At the beginning of August, the same mining company that created Bitcoin, has decided to cope with the speed of transaction process by creating a new cryptocurrency, the Bitcoin Cash. While Bitcoin has continued to rally, the Bitcoin Cash has suffered the first hacker attack for lack of security.
Cryptocurrencies are the asset of the moment and in recent weeks their performance has been better than many other assets in circulation.
Bitcoin is getting amazing results even if it was the first cryptocurrency created and released on the financial market.
Bitcoin’s price has just broken the level of $3.000 and it is approaching to $3.500. This is a new record since the cryptocurrency has almost quadrupled its value compared to the beginning of the year.
With a new historical record, its market capitalization exceeded $54 billion. The percentage points earned in the first week of August are about 15.
Such a large business round is synonymous with greater acceptance of Bitcoin and hence also of a growing legal recognition.
All this happened at the beginning of August, when traders were worried about the worst, which was the fracture of the cryptocurrency for the birth of Bitcoin Cash.
According to some, the recent Bitcoin rally was determined by the post-splitting relief. In fact, ‘original’ Bitcoin was able to touch even $3.486, without being affected by early August changes.
By consolidating Bitcoin’s position despite the split, other investors have decided to target the Bitcoin driving up its price.
According to others, Bitcoin can even reach $10.000, noting how its performance have been amazing despite the fact that investors were still a few.
Why did the miners’ company decide to take the risk and create a new Bitcoin entity?
The problem is to reconnect to the speed of the processed transactions. Bitcoin is a cryptography that exists within a computer network, through the blockchain that makes it harder to manipulate logs because the accuracy of what is happening is verified by the majority rule and not by a single one.
All this technology is slow if you think about how banks handle credit card transactions (for example Visa manages 150 million transactions per day).
Possible transactions within the Bitcoin network are only 7 per second and of course, as the network grows, the timing is getting even longer because there are more transactions to be processed.
With the need to increase the speed of the transaction process, miners have voted to incorporate a technology known as SegWit2x which should be effective by the end of this month.
Bitcoin Vs. Bitcoin Cash
On August 1, however, some miners and developers started an operation that actually created a new currency: the Bitcoin Cash. Bitcoin Cash has effectively overcome the problem of the speed of processed transactions, but this caused some concerns for the security of the Bitcoin Cash.
In fact, while Bitcoin was approaching $3.500, Bitcoin Cash has already suffered a first hacker attack.
It is certain that like for other cryptocurrencies, Bitcoin Cash will take time to settle down and it will take a long time to discuss about its true course.
We need to wait until Bitcoin will implement its new technology at the end of August and see if the results will be really satisfactory in terms of transaction speeds. If developers succeed in keeping the security level of new cryptocurrencies high, their credibility will surely rise.
Bitcoin: Last Minute Backstory