Bitcoin's "Day Of Reckoning" Has Arrived: Traders Welcome "Bitcoin Cash" As Network Splits

Tyler Durden's picture

After a brief delay, the first bitcoin cash blocks have been mined and trading in the new cryptocurrency has begun - albiet at a sizable discount to bitcoin.

BCC token are trading at 0.097 bitcoin, about $261, on Chinese exchange OKCoin.

By comparison, bitcoin is trading at $2,700, and ethereum at $219, according to CoinMarketCap.

* * *

After more than two years of internecine struggles over how to expand bitcoin’s ability to quickly process transactions, the long-feared bitcoin "day of reckoning" has arrived. The bitcoin network has split into two separate blockchains, causing the creation of a new cryptocurrency twin to the original bitcoin.

In the meantime, the collapse that some bitcoin doomsayers envisioned has so far yet to materialize; the original cryptocurrency was off 3% in recent trade, while most of its peers were higher on the day.

After announcing Saturday that they would go ahead with the fork, bitcoin miners running the alternative bitcoin software will soon begin producing the new coin, known as bitcoin cash. Bitcoin cash raises the limit of how much data can be stored in a single “block” on the bitcoin blockchain, which proponents say will help increase transaction speeds while tamping down rising transaction costs.
Though no blocks of bitcoin cash have yet been mined, Kraken, one of the most popular US exchanges, has added it to its interface.

Other exchanges are still figuring out how they will handle cash, according to CNBC.

"Coinbase said it will not support the new bitcoin cash. The firm operates the GDAX exchange, which said in an email alert it has temporarily disabled bitcoin withdrawals and deposits Tuesday "in preparation for the upcoming fork."

 

Bitfinex, which has nearly a third of U.S.-dollar bitcoin trade volume, tweeted Tuesday morning that "We will stop processing $BTC deposits at noon UTC until the situation has settled. Deposits after that time will not be eligible for $BCH."

As of press time, bitcoin cash miners were still waiting for the first new coin to be processed, according to CoinDesk.

According to Btcforkmonitor.info, the bitcoin blockchain has produced 478562 blocks, compared to 478,558 for the alternative Bitcoin Cash blockchain.

 

At press time, miners dedicating computing power to that blockchain were still looking for their first block, an event that would mark the formal creation of its cryptocurrency.

Bitcoin cash is supported by a minority of miners and developers who objected to a feature of the more popular Segwit2x update that would’ve improved the digital currency’s scalability by routing more transaction data over peripheral networks, thereby taking pressure off the main blockchain. Segwit2x will also increase the bitcoin blockchain’s block size to 2 megabytes. According to Shapeshift CEO Erik Vorhees, the only major mining pools that support cash are ViaBTC and Bitcoin.com.

Segwit2x has the support of most of the community’s miners. Data from blockchain.info show that 90% of the network’s mining power is signaling support for Segwit2x, higher than the 80% threshold needed to make the software update official.

If recent moves are any indication, Tuesday will be a wild day in cryptocurrency markets as investors wait to see how the market will react to bitcoin cash. Ethereum endured a similar network split last summer that created Ethereum Classic, a separate token that’s seen its price plunge as investors favored the original Ethereum token over its newly created peer. Now investors are wondering: Will a similar dynamic play out with bitcoin and bitcoin cash?
 

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Bigly's picture

I wish I had listened to fonestar....

;-)

Looney's picture

 

Is it BitCoin or BitCon?  ;-)

Looney

Eager Beaver's picture

Before all the "Bitcoin isn't a currency because I can't spend it at Amazon" begins, here:

http://bitcoinist.com/2-3-billion-people-use-bitcoin-amazon/

kliguy38's picture

I do have sum Tulips I'd like to digitize

Implied Violins's picture

I have a digit I'd like to digitize...

Looney's picture

 

I’d like to digitize an extended middle-digit.  ;-)

Looney

Manthong's picture

 

I am trying to reconcile the concepts of Bitcoin and Cash in the same reference frame…

My brain hurts…

Just fork me with a spoon.

I guess I will just buy another bag of junk.

 

SafelyGraze's picture

a transaction is not valid unless it includes the name, ss#, EIN, gps, email, and fb of the person/entity executing the transaction

 

Manthong's picture

 

What?... no blood type,  DNA code, appendage length, Eigen face code or anything?

Now there is true anonymity for you……………..

Manthong's picture

Most people would not know real money if they were hit in the head with it.

Oh. Let me try smacking you with this sleeve of Morgans….

Get the picture?

MagicHandPuppet's picture

"Beep... beep... beep... beep..."

^ That's the imaginary sound of my invisible truck backing up to load up on "coins" which have a mass of zero.  What could go wrong?

Looney's picture

 

… "Beep... beep... beep... beep..."

This is how a digital fart sounds like.   ;-)

Looney

Harlequin001's picture

Explain to me again why bitcoin is worth 11 x etherium?

Perhaps I'm missing something here, or maybe nothing at all...

GodSpeed_00's picture

Explain why Gold is worth more 7490% more than Silver.

Silver Glock's picture

Bitcoin is considered to be 11 x more valuable than Etherium because there is no limit on how many ether tokens will be generate (while Bitcoin has a hard limit of 20999999 max)

CJgipper's picture

number of units.  Purpose.  Market adoption.  etc.

I personally think that market cap wise, ETH will pass bitcoin.  But it could be that Bitcoin becomes gold and ETH/LTC become cash, and RIpple becomes international bank settlement system.  THat's what they're all shooting for, and it very well may happen.

SILVERGEDDON's picture

Yeah, this frenzy of articles and pumpers yelling at you to get on the Crypto Express Hyperloop Monorail Space Train looks great - until you look down the track, and see a big IRS / Gooberment steel wall set up in the distance. 

Get some popcorn - the train wreck is gonna make the Swiss bank account fiasco look like a fart in a windstorm.  

tmosley's picture

Do you really believe that?

If not, then why do you say shit like that? You think telling obvious lies makes your case stronger?

SILVERGEDDON's picture

Hey, it seems to be your primary M.O., you disingenuous pumping twat. 

tmosley's picture

What lies have I told?

You just slander ANYONE who doesn't conform to your worship of the precious. You are really the worst kind of person.

Pickleton's picture

"Bitcoin cash raises the limit of how much data can be stored in a single “block” on the bitcoin blockchain, which proponents say will help increase transaction speeds"

 

 

First time I ever heard anyone say making data sizes larger will increase speed.

Eager Beaver's picture

Increasing capacity is always how you improve speeds/times in IT. One of the more insidious forms of attack on the 'net is DDOS, in which you are bombarded by an overwhelming amount of small packets, brings your network to it's knees.

runswithscissors's picture

You got forked in the behind

BullyBearish's picture

7 words:

DIS IN TER ME DI A TION

 

love it, live it, spread it around...

Eager Beaver's picture

Then you should go right ahead and do that, Mr. Smarty Pants, see how many people use them. 

Herd Redirection Committee's picture

I've heard the argument for what Bitcoin can be used for, getting assets from A to B.   Over borders, past capital controls, etc.

I have yet to be convinced that these price levels are 'buy and hold' levels.  Just smells like a muppet fleecing is coming in the 2nd half of the year.  It will be interesting to see how cryptos hold up if there is a stock market crash, this Fall.

Eager Beaver's picture

I don't think you can be too cautious. We all whine about how much the markets are manipulated, but when we encounter a truly free market, with all the risk and volatility that comes with it, we complain that it's too dangerous. Right now, we're setting on about 3/4 of the total supply of Bitcoin, in another few years it will all be mined, and then what? If it survives, and it may not, then it's going to be worth significantly more than it is today. But that is in terms of fiat. What does that even mean in this world? I don't really want a billion shekels for my uBTC, I want a cheeseburger.

centipede's picture

In another few years there will be another few thousands new cryptocurrencies created. What is going to be their price in bitcoins? It is going to be totaly arbitrary in the same way as the price of other cryptos is in bitcoins today. And the price of bitcoin and others cryptos in $ can chage dramatically bothe ways up and down. Any kind of prediction is an utter nonsense.

HungryPorkChop's picture

Market is too controlled by bots.  Anytime it starts to crash the market reverses 1,000 points overnight or unexpectably breaks.  DOW may never crash again given all the FED, govt, bank and 401K money pumped into these markets, just occasionally correct before ramping higher.

kochevnik's picture

Clearly Treasury wants to destroy remaining sovereign central banks to implement Soviet style price fixing worldwide in it's universal Bolshevik dollar

Michael Musashi's picture

Well, I made a nice profit from all this noise. Used a little of my profits to shop at Target. You can't do that with Tulips, my friend, but you can use your two lips to earn some money from foreign sailors and for that I commend you.

Winston Churchill's picture

You can't spend it anywhere without being tracked.

And that is the fundamental problem that nobody wishes to address.

Anonymous my arse.

Eager Beaver's picture

I agree. Bitcoin is not anonymous, therefore it's not fungible. That doesn't invalidate Blockchain technology, just because one implementation has chosen a weak design.

Dirtnapper's picture

Then you need to use ZEC/ZEN/Hush or Monaro or any of the stealth cryptos.  Having said that, ZKsnarks is coming to Ethereum in Metropolis so you can wait another couple of months and do it with Ethereum. 

buzzkillb's picture

You are reading my mind on those, especially HUSH and ZEN. DNR is another interesting under the radar coin that has fast transaction times and stealth addresses. Just saw one of my wallets fork the BTC into BCH. Crypto has been a wild rollercoaster to watch and did not want to miss out on this.

2 more sites I browse that accept Bitcoin are, Overstock and Newegg. Next up, is what ETH does.

inhibi's picture

Misleading to the extreme.

Just cause you can, doesnt mean you will. How many people have purchased items on Amazon in BTC? A thousand out of the millions of transactions a day? Amazon works in dollars, not BTC. They price things, like 99% of the companies who have majority assets in the States, in dollars.

There must be something wrong within the minds of the BTC cultists: do they not see the conversion fees? Do they not see the time, the effort required to make purchases in BTC? Do they not realize that 99% of the world earns money in their country's fiat? Do they not realize that 99% of people's cash resides in a bank? Do they not see how people purchase almost everything on credit these days? Do they not see the volatility in the cryptocurrency market? The increasing competition?

Are they blind, stupid, or both?

What happens when there is 100 cryptocurrencies backed by different factions/countries/banks? What happens when the blockchains get further divided? How is this a sane long-term investment?

We have all the signs of the calm before the storm: record number of Millenials (the new poor) opening up brokerage accounts, market overpriced by estimated 35%, a rapidly approaching auto industry collapse/contraction, a massive amount of QE cash falsely propping up various markets, corporate raiding in the retail sector, and these cultists think BTC will somehow make them ALL rich - while investing at the highs.

Its 2007 all over again. Just like when 10 people I knew decided 2007 was the time to go buy multiple houses and flip them because the market "will go up up up".

 

Herd Redirection Committee's picture

Millenials have never seen a down day on the Nasdaq in their lives.  Should be fun.

indio007's picture

Wow waht a naked appeal to majority fallacy.

Who the hell cares about fiat.

Lemmings follow each other over cliffs.

What's your point.

adr's picture

When you can no longer make any money working, there is only gambling left.

Why is it that poor people buy the most lottery tickets? A rich person has exactly the same odds of winning, but they don't buy lottery tickets. Don't tell me a millionaire wouldn't like winning $250 million more.

GodSpeed_00's picture

Rich people gamble and buy lottery tickets all the time, there are just more poor people than rich people is all.

PT's picture

Becoz you can't lose the munny quickly enuff with lottery tickets.  Try the casino:
http://www.telegraph.co.uk/news/worldnews/asia/1368368/Gambler-Packer-lo...

https://www.google.com.au/search?q=loses+100+million+at+casino&ie=utf-8&...

Though I do wonder if some of those casino "losses" were just a way of executing a transaction and avoiding some kind of fees in the process. 

Eager Beaver's picture

Wow. Where to begin. You are so lose on your facts and assertions, I'd love to see you back up 5% of what you just wrote. Not even gonna try.

Placerville's picture

My countries fiat does not gain value like Bitcoin, nor does any other countries fiat.

Mat Cendana's picture

But US$ had over most other currencies. Since the third quarter of 2014.

Golden Phoenix's picture

Did you not see Amazon shoppers who buy with bitcoin through Purse.io pay 15% or more less than everyone else?

ejmoosa's picture

One thing for sure-Gold Miners will never have to explain what their product is.

99.9% of the public has never heard of Bitcoin much less understand it.

Meanwhile Gold and Silver were already successful currencies.