The bitcoin cash price has exploded this week following the indefinite suspension of the SegWit2x hard fork that was scheduled to activate on the main bitcoin blockchain next week.
Earlier this week, advocates for the on-chain scaling proposal SegWit2x called for the hard fork’s cancellation due to a likelihood that it would cause Bitcoin to split into two competing cryptocurrencies. The suspension of SegWit2x ensures that, at least until a scaling solution is implemented, bitcoin transaction fees will remain high.
This development has led bitcoin cash proponents to declare victory over what they call “Legacy Bitcoin,” with Bitcoin Classic developer Tom Zander even suggesting that bitcoin cash will be known simply as “bitcoin” within six months.
And, apparently, traders and investors are at least moderately bullish on this prospect, because the coin that claims to be the true heir to Satoshi’s vision has initiated a phenomenal rally, even as bitcoin, ethereum, and most other prominent cryptocurrencies are bleeding.
The bitcoin cash price has surged by nearly $200 in the past day alone — a rise of more than 30%. For the past month, the bitcoin cash price is up more than 150%. Bitcoin cash is currently trading at a global average of $849, giving the coin a $14.2 billion market cap and positioning it to soar past the all-time high near $900 it set shortly after its creation in mid-August.
The majority of bitcoin cash demand is concentrated on cryptocurrency exchanges located in South Korea. Three of the four highest-volume bitcoin cash exchanges are located in the country, and they combine to account for more than two-thirds of the coin’s $3 billion daily trading volume.
It is unclear whether the bitcoin cash price will be able to sustain this rally, but it will likely depend on how merchants respond to rising bitcoin transaction fees.
Much of the bullishness surrounding bitcoin cash stems from speculation that — even if bitcoin continues to be treated like “digital gold” — bitcoin cash can become the cryptocurrency of choice for everyday transactions. To wit, decentralized marketplace OpenBazaar revealed yesterday that it will no longer support bitcoin exclusively but will actively explore other payment options that offer more reasonable transaction fees.
However, time will tell whether that void is filled by bitcoin cash, another cryptocurrency such as monero, or even bitcoin itself once off-chain scaling solutions like Lightning are integrated into the network.