Bitcoin Cash Rallies Ahead of Halving
Summary
- Bitcoin Cash rallies over 12% before the highly anticipated halving event
- Halving will reduce block reward to 6.5 BCH per block
Bitcoin Cash is the most popular Bitcoin fork. Bitcoin Cash features several modified parameters such as an increased block size (to process more transactions at a time) and a different difficulty adjusting algorithm to accommodate for large fluctuation in miners. As a result, Bitcoin Cash offers better scalability than Bitcoin.
Bitcoin Cash’s fork will occur in a few short hours. BCH is currently trading at $275, reaching a high of $280 minutes earlier. There is strong resistance at the $280 level, however, the halving may prove as a catalyst to push through this resistance.
Pricing in the Halving
A halving occurs when the block reward halves (learn about block rewards). As a result, the emission is halved, thus making the cryptocurrency rarer than it was prior to the fork. This may result in price fluctuations for two reasons.
A cryptocurrency halving can cause a price increase for numerous reasons. Post halving a cryptocurrency becomes far rarer and thus, according to supply and demand, if the supply decreases while the demand is the same, the price will go up. As a result, many traders pump the price of a currency prior to halvings in the hope that the price will continue to go higher. In the current situation, Bitcoin Cash rallies ahead of halving
However, on the flip side, the price can crash following a halving as many traders pump the price on pure speculation. As a result, many traders end up losing money.
Note: This post is being updated throughout the event
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