Bitcoin Cash bounces after 14% tumble
Prices of bitcoin and Bitcoin Cash rebounded on Tuesday, while ethereum remained under pressure, further retreating from recent all-time highs.
A single bitcoin BTCUSD, +0.23% was most recently up 2% on the day at $4,139.87, after dropping to as low as $3,687 in morning trade. At the session lows, the virtual currency had briefly been pushed into correction territory, defined by technical analysts as a 10% or greater fall from a recent peak in an asset.
Bitcoin hit as low as $3,687 earlier on the day, which would represent a 16.7% decline from its mid-August record close above $4,425, according to virtual-currency site Coindesk.com. At current levels it is 8% below that peak.
Even after the stumbles, bitcoin’s price is about 400% higher since the start of the year, with a market cap at $68.7 billion, according to digital-currency research site Coinmarketcap.com.
Meanwhile, ethereum’s ether token retreated, coming off a recent record, down 0.5% at $322.33 on the day. It reached a peak in mid-June at about $380 a token.
Some industry experts played down the digital-currency slide.
“Naturally some of the prices and exuberance seen in the price are causing traders to take profits,” said Charles Hayter, chief executive and founder of CryptoCompare.
The moves for bitcoin come as the industry has tackled so-called scaling issues, which are intended to increase transaction sizes in the blockchain network. Traditional bitcoin participants have coalesced around a new protocol known as Segregated Witness, or SegWit., which solves bitcoin’s scaling issue.
“With SegWit implementation it has perhaps been a question of buy the rumor, sell the news,” said Hayter, referring to the industry’s recent trading in the wake of upgrades to the bitcoin network.
Meanwhile, bitcoin’s offspring Bitcoin Cash, which tumbled 14% on Monday, rebounded on Tuesday, trading 5.2% higher on the day at $662.25.
The fallout of bitcoin’s transaction-size problem was the creation of Bitcoin Cash.
Bitcoin Cash, the nascent alternative to bitcoin, had climbed to a recent peak of $920 on Saturday. At current prices, its market capitalization is above $11 billion, making it the third-most valuable virtual currency, behind cyberunits running on the ethereum blockchain.
Like bitcoin, ethereum went through a fissure last year that resulted in ethereum and ethereum classic, which emerged after ethereum’s developers engineered a controversial software update that rolled back part of its blockchain in an attempt to recover stolen funds, which led to a segment of investors refusing to adopt the update.
“Ethereum and ethereum classic have coexisted — the fanaticism of [Bitcoin Cash] as a fringe idea will most likely influence bitcoin, but as with most splits left of field plays, it will not reach mainstream, just like politics,” said Hayter. “That said, if bitcoin manages to fracture its community through infighting, there could be a chink in its armor.”
So-called ethereum classic is worth only a fraction of its updated brethren, with a market value at $1.3 billion, compared with ethereum at nearly $30 billion. Ethereum appreciated nearly 70% since the start of August and is up 3,875% year to date, having started 2017 at about $8.
The total market value of an array of widely followed digital currencies was at $147.49 billion.
via marketwatch
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