold fork happening. I think it already has happened but I don't give a damn. BTG is more free money and came out of thin air too.
But—quite oppositely to what happened before BCC fork—BTG fork's anticipation period was a crazy time. BTC had been stung by Chinese and JP Morgan's FUD so the prices were ridiculously low. People who had missed the early train knew this was their big chance. They hopped in and made some great gains. Because BTC was bought massively, the price spiked to $6000+ just before the fork.
The rise was caused by excessive demand in hopes of more free money. Even toddlers knew that Bitcoin and Bitcoin Gold will be dumped hard (already being seen).
3. Bitcoin 2x Profits
If you are hoping that Gold Diggers had the last say in forking with Bitcoin protocol, you are in for another fork. SegWit2x is the new fork coming up in November. It will create yet another token which will promise yet another improvement and will provide yet another chance to make free money.
Bitcoin price will rise again after a heavy fall (someone will do something to make that happen, may be Russia or North Korea or CEO of World Bank etc. etc.). People will buy low and hold till the forked coin is out. People will get free coin and sell Bitcoin high.
Almost 2x profit?
Problem with Bitcoin Forks
One of the main problems with Bitcoin forks is that the resulting coins are not adopted as promised. They are fast and new blockchain rules make them better for operations but as I said earlier, Litecoin is better than Bitcoin in terms of speed and ease yet Bitcoin rules.
- Because Bitcoin is the first cryptocurrency.
- Because it's the beginner of decentralized economy.
- Because it will always be the first ever digital coin.
- Because it is the most popular coin in the world.
And much more. Forkcoins (that's the latest subset of altcoins) are not Bitcoins. They are not going to dominate Bitcoin. It is not going to happen. Forkcoins will remain altcoins. What more? They do not have an application except pump and dump trading. Some organizations may try to adopt them as payment options but, in my opion, only because they have a stake in that coin and wish to raise its price.
Consequences on Altcoins
Altcoin have bled when the Bitcoin Cash was about to be created (out of thin air). They are bleeding again while waiting for the Gold fork. They will bleed again when the 2x thing gains some momentum. I do hope that forks stop somehow otherwise altcoins will die and so will the cryptocurrency market.
Altcoins take a massive hit whenever there is a fork coming. Due to availability of cryptocurrency exchanges, it is very simple to convert altcoins into Bitcoin and vice versa. When a fork is imminent, people sell all their altcoins to stay in Bitcoin until the fork happens. Crazy sales lead to drop in value and the market cap shrinks.
The issue with altcoins going down just because of a fork is that some—rather many—altcoins have very good projects behind them. Some of them are already very well established and some are in the development stages. Take Steem for example. Steemit is a working platform with the biggest community among all the cryptocurrency. But still, Steem has fallen below $1 for a significant period now. Cash fork had Steem go below $0.80 too, which says a lot about cons of forks.
The Problem with Bitcoin's Value
We know that Bitcoin has crossed $5000 last week. We also know that it reached $6000 this week. But do we really realize how it happened? It happened because of nothing else than the Bitcoin Gold fork. It didn't happen due to any news of wider adoption of Bitcoin. It didn't happen because some great country adopted Bitcoin as alternative to Fiat system. It happened for free money which was to be created out of thin air.
The current rise in price of Bitcoin is nothing but a temporary inflation. It is already going down.
And that is a fact. It already went below $5400 today. Altcoins are cheap and undervalued so the money will travel from Bitcoin to Altcoins a lot. Price will go down further. It will be hard to come back to $6000 once there is a significant dump. Unless there's one more fork...
Conclusion
The whole drama surrounding Bitcoin is already pushing new enthusiasts away. People who frowned upon Bitcoin earlier have a point to make now. There is every possibility that this fork thing gets out of hand and becomes a scam. Credibility of Bitcoin and cryptocurrency as a viable alternate economy and wealth distribution system will be hurt badly.
I think this fork thing needs to stop. There needs to be some sense because fork after fork will freak the whole world out, just like ICO after ICO has become an annoying and scammy business. Lessons from dotcom bubble burst need to be applied to the cryptocurrency era. Otherwise, future of bitcoin and cryptocurrencies will be dark.
Don't hesitate to disagree with anything said by me. Your comments are most welcome and I will reply to them. Please do consider upvoting and resteeming this post.