What Just Happened in the World of Cryptocurrency This Weekend.
What Just Happened in the World of Cryptocurrency This Weekend ? It was just one of those weekends in the world of cryptocurrency. You know what I’m talking about. Bitcoin and Bitcoin Cash have been sparring in an epic battle; crypto investors are waking up this Monday morning, scratching their heads, and thinking: did that really just happen?
The answer is yes, that did just happen. Let’s review: the cancelled fork of last week that caused the end of the rally that was driving Bitcoin to unprecedented heights last week led to widespread confusion and an exodus from Bitcoin into Bitcoin Cash. Bitcoin fell as Bitcoin Cash soared; Bitcoin stabilized as Bitcoin Cash took a nosedive. Now, it’s a bit unclear which coin is the ‘real’ Bitcoin.
The price of Bitcoin reached a new all-time high last week, breaking through US$7000 in anticipation of the controversial SegWit2x fork, which was eventually called off. The rally was all par for the course. Because BTC holders receive an additional amount of the new coin created during the fork equivalent to the amount of their BTC, many users will buy up more BTC before a fork takes place, driving the price of BTC up.
However, the fork was cancelled. SegWit2x was perhaps the most disputed fork in the Bitcoin community yet. On the one hand were its creators and supporters who had conceptualized the fork as part of something called the ‘New York Agreement’, which was backed by fifty-eight companies spread across twenty-two countries.
On the other hand were the Bitcoin Core Developers, who rallied against SegWit2x. They argued that the fork was poorly constructed, and that (among other issues) its lack of ‘replay protection’ could cause a rash of duplicate transactions. “Concerns raised by Bitcoin Core contributors and Bitcoin community members about the Segwit2x proposal have not been adequately addressed by its proponents,” they said in a statement preceding the cancellation of the fork.
SegWit2x was the latest in a series of BIPs (Bitcoin Improvement Proposals) that would solve Bitcoin’s scalability issue. The Bitcoin network is only capable of one megabyte’s worth of data every ten minutes, which translates to roughly seven transactions per second. As the network becomes increasingly popular, the pressure on the limited capacity for processing transactions continues to build.
Just this weekend, a glut of transactions on Bitcoin’s network caused a massive ‘clogging’; some transactions reportedly took up to 72 hours to be confirmed and cost as much as US$100. The popular Exodus wallet even made the decision to temporarily disable Bitcoin transactions until the trading volume returned to normal.