We tried to avoid writing about it but we just couldn’t. When something as big as the most traded, loved, hated, discussed, envied, reviled alternative currency decides to do a hard fork, well, we just couldn’t avoid it. What does it mean to develop a cryptocurrency that is supposed to be based on rock-solid software and immutable structure only to have a group of your users / investors / miners / owners say this isn’t working as planned and we need to change it?
We’re talking about Bitcoin. What a complicated life it has led already in its relatively short time on earth. With its mysterious beginnings and now its astronomical valuation, Bitcoin is a true trailblazer in the world of cryptocurrencies. So, how do you get from there to Bitcoin cash, the newest iteration of Bitcoin? From one Bitcoin blockchain to two? In a word, scale. Or put more completely, the desire to tighten up the lags that have occurred with requests for processing and actual mining.
Feels like we might just be experiencing the Bitcoin equivalent of the New Coke vs. Coke Classic challenge. Except that Coke has never come near costing $3300+ a can. Sure Bitcoin cash currently trades at a valuation that’s several orders lower than Bitcoin, but for how long? If it lives up to its hopes, then speedier transactions may just prove far more compelling than its progenitor’s current process does. Also, the split meant that any Bitcoin owners received the same amount in Bitcoin cash, essentially doubling their holdings. A few cryptocurrency exchanges like Coinbase are not recognizing Bcash yet, so those unlucky holders lost out on the doubling effect. Still, this approach is a compelling strategy with few seeming downsides—for now. So, for those of us watching this event from the sidelines, it appears that the battle for Bitcoin supremacy is now on.
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Here are the articles that inspired and informed this newsletter. We recommend them to you as interesting data points in your consideration of education and decentralized technologies.
- WTF is bitcoin cash and is it worth anything? — Fitz Tepper
- Why Did Bitcoin ‘Fork’ Today and What is ‘Bitcoin Cash?’ — Ben Popken
- Update on Bitcoin Cash — David Farmer
- ‘Bitcoin cash’ potential limited, but a catalyst could be looming for it to take off — Arjun Kharpal