Bitcoin Cash (BCH) is one of the most controversial and divisive altcoins. It has split the Bitcoin community and stirred up a few heated online debates. One thing that isn’t controversial is the fact that price of Bitcoin Cash is quickly progressing. The BCH to USD price, while still as volatile as the other cryptocurrencies, is gaining stability, and its technology is being rapidly developed by some of the best blockchain thinkers.
So what can we expect for the price of Bitcoin Cash in the future? Bitcoin Cash already has a good foothold in the exciting crypto industry, but it also faces a lot of challenges and has some stiff competition. Here are some of the fundamental ways in which Bitcoin Cash is advancing and how they are likely to affect the BCH/USD price in the near future.
Usage is growing
Since August 2017, Bitcoin Cash has made great progress in many areas. Most importantly, the actual usage of the Bitcoin Cash network is up. The average number of transactions per second has been steadily increasing, especially in the second half of 2018. This happened while transactions on the Bitcoin (BTC) network remained relatively constant. That means many more people are using Bitcoin Cash. This is very important, as one of the key selling points of BCH is its scalability and usability as a payment network. The usage rate is still below BTC, but it’s growing much faster, too.
Price of bitcoin cash stability
The ‘Cash’ in the name of Bitcoin Cash is a hint that the BCH network is built primarily to be an easy and fast medium of exchange. One key property any medium of exchange needs is a relatively stable value. Bitcoin Cash hasn’t got there yet, but the BCH price chart is showing signs of growing maturity and stability. As the Bitcoin Cash market settles down, its value as a medium of exchange will increase, so its value against the US dollar will grow as well.
Bitcoin Cash is also staying on the front foot in terms of technological innovation. While the Bitcoin network seems to be constantly on the back foot in terms of upgrades and scalability innovations, Bitcoin Cash is making upgrades now for the future. Even though it wasn’t using anywhere near the 8MB capacity it had, the network underwent a successful upgrade to increase the block size to 32MB. Many businesses would call this ‘future proofing’ that shows the community and developers are preparing for the long-term growth of the network.
Coexisting with Bitcoin
It’s tempting to buy into the Bitcoin vs Bitcoin Cash debate and think that cryptocurrencies are a zero-sum game, with one currency inevitably consuming the others. But, Bitcoin Cash may be finding a way to coexist with Bitcoin. Bitcoin Cash achieves greater scalability and transaction volume, but many argue that this is achieved by accepting a greater risk of centralization. If Bitcoin Cash can attain its goals of becoming a fast and cheap medium of exchange, it could take up a role of being the go-to network for smaller transactions. On the other hand, Bitcoin can remain a more decentralized store of value, kind of “digital gold”.
Bitcoin Cash already faces competition in this sort of role from altcoins like Litecoin, but if it can carve itself out a niche in the industry, it could easily maintain its growth alongside Bitcoin and other cryptocurrencies, pushing the BCH/USD price up in the long term.
Unfortunately for Bitcoin Cash and its users, progress in a competitive market always comes with new challenges. Price of Bitcoin Cash is facing, or could face, a few difficult speed bumps right now and in the very near future.
Bitcoin core aggression
Many Bitcoin Core supporters see Bitcoin Cash as a direct threat to their network and investments. The infighting between the two communities has heated up to damaging levels, with both sides using shady tactics to try to gain an edge in the debate. As it stands, Bitcoin Core has dominance over the cryptocurrency market and, importantly, has control over the brand “Bitcoin”. This makes it a formidable opponent, and the fight could easily go sour for Bitcoin Cash. If it did, you can be sure the BCH/USD price will drop.
Demand isn’t keeping up
Despite all of the achievements of Bitcoin Cash, demand just isn’t keeping up with the scalability advancements the network is delivering. This has humorously been compared to expanding a highway, even though nobody is using it. In fact, Bitcoin Cash uses well under 1% of the transaction capacity it can actually support, and some exchanges have even withdrawn support for Bitcoin Cash due to lack of transaction volume. You could see this as a good thing as there is room to grow, but a payment processing network needs a lot of usages to stay on track.
Apart from genuine utility as a payment network, another crucial factor affecting Bitcoin Cash’s price against the US dollar is investor confidence in the future viability of the network. Bitcoin Cash is advancing, but it’s advancing in a still extremely risky and uncertain industry.
A lot of speculation is already built into the price of Bitcoin Cash (as with most cryptocurrencies). This speculation is based on the expectation that the value of cryptocurrencies will go up in the future. Anything that shakes that expectation can quickly send the price of any cryptocurrency downwards.
Ethereum and many of the other altcoins have characteristics that make them very different from Bitcoin and attach completely new use cases. Bitcoin Cash has the unique position as the most direct competitor to Bitcoin. If BTC can outpace BCH in terms of investor confidence, the money will flow from BCH into BTC, pushing the BCH/USD price downward. This could be something like the successful implementation of the Bitcoin Lightning Network. If the Bitcoin Core network was able to solve its scalability issues, Bitcoin Cash would lose its main marketing point and a lot of its allure.
Confident but not complacent
Bitcoin Cash is making major progress in key areas that are boosting the value and stability of BCH/USD. Community and technological developments are boosting the underlying value of the altcoin. But, BCH, like all cryptocurrencies, still faces many hurdles in the near future. Managing competition with Bitcoin and keeping up demand and investor confidence will be pivotal to the future of the network.