What happened to Bitcoin Cash?
On 8th of April, the event known as halving occurred in the Bitcoin Cash network. In essence, starting from the block #630,000 the miner’s rewards were cut down in half, from 12.5 BCH to 6.25 BCH. It is an anti-inflation mechanism native to the Bitcoin network, from which the Bitcoin Cash diverged, or forked, in 2017.
Why is Bitcoin Cash Halving a big deal?
Many people treat BCH and upcoming BSV halvings as a rehearsal of the similar event that is projected to happen in the BTC network in late May of 2020. Historically, BTC halvings have been connected with a long-term rise in the value of the currency. In addition, lowered miner rewards shake up the mining industry by letting the opportunists take the place of those miners who chose to retire, thus creating healthy competition (in theory, at least).
What is happening with BCH now?
On the market
In terms of price, Roger Ver himself pointed out that it was like any other average day. While the first halving in the network, this has happened with BTC before, and long-timers insist that these events should not be hyped up too much and the most fun things are yet to happen within the next six months. Regardless, there was some hype, as the price has jumped from $250.19 to $277.65 within 8 hours on the day of halving (according to the data on CoinMarketCap). On the following days, though, there were no such sudden changes and the price continues to see a very slow but steady downward trend. It has to be said that these short-term changes are in no way indicative of what is to come next.
In the network
In the short-term, there were some difficulties in the network, as the first post-630,000 block took almost two hours to mine. This might have happened because of some miners shutting mining down as soon as the rewards were cut down. For such cases, the network has a difficulty-adjusting algorithm (sometimes abbreviated as DAA) in place, to make sure the blocks are more or less always mined every 10 minutes. Although it is much more probable that it was a temporary hiccup and the process has been picked up by the miners in a couple of hours, because just one block is not enough to give all the credit to the DAA.
With the miners
The miners are obviously the ones experiencing the immediate impact of this event. In one moment, their revenue was reduced in half, while the expenses didn’t. The hashrate was dropping while miners reduced their operations or switched to the more profitable at the moment BTC mining. However, the hashrate may have dropped but the blocks are still propagated and in the long run, theoretically, an increase in value of BCH might serve as an incentive for the miners to stay.
The block times, as a result, have been varying within an even wider range. While the network has not ground to a halt because of adjusting difficulty, the decrease in mining power could not leave the network unaffected. In the following summary, you can see that at the time of writing the BCH network got slower, but in general is propagating normally at about the same speed as BTC:
How did people react to Bitcoin Cash Halving?
This shouldn’t come as a surprise that the posts on social media that people were discussing the most were also the most expressive. There are generally two moods about it on Twitter and Reddit: either people spell doom to Bitcoin Cash or are stocking up on popcorn to see how everything is going to unfold.
Will the same thing happen to Bitcoin?
Not necessarily. If anything, Bitcoin Cash is likely to be more influenced by the Bitcoin halving rather than its own, experts say. After all, BCH is following BTC price trends quite consistently, and from the previous experience, the whole market, following the first cryptocurrency, is expected to experience a long-term bull-run. That is, on the premise that history repeats itself. We shouldn’t forget that the world in 2016 was much different from what we have now.
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