On a recent episode of The Crypto Show, longtime Bitcoin angel investor and Bitcoin.com CEO Roger Ver, who has been referred to as “Bitcoin Jesus” due to his early adoption and advocacy of the technology, shared his thoughts on Bitcoin Cash, an altcoin that forked off from the Bitcoin network in August of this year.
During the interview, Ver discussed the need for cheaper transactions on the Bitcoin network, the possible reasoning behind bitcoin’s continued price rise, and the fact that he now holds more of his cryptocurrency wealth in Bitcoin Cash than Bitcoin (or any other cryptocurrency).
Still Early Days, But Ver is Confident Bitcoin Cash Will Overtake Bitcoin
In the early part of the interview on The Crypto Show, Ver was asked whether he feels vindicated by the relative success of Bitcoin Cash, which differs from Bitcoin in that it has an eight megabyte block size limit and does not include the Segregated Witness improvement.
“I think it’s still really, really early for Bitcoin Cash,” responded Ver.
The early bitcoin investor stated that Bitcoin Cash has only been around for roughly three months, although it has become the third largest cryptocurrency in the world during that time (behind Ethereum’s ether). At the time of this writing, Bitcoin Cash’s market cap is around 16% the size of bitcoin’s.
“I can’t exactly say how soon it will happen, but I think it’s going to surpass [Bitcoin] here shortly as well,” added Ver.
In Ver’s view, Bitcoin Cash’s larger block size limit will allow it to better continue the success that Bitcoin had as payment mechanism in its early days.
“The reason that bitcoin was able to [increase in value over time] was because it had fast, cheap, reliable, censorship-resistant transactions for the entire world to participate on,” said Ver. “And [Bitcoin] no longer has those properties, but Bitcoin Cash does.”
Ver pointed out that fact that those who he has debated about the need for a larger block size limit on the Bitcoin network often do not have bitcoin wallets on their phones or use the cryptocurrency to transact on a regular basis. Indeed, there is a large contingent of bitcoin users who view the digital asset as more of a store of value than anything else at this point in time.
As reported by Forbes, preference for preserving bitcoin’s censorship-resistant, apolitical properties was seen with the recent failure of the hard-forking portion of the New York Agreement. It is thought that at least some supporters of the “2x” portion of the SegWit2x proposal that came out of the New York Agreement have now moved to Bitcoin Cash or Ethereum.
Ver indicated he is “very confident” that Bitcoin Cash will overtake Bitcoin in terms of market cap, price, user adoption, and other metrics multiple times throughout the interview. However, he added that some other cryptocurrency, such as ether, may end up taking the number one spot.
Although Ver claimed cryptocurrency investors should not put all of their eggs in one basket, he also claimed, “I hold the majority of my cryptocoin wealth in Bitcoin Cash at this point.”
The concept of ether overtaking bitcoin in market cap was popular over the summer, but the ether price has declined by roughly 70% against bitcoin since it’s peak in June.
Coinbase and Blockchain.info, which are perhaps the two most widely-used services in the cryptocurrency industry have both implemented the ability to hold and transact ether in their core products. Additionally, Coinbase has launched an entirely new product based on Ethereum, known as Toshi.
Much like Ver now has most of his cryptocurrency wealth in Bitcoin Cash, Coinbase CEO Brian Armstrong now holds more ether than he does bitcoin, according to Fortune.
Why Has the Bitcoin Price Continued to Go Up, Even with High Transaction Fees?
While there has been increased adoption of altcoins among companies building products and services in the cryptocurrency industry, the bitcoin price has still skyrocketed to new all-time highs in 2017. Although the number of transactions happening on the Bitcoin network has not increased in 2017, the value of those transactions as skyrocketed to $2 billion per day.
Some have said this would indicate bitcoin is fulfilling its promise as a sort of “digital gold”, but Ver does not agree with this theory.
“I think a lot of the people that are buying into bitcoin right now have been hearing about it in the news for years, and every time they hear about it, it’s at a higher price than before,” Ver told The Crypto Show. “And they’re buying it because they think, ‘Oh, this is a great investment; it’s going to go up some more.’”
Ver added that the bitcoin price could go much higher over the short term but the fundamentals are with Bitcoin Cash over the long term.
At one point, Ver discussed the possibility of a “death spiral” taking place on the Bitcoin network where transactions become increasingly expensive and unreliable as more miners move over to Bitcoin Cash.
A less-severe version of this scenario happened two weekends ago when an issue with Bitcoin Cash’s mining difficulty adjustment algorithm led to the altcoin being inflated at a rate faster than was originally designed. The increased number of coins being generated on the Bitcoin Cash network made it economically-wise for miners to abandon Bitcoin and join the alternative network. This had the side effect of massively decreasing the time between blocks on the Bitcoin network, which effectively decreased capacity.
During this time, the Bitcoin Cash price doubled and then returned back to where it started in a matter of hours.
This issue with Bitcoin Cash has since been fixed, but it’s unclear if sudden fluctuations in Bitcoin’s network hashrate may happen again due to the continued existence of Bitcoin Cash.