The price of bitcoin crashed by 29 percent over a four-day period after plans to upgrade its underlying technology were shelved, leading many to turn to bitcoin cash.
On the 8th November, bitcoin’s price reached a new all-time high of $7,800 after the organisers behind the SegWit2x software upgrade announced that they were ‘suspending‘ it due to a lack of consensus. However, in the days that followed bitcoin’s value steadily declined, falling as low as $5,500 on Sunday, a drop of 29 percent in four days.
The digital currency’s price has recovered, and at the time of publishing is over $6,500 with a market cap worth $109.6 billion. Nonetheless, bitcoin’s volatile price swings will do nothing, but fuel critics who firmly believe that the cryptocurrency is a bubble.
The drop in value comes at a time when the community were gearing up for the planned SegWit2x hard fork, which would have seen the creation of two different blockchain each with their own set of coins. The upgrade was also designed to speed up the number of transactions bitcoin’s blockchain currently processes. Yet, due to a lack of support the plans were put to one side to prevent a divide within the community.
However, the decision not to go ahead with the planned hard fork has seen many jumping ship and turning to bitcoin’s rival, bitcoin cash. This cryptocurrency was created earlier this year as a split from bitcoin and promoted as the ideal solution to the cryptocurrency’s scaling issues. Up until now, though, support for the third-place digital currency has failed to gain much traction.
Yet, in the last seven days, its value has risen by nearly 80 percent, pushing it, for a short while, into second place, ahead of ethereum. On Sunday, it was valued at over $2,400 with a market cap worth over $41 billion. Trading on Monday has seen its value drop slightly to $1,140.
Despite the significant drop in value for the number one digital currency confidence appears to remain with it. Given the fact that it has increased its price by $1,000 indicates that it will regain back its previous highs. As with past falls in the price of the cryptocurrency it has, time and again, risen to new heights. Surely the same will happen again.
Additionally, with the CME Group announcing that they are planning to launch a bitcoin futures by the end of 2017, this will aid the recovery of where the currency is going in the future.