Fork effect on bitcoin price

But not for the reason you think… Collective fear is not the prime driver behind the plunge, the cold-blooded premeditation is. Whales, investors capable of moving the market with enormous trades, bring the Bitcoin market down.

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The last two emerged through the process known as hard fork, when the original blockchain is split in two. While Bitcoin Cash was trying to solve the problem of low transaction speed, Bitcoin Gold is aimed at miners. BTG developers want to make mining easier, decentralize the network even further and open up to a wider audience. While the first hard fork in the history of Bitcoin took place in July, the second one happened on October 24 th.

Bitcoin's Forks Have Trounced Bitcoin This Year - CoinDesk

In both cases lack of community support is the main reason behind the weak price action. As mentioned above, hard forks also influence the price of the original blockchain, which is Bitcoin.

Both times the cryptocurrency has depreciated in the days following the fork. The involvement of the so-called whales is believed to be the prime factor and here is why. Suchlike behavior can easily be explained by technical peculiarities of the hard fork. After the split, holders of the original cryptocurrency get an equal number of newly created coins, which can later be sold for an additional profit. A lot of investors, therefore, want to lay their hands on Bitcoin right before the split.

The buying pressure, sustained by an upcoming opportunity to capitalize on the post-fork altcoin, drives the price of BTC up. They, therefore, are being dumped almost instantly and depreciate in price rapidly due to the sell-off. It applies to Bitcoin Cash and Bitcoin Gold. Demand for Bitcoin, artificially pumped by speculators before the split, goes down as opportunities associated with the hard fork diminish.

Presumably, due to whales.

Bitcoin forks are creating new currency as fast as traders can snap them up

Many investors have accumulated impressive positions in Bitcoin before the most recent fork in order to reap massive capital gains. Due to their coordinated activities, the BTC price action first demonstrated first an increase and then a plunge. NOTE: This article is not an investment advice. Any references to historical price movements or levels is informational and based on external analysis and we do not warranty that any such movements or levels are likely to reoccur in the future. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

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How Another Fork Affects the Bitcoin Price

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The first hard fork splitting bitcoin happened on 1 August , resulting in the creation of Bitcoin Cash.

What the Fork? Why Bitcoin Tech Changes Impact Price

From Wikipedia, the free encyclopedia. Wikipedia list article.

Main article: Fork blockchain. Retrieved 17 June Mastering Bitcoin: Programming the Open Blockchain 2 ed. USA: O' Reilly media, inc. ISBN The New Yorker.

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Conde Naste. Retrieved 7 January Retrieved 20 August PC World. Retrieved 5 January Archived from the original on Retrieved April 28, Retrieved 23 April History Economics Legal status. Money portal. List of bitcoin companies List of bitcoin forks List of bitcoin organizations List of people in blockchain technology.