Behind the bitcoin price collapse: a coin circle chiefs is war

Source: the Economic Observer

The early morning of November 15th, bitcoin prices fell below $6000 mark, the minimum fell to $5544, to their lowest level since 2018. The bitcoin price “diving” influence, the market value of digital currency fell sharply, according to CoinMarketCap data show that in the 15 day, the overall market value of digital currency fell more than 300 billion dollars.

$6000 bitcoin is an important psychological barrier, the psychological barrier breakthrough for the confidence of the market has brought great impact, a feather, a bitcoin investors on the Economic Observer described on the day of the morning.

Bitcoin cash (BCH) hard bifurcation is considered to be one of the causes of the bitcoin prices plunge, the so-called hard bifurcation is when a digital currency community consensus for the original technology of digital currency differences, in the original chain points out a new chain, and generate a new currency by this is like a branch bifurcation, and lurking in the technology behind the consensus is often a conflict of interest.

BCH itself is a bifurcation currency bitcoin, 2018 year, the BCH community for disagreement technical route of the coin, the formation of factions, the brewing of hard branch. The hard fork in the early morning of November 16th finally landed, at present the two sides are in a large-scale “war” – that is, by force influence each other currency stability and trade in the short term is difficult without a winner.

Bitcoin prices by reason of great impact is hard to participate in BCH bifurcation both sides hoard rich resources, these resources include a large number of digital currency count machine, stock force, including bitcoin, BCH, the conflict is thought to trigger market panic.

Since hitting a peak in the early 2018 years, the situation of shrinking constantly showing the entire digital money market to bitcoin mainly, a digital currency fund for economic observer said that the fundamental reason is that the capital market the entire disk is not enough to support the high price of money, the follow-up funds also nearly exhausted. In this context, whether it is in the EOS super node or the BCH campaign is hard to re inspire the bifurcation of market confidence, but it brings the opposite effect.

In the “bear market” bitcoin currency price, but also can survive this round of “bifurcation robbery”?

Bifurcation carnival”

BCH hard bifurcation is considered to be an important reason bitcoin prices fell, the hard bifurcation has been officially implemented in November 16th 40.

In the two hours before the execution of the bifurcation hard, digital currency investors circle has ushered in a long carnival. In more than half of the “bear market”, digital currency of active investors decreases sharply, but in two hours, live, discussion continues to spread in all kinds of media channels, social media, some investors regard the event as the field of digital currency “world cup”.

Why bifurcation will cause the market and investors so concerned about this?

The answer had to return to the BCH itself. BCH is one of the bitcoin currency bifurcation, in August 2017, in order to solve the problem of small capacity block bitcoin bitcoin — a block of the capacity of 1MB, which is thought to lead to low efficiency of bitcoin trading is an important cause in a large number of miners, bitcoin holders and technical personnel under the support of BCH came into being as a branch of bitcoin currency. There are a lot of strong support, BCH has gradually become the mainstream in the digital currency after the birth, the price was $500.

The birth of BCH who has two worthy of special attention, one is Craig Steven Wright, the Australian businessman claimed bitcoin is the founder of the Cong himself, has a certain influence in the bitcoin community, dubbed the Macao Cong; another is Wu Jihan, founder of the bit, the company has a large number of bitcoin mining machine, force.

A study on the blockchain technology for economic observer said, after a successful BCH from bitcoin is closely linked with the Craig Steven Wright bifurcation, and Wu Jihan resources, influence, this is almost two people and their allies led to the creation of BCH.

However, in the middle of this year, the BCH community has been a technical route of the differences, in short, one side is more inclined to “bitcoin fundamentalism”, namely the bitcoin system itself is perfect, BCH only need to be paid attention to the trading system like bitcoin, and continue to expand the block the capacity can be; and the other is that BCH should be toward the “infrastructure” route development, let more scenarios can be realized based on BCH. Craig Steven Wright and its allies to support the former view, Wu Jihan is agree with the latter view.

Draw sword against allies.


In the next three months, both sides began to dispute through the Internet and other influential investors, technical people have to stand in line, forming a faction. The concern is that BCH prices also climbed in the dispute.

The technical route of differences and problems hidden in that war triggered at any moment.

The night of November 14th to 15 am, a “social media news figure Wu Jihan” Macao will head-on the Cong in the major channel for the spread of this screenshot was eventually falsified, soon, Craig Steven Wright responded to saying bitcoin zapan to $1000.

Market sentiment yichujikui, November 15th, bitcoin prices diving, fell below $6000, $5700 of floating up and down in the fashion to the deadline.

In the market level, BCH hard finally opened the curtain on the 11 bifurcation 16 April 2 morning, after hours of waiting, the hard bifurcation results, a new digital currency, respectively: Wu Jihan party BCH ABC and Craig Steven Wright BCH SV, at 16 on the morning 9 34, ABC BSV 31 a block party leader.

However, this is not the end, a BCH investors believe that both sides should not be given fire, the bifurcation is completed, must be through the “battle” winner.

The so-called war is that on the other side of block chain system put in enough computing power, affecting the normal operation of each block chain system and through a series of methods, such as the manufacturing of a large number of invalid block, hinder the normal formation of the chain, and make it impossible to carry out the transaction etc.. In this process requires a lot of input digital currency machine to produce enough computing power, also means huge capital consumption.

According to the investor’s analysis, BCH is part of the transaction that will battle victory in a large number of resources, let the other currency stability problems such as double pay, allowing investors to the currency of doubt, in the end the currency abandoned by the market.

There is no doubt that this will be a protracted war”.


In the past more than half a year, the whole market of digital money market value showed a shrinking trend, a variety of digital currency completely zero or almost no turnover, compared with other digital currency bitcoin, still maintain a certain toughness, one is in the global digital currency, bitcoin market capitalization accounted for from the rising to 50% 30% more than 2 months this year, has become the main supporting point value.

But in the event of the bifurcation, the points show its vulnerability. A digital currency long-term investors, digital currency fund management of the Economic Observer newspaper said that the bitcoin prices fell sharply and not just because of some independent events, but bitcoin long sideways to the market confidence consumption, the most fundamental reason is that the market has no money to support prices.

The long-term downturn in the stock market so that some investors and employees who lost patience, a once for dozens of ICO projects provide market management who has temporarily left the field of digital currency, return to A shares.

The evacuation and the miners, in this year’s 10 month bitcoin mining difficulty going down bitcoin mining difficulty and input power is proportional to the count, which means that the miners are reduced into this market. The time in the past two years, although the bitcoin price ups and downs, the difficulty of mining is essential to maintain a rapid growth.

“The role of inertia before growth, there are reasons for technological upgrading, but the miner’s patience is limited after all, continued to see an adequate return, the difficulty has been improved, will reduce the subsequent investment, it is devoted to reduce, the difficulty will be reduced, this is bitcoin own the coordination mechanism”, a bitcoin miner said.

There were no obvious signs of these structural decline can be reversed in the short term. In this vulnerable stage is open the “BCH war” drama, no signs can end quickly.

Under the pressure of heavy bitcoin prices will go where?

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