The Bitcoin split has happened, and despite all the naysayers and doomsday folk, everything seems to be fine. People who kept up the tradition of holding and not selling were rewarded with their digital currency remaining intact, and for those adventurous enough to split off, there’s a whole new system to invest in as well. While people will continue to freak out about Bitcoin every time prices plummet or skyrocket, or there’s more tech lingo released that makes dinosaur financial sites scared, the clear path has and always will remain to be to keep calm and believe in the value of cryptocurrency.
So What Happened?
I outlined in a previous blog why and how the Bitcoin community was splitting, but I will give a quick recap here anyway. Essentially, the existing software that Bitcoin had caused transactions to be slow and bogged down as more people started using the currency, which was an intentional design feature by the creators to add legitimacy to the platform. Now that Bitcoin has become a more legitimized form of currency around the world, the slow transaction times were essentially killing the prospects of new people joining the system. The compromise then was to upgrade the system, and the split happened based off of how the upgrades would go down. One side wanted to double the speeds and move transactions to a different system, while the other side wanted to keep transactions within the existing Bitcoin software but increase speeds to eight times as fast. Instead of compromising on this decision, a new form of Bitcoin has instead emerged called Bitcoin Cash (ABC), and anyone who currently had standard Bitcoin (BTC) retained their current worth and value.
What Does This Mean?
For people who invest in cryptocurrency, this is actually a fairly solid outcome, as not only did Bitcoin hold its value, but there is now a whole new cryptocurrency for people to try and invest and trade in. After only being less than a day old, Bitcoin Cash has climbed to number four in cryptocurrency value, which is what makes people who call cryptocurrencies “fake money” seem even more behind the curve. As of now, Bitcoin has held its $2,700 price point, and Bitcoin Cash is at about $600, but will only climb as investors transition assets from one platform to the other. People who have been skeptical of both cryptocurrencies and the split all thought that this dispute would lead to a massive crash in the value of Bitcoin. Instead, go figure, Bitcoin’s value was in its software and functionality, and thus still holds all of its value. While for some this result may feel lackluster, hoping that there was going to be a big collapse or boom, I feel both satisfied and justified that things are maintaining just as I predicted.
So What Now?
Now that the dust is settling, it’s easy to feel lost in the crazy world of digital currencies. The reassuring thing is that this split was built up to be the most cataclysmic event in cryptocurrency history, and instead it turned out to just be par for the course natural evolution. If anything, this event just shows the toxic nature of journalism in relation to technology and investing, and even more so shows people’s lack of knowledge in digital currency affecting mood and opinion. The remarkable thing is that the lack of a crash after the split is purely based off of everybody who has bought into the system maintaining their faith and not trying to sell off all the assets they’ve maintained. It’s this faith that keeps Bitcoin a viable currency and ensures that its value only increases year after year. It’s also this faith that leads libertarian idealists like tech millionaire John McAfee to make rather high stake bets that Bitcoin will soar to unfathomable heights within the next five years. As of right now, if you haven’t gotten on the Bitcoin train, now is the perfect time. Start researching wallets, start researching safety and returns, and start researching all of the amazing things this platform can do. Be aware that services like Coinbase will not be supporting the new Bitcoin Cash, while other services might exclusively support that format. Do your research, but trust me, people who hesitated years ago are kicking themselves for not getting in earlier. Now, more than ever, is a great time to join an ever-growing and ever-improving community of people who want to take control of the way we trade with one another, a feat only possible in the modern day with the technology we possess. To anyone who joins in the cryptocurrency family after this news, welcome. To the naysayers stuck in the Stone Age, actually educate yourself on what Bitcoin is. I’d like to remind you what happened the last time you all put your faith in the economic elite and financial media. Last I remember it didn’t turn out that great.