Bitcoin Tumbles By 12 Percent As Bitcoin Cash Hash War Spooks Investors
The price of bitcoin broke away from its “stablecoin mark” in the mid-6,000s and dropped by over twelve percent as a result of the bitcoin cash (BCH) hash war that has spooked investors and highlighted how fragile and volatile the digital currency sector still is.
On Thursday, the bitcoin cash (BCH) network split into two after disagreements among critical stakeholders of the BCH community. Now, there is the BCH Bitcoin ABC chain and the BCH Bitcoin SV chain, both of which are being mined. While the Bitcoin ABC side, backed by Roger Ver, Bitmain and the majority of the community, is “ahead” in the hash war, according to data by Coin.Dance, Bitcoin SV’s figure heard, Craig S. Wright, has announced that the hash war is not a sprint but a marathon and, thus, will likely continue for several more weeks.
This will likely continue to drive uncertainty in the cryptoasset markets, overall, and will continue to affect bitcoin (BTC) as hash power has been moved from securing the Bitcoin network to “fighting” the BCH hash war.
Week-on-week, the price of bitcoin cash (BCH), which – as it stands – refers to the Bitcoin ABC fork, has dropped by a whopping 30 percent. As the hash war continues, BCH has the potential to suffer further.
As a result of the steep price drop in bitcoin, the altcoin market is mainly in dark red territory. ETH is down by 17 percent, EOS is down 15 percent, and LTC is down 18 percent. Only XRP bucks the trend and closes the week slightly in the green as Ripple continues to increase adoption among banks.
On a positive note for bitcoin, Switzerland approved its first cryptocurrency exchange-traded financial product, and the Lightning Network is growing, which helped to steady the digital currencies price towards the end of the week.
This week’s contributions have been provided by Alex Lielacher, Aisshwarya Tiwari, Pratik Makadiya, and Priyeshu Garg.
The two teams, Bitcoin ABC and Bitcoin SV, led by Bitcoin Cash proponent Roger Ver and CoinGeek CEO Calvin Ayre respectively, are engaged in a fierce battle of hashpower to ensure their protocols make the cut.
Data suggests Bitcoin SV miners control a staggering 76 percent of the network’s current mining power, with backers such as Craig Wright, the self-proclaimed Satoshi Nakamoto, stating a hard fork and the creation of a new cryptocurrency is a possible outcome.
While a new Bitcoin Cash currency may require a majority of the hashing computers to update their software, the ABC network enjoys high-profile mining pools such as BTC.com, Bitcoin.com, and AntPool that actively support the network and ensure SV’s efforts are usurped. Still, Wright continues to bash the collective on Twitter and has even vowed to destroy the ABC network.
Ayre’s CoinGeek mining pools are steadily increasing their hashpower dominance, jumping from 30.6 percent of the network in the start of November 2018 to 41 percent on November 13, 2018. The move has caused okMiner and Mempool to lose a substantial portion of the hashpower they enjoyed previously, falling from 7.6 percent and 6.25 percent respectively to 3.47 percent
Influential Bitcoin ABC mining pools are seeing their dominance increase gradually too. Bitmain-owned AntPool and BTC.com now control 4.86 and 6.25 percent of the network, up from 2.78 percent previously.
On November 14, 2018, the International Monetary Fund’s (IMF) Managing Director Christine Lagarde is of the opinion that governments and central banks should look into issuing state-backed digital currencies, witnessing the global shift to cashless economies. Although, IMF chief stated that a public-private partnership could best achieve such innovation.
Speaking at the Singapore Fintech Conference, IMF Chairwoman Lagarde backed the idea of a central bank issued digital currencies (CBDCs), citing the decline in used of cash and cash-based transactions.
“I believe we should consider the possibility to issue digital currency. There may be a role for the state to supply money to the digital economy,” said Lagarde.
At present, the digital economy is entirely reliant on the private financial sector, giving the very few private payment providers abundance power. If more people switched to digital money than would significantly devalue the existing cash infrastructure. Therefore IMF head believes that introducing CBDCs is one way central banks can gain footing in the payments market.
German holding company Bitcoin Group SE has acquired a 100 percent stake in investment bank Tremmel Wertpapierhandelsbank GmbH, the company announced in a press release on November 13, 2018.
Bitcoin Group SE has reached an important milestone in the expansion of its service portfolio and acquired 100% of the shares in Tremmel Wertpapierhandelsbank GmbH. According to the company’s press release, the acquisition was announced on November 13, 2018, and will significantly expand the range of services offered by Bitcoin Group SE.
The group currently operates Bitcoin Deutschland AG, also referred to by its domain, Bitcoin.de, the only regulated trading platform for digital currencies in Germany, which lists Bitcoin, Bitcoin Cash, and Ethereum. The company also owns a 50% holding in Sineus Financial Services GmbH, a financial services provider supervised by BaFin.
This acquisition will enable the company to use Tremmel’s banking license, allowing Bitcoin Group SE to issue its products in connection with cryptocurrencies, conduct proprietary trading in cryptocurrencies and operate ATMs for cryptocurrencies.
According to a report by Bloomberg, published November 13, 2018, U.S. resident named Joseph Kim has been fined $1.1 million and sentenced to 15 months in prison for orchestrating fraudulent schemes related to bitcoin (BTC), and litecoin (LTC), thus duping his employer and several other customers of their money.
In 2017, the U.S. Commodity Futures Trading Commission (CFTC) found out that Kim had transferred $601,000 worth of bitcoin and litecoin from his employer’s cryptocurrency exchange wallet to his wallet. The misappropriation of funds was done sometime between September and November 2017, when Kim used to work for a Chicago based trading firm.
In an attempt to better his sorry situation, Kim started to solicit funds from individual investors stating that he had left his previous job to start his trading venture. Kim was successful in accumulating close to $45,000 from five investors who he had tricked into the fraudulent scheme. However, he lost all $45,000 as a result of poor trading decisions. To hide the losses, Kim even managed to forge the account statements sent periodically to investors to show them profits.
His luck ran out for Kim when he got slapped with $1,146,000 fine by the U.S. CFTC. Also, the CFTC also permanently banned Kim from participating in crypto trading, and from soliciting funds.
According to 1ML.com, a search engine dedicated solely to Lightning Network metrics, the second layer, off-chain scaling solution for bitcoin has reached a new milestone, as it passed 4000 nodes for the first time at press time, November 14, 2018.
Bitcoin’s second layer solution created to enable rapid and affordable payment, Lightning Network has taken the cryptocurrency sector by storm in a short period. At press time, the mainnet network capacity was close to 123.22 BTC (approx. $714,407), with a total of 11,909 channels.
Lightning Network differs from the Bitcoin network in that, not every bitcoin transaction is required to be recorded in the case of the former. Lightning Network involves nodes which operate on the network to facilitate the transfer of bitcoin among them. The network is constructed from building blocks referred to as payment channels.
It trumps the Bitcoin network regarding speed, efficiency, and scalability. The Lightning Network only logs the opening and closing balance of transactions until one of the participating nodes voluntarily close the channel.
Once the channel is closed, the blockchain only records the final state or the closing balance. Consequently, this saves a large amount of data from getting stored in the main blockchain and wasting the data space on the digital ledger.
Blockchain startup Coinmine has announced the launch of its innovative new cryptocurrency mining device. The device is a combination of hardware and software, which is designed to bring ease of use to digital currency mining so that anyone can mine crypto from home.
The Los Angeles-based startup has revealed in a press release that its first device, called the Coinmine One, is ready to go to market. Coinmine has been in existence for several years and has succeeded in attracting the attention of some notable names in the cryptocurrency community.
Coinmine’s first device is called the Coinmine One, which can now be pre-ordered for $799. The contraption makes it incredibly easy to mine the supported cryptocurrencies. To begin mining digital currency, users just the device to an energy source and consequently interface with the device through a mobile application.
The combination of ease of use, relatively low costs, as well as the removal of the need for large spaces to hold the mining rigs turn a frequently complicated undertaking into a user-friendly simple plug-and-play operation.