The Bitcoin family has had a pretty wild stretch. In just the past two weeks, it was subject to extreme volatility even by cryptocurrency standards, saw a spinoff token take center spotlight of the entire digital asset markets, and even witnessed a highly anticipated project get unexpectedly aborted, all leaving the market to go even crazier than usual.
Flip the calendar back to November 8th, when Bitcoin (BITCOMP) was cruising along, peaking at yet another record high by clearing the $7,800 mark for the first time. But just days later, a plummeted price of under $5,500 per coin left many investors frantically panicking if Bitcoin was losing its firm grip on the market.
Bitcoin primarily spiked as high as it did because developers behind a proposed upgrade to the currency called SegWit2x announced they were suspending plans. Scheduled to take effect around November 16, the upgrade was proposed in an effort to increase the speed and cost of bitcoin transactions. However, more and more major Bitcoin developers dropped their support in the last few months, and the prospect was ultimately dividing the Bitcoin community too much to go forward with.
Directly related to Bitcoin’s jumpy behavior was Bitcoin Cash (BCH), the byproduct of Bitcoin’s first fork back in August and newfound rival in the market, which also experienced erratic activity during this period. Trading in the low $600 range on the same day that Bitcoin crossed the $7,800 mark, Bitcoin Cash, which maintains the third largest cryptocurrency market cap at over $20 billion, suddenly skyrocketed to over $2,600 on nearly all exchanges over the coming days. Due to SegWit2x’s cancellation, many ardent investors were dumping their Bitcoin and pouring that capital into Bitcoin Cash, a token which better embodied the vision that supporters of SegWit2x had in mind. Some people even thought that Bitcoin Cash was the new Bitcoin due to the upgrade.
Just days later, the market decided that Bitcoin had become significantly devalued after dropping by more than 30% of its value, so loads of investment money came pouring back into the market leader, effectively curtailing its plunge and spearheading its bounce back. Simultaneously, Bitcoin Cash came crashing back down towards Earth. Currently, Bitcoin’s bull run is back in full effect, trading at around $8,000 apiece, while Bitcoin Cash has depreciated by half its peak value and retreated to a trading value in the low $1,000 range.
