Bitcoin cash (BCH), an altcoin that split off from bitcoin in August, is up 32% against the dollar to $834.49 as of 09:50 am EST on Friday. The Segwit2x hard fork cancellation put bitcoin on track for its biggest pullback of the week, as investors worry about slow transaction processing speeds. Bitcoin (BTC) dropped below $7,000 on Friday, having lost over $1,000 in 48 hours. Bitcoin cash and other altcoins reached multiday and multiweek highs on BTC’s seesaw volatility.
Bitcoin cash (BCH) jumped by 32% on Friday, to a 12-week high of $834.49. Analysts say the surge was caused by both investors and speculators pulling out of bitcoin (BTC) after the Segwit2x hard fork was called off.
Originally planned for mid-November, Segwit2x – a hard fork designed to improve the speed of transactions on the bitcoin network – was cancelled due to “insufficient consensus”, according to a joint statement released by key figures supporting the split.
Concerns over slow transaction processing speeds have weighed on BTC’s performance, all to the benefit of bitcoin cash, that allows for bigger “blocks” of transaction to be processed, speeding up the network. Other altcoins have also reached multiday and multiweek highs on BTC’s weakness.
Bitcoin dipped in the red by 5% on the day, having lost well over $1,000 in less than 48 hours, to $6820.72 at the hour of writing. The general consensus is that the Segwit2x hard fork and CME’s recent announcement regarding bitcoin futures have been the main drivers of BTC’s price surge up until recently.
“The delay to Segwit2x has damaged confidence amongst bitcoin investors concerning the much-needed resolution to speed up bitcoin’s slow processing speed,” Joshua Raymond, a director at the foreign-exchange and CFD broker XTB, told Business Insider.
“Everyone was hoping the Segwit2x would address this but unfortunately, the delay due to a lack of consensus on the mechanics has affected confidence. Confidence on transaction speed in Bitcoin has deteriorated significantly in recent months. As Bitcoin Cash enjoys much faster transaction speeds, we have started to see a recycling of positions out of Bitcoin into Bitcoin Cash as a consequence,” Raymond explained.
Despite today’s decline, bitcoin remains up by over 600% on the year.
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