Bitcoin has lost $10 billion off its market cap following segwit2x’s cancellation, with the asset diving to $6,700, down from a brief all time high of $7,900.
That’s while its trading volumes have risen to $3.8 billion, with Bitfinex alone handling nearly half a billion. Closely followed by South Korea’s Bithumb at $340 million.
Now that segwit2x is off the table, with Erik Vorhees stating Bitcoin Core won, what Bitcoin Core developers are left are beginning to be more explicit with their plans to increase fees up and up.
Jameson Lopp, a vocal former big blocker turned vocal small blocker working as a developer at BitGo, stated: “The rise in transaction fees shall continue until SegWit adoption improves.”
In reply, Peter Todd, a very vocal small blocker, stated: “…at which point fees will continue to rise after a short pit stop. Let’s not oversell segwit; on-chain doesn’t scale.”
That suggests bitcoin has no plan to increase capacity, with the plan instead being what big blockers always said. Ever increasing on-chain fees to $100 or even $1,000 per on-chain transaction.
Instead of a peer-to-peer electronic cash system, bitcoin has now become a hard to move asset, with expensive fees, which lacks much utility, or use.
They are calling it digital gold, but while gold can be worn as decoration and given as a gift at no fee, easily movable in a peer to peer manner, with far higher privacy, bitcoin can take days to move, and the current fairly high fees are to increase a lot more, making it potentially more expensive than even transporting truckloads of gold.
The market clearly is unhappy. While it initially responded to the announcement of segwit2x’s cancellation with a price rise, potentially from clueless traders, it quickly retraced all gains, then dived further to $6,700.
Bitcoin Cash, on the other hand, is up 30% today. They plan to scale on-chain to as good as unlimited capacity through sharding. All while keeping fees sub-pennies, transactions moving as good as instantly, very much in a peer to peer manner, across the entire globe.
Although they do not call BCH digital gold, it naturally has the gold qualities due to its limited 21 million number. But it is much more than that. Unlike gold, or even cash, it can be spent on the internet, allowing you to buy whatever you please, with transactions confirmed in minutes.
Its fees are as good as non-existent. There is no friction at a protocol level. Its means of exchange quality, even economists would admit, is superb.
The plan for Bitcoin Cash is to create a virtuous cycle, whereby customers buy with BCH, merchants pay employees and suppliers with BCH, they in turn pay other merchants in BCH, and so on.
This would create a base underlying value and utility, which in turn would strengthen its store of value quality. The former would act as a floor, with the latter potentially naturally arising if BCH does grow to power some economy of sorts.