So it has come to this. Miners can now jump between mining Bitcoin Cash (BCH) or Legacy Bitcoin (BTC) ViaBTC has enabled smart switching so that miners mine the most profitable coin automatically. How will all this play out? After the BCH difficulty adjustment the BTC pool is 2.38X more profitable to mine. As a result miners have switched to mine the BTC chain. At time of writing BCH has 26% of the total available hashrate.
If you are a BCH supporter you may think this must be bad, right? Not necessarily. In another 100 blocks https://bitcoinwisdom.com/bitcoin/difficulty the BTC chain will adjust its' difficulty. It will then have to keep this difficulty for the next 2016 blocks. The higher the difficulty the more vulnerable it is to a hash migration to the BCH chain and the Chain Death Spiral.
The situation is very fluid at the moment and rather than speculate I will revisit this scenario next week. What we will want to keep tabs on are :
- The new BTC difficulty
- The impact of Segwit in reducing the size of the mempool
- If lightning will be live on the BTC chain
- What base level of hashrate will continue mining BCH even if it is less profitable
- If the price of BCH will be affected by OKcoin and Houbi starting BCH trading
- How will all other exchanges react
It is still not certain that both chain can survive in the long run, but even if they do the value of Bitcoin is the sum of both chain. It will then be a competition for users. Already Yours.com have announced that they will be running with Bitcoin Cash because of the low fees.
Users getting a choice on which Bitcoin they prefer to use is a good thing. Much better than just getting only one option shove down their throat. Developers must now compete for users and miners support. The price reflects the community judgement. BTC inherits the value built up in Bitcoin over the last 8 years. It is theirs to lose.