Today, Bitcoin Cash (BCH) continues to shadow its big brother. However, as the crypto market begins to show a little more stability, there are some that are curious as to why Bitcoin (BTC) hasn’t experienced the surge that was expected.
This morning, all but a handful of the top 100 cryptocurrencies continue an upward trend that would indicate a degree of market recovery as countries around the world begin to turn the tide against the coronavirus.
Although Bitcoin has gone up a respectable 3.5% over the last 24 hours, many economists expected a more dramatic surge in value.
With the announcement that Italy will be extending their lockdown period, the UK expected to introduce tighter measures to control the spread of the infection rate and Donald Trump stating that self-isolation over the next 30 days is vital, everyday individuals are beginning to consider crypto investment as a way to safeguard against the threat that COVID-19 poses to national economies.
This increased demand alone has the potential to cause an impressive rise for Bitcoin, but the price of BTC still trades around $6,450 at the time of writing.
It is now speculated that the problem is one of scalability. Bitcoin is only able to process around 7 transactions per second, which compared to its main competitors is extremely slow and expensive. This limitation can also cause a bottleneck, where unconfirmed transactions become clogged in the mempool of the network.
This inherent drawback would seem to defeat the purpose of Bitcoin, as a decentralised peer-to-peer payments system and is the very thing that led to the creation of Bitcoin Cash (BCH). The improvement on scaling has, so far at least, not been enough to tempt people away from the crypto pioneer, but if demand continues to increase, that could soon change.
It all comes down to block size. Bitcoin originally had a block size of 1Mb (2Mb today), whereas Bitcoin Cash, which shares the same codebase as its parent coin, began with a block size of 8Mb. This meant that each block could store more information and would avoid the network overload that BTC experienced back in December 2017.
While it is clear that Bitcoin Cash has yet to use the full potential of its increased block size, this distinguishing feature could become an attractive quality as more of us seek out cryptocurrency in a bid to protect our finances and earn from home.
Roger Ver – The well-known Bitcoin angel investor, believes that BCH is closer to the original philosophy behind Bitcoin and will have the larger market cap, trade volume and user base in the future.