Bitcoin (BTC) Value Reaches 2018 Low as Crypto Speculators Attribute BCH Hash Wars to Cause
The BTC is spiraling to a new low in 2018, effectively dragging down the crypto market down with it. Many analysts and investors are becoming interested in what could be causing it to drop so drastically. Attributing the drop to the lack of buying volume and growing selling pressure is not enough to explain this price drop.
Current BTC Prices
BTC is trading at about $3800 right now. This is a recovery from this weekend when it fell to $3500. Following the sharp drop, it shot to $4100 before dropping to $3,600 a short while later.
The $3,600 area may prove to be the new level for BTC, which bounced back to hit this level. Whether or not this minor bounce fizzles, it will prove whether this is the new support level for BTC.
The huge drop on BTC has had a major impact on the crypto market. Many altcoins have hit new lows for 2018 due to this. This includes BCH, which is trading at $180 and ETH, which is trading at $109. This is slightly higher than its low of $100 for 2018.
What Is Causing The Drop?
The 2018 dip has gone beyond the boom and bust cycle of the market. It rivals any previous drops that occurred due to market events such as the 2014 Mt. Gox attack. The possible reasons might be the falling BTC hash rate and BCH hash war, which has split the crypto world into two major camps.
BCH recently underwent a hard fork that split the crypto into BCHSV and BCHABC. Crag Wright, often called the Fake Satoshi, backs the SV. The ABC version is backed by major organizations, which include Bitmain, the Chinese crypto mining giant.
This hard fork led to a split in the crypto world that has led to money leaving BCHABC and caused many investors to lose a lot of money. As a result, it might have caused the investor morale and sentiment to turn negatively against crypto.
Another factor may be the falling BTC hash rate. The hash rate is a result of the number of miners offering computing power for verification of transactions. However, the bear market has seen the number of contributors drop. There are rumors that China-based mining groups have begun dismantling and selling their rigs for scrap. This is because it has proved unprofitable to continue mining with the falling prices.
What The Experts Think
The CEO of Crypto Compare Charles Hayter recently spoke of the issue in an interview. He said that BTC prices had been directly proportional to the hash rate. Right now, the hash rate is falling and the price is falling too. The hash rate indicates the capital costs and expenses people are ready to use to generate BTC and give it its price.
What To Remember
Despite this, investors need to remember that there are events in 2019 that could turn things around. For instance, the SEC ruling on VanEck/SolidX Bitcoin ETF at the start of 2019 and the launch on Bakkt could change fortunes for all.