“What … we’ve got here is… failure … to communicate.” – the Captain, Cool Hand Luke
Traders looking through the wreckage of yesterday’s cryptocurrency crash will find some experts laying it all at the feet of the Bitcoin Cash hard fork.
Reporting at Cointelegraph, neatly illustrated with Isaac Newton looking quizzically at a fallen coin, notes a total $27 billion devaluation of the crypto market in just one day, which is enough to send shivers down any crypto enthusiast’s spine.
Then there are the rationales. Directly after the fall, CNBC quoted Brian Kelly this way:
“When you do a software upgrade, everybody usually agrees. But in this particular case, everybody is not agreeing … so, we’ve got ourselves a ‘crypto civil war … people started selling. That triggered stops. Everybody got concerned. And that’s what happened today — the entire market sell-down.”
Now, the first invalid block has been mined by SVPool, and we’re off to the races. As of press time, ABC is ahead of SV in terms of hash rate and number of blocks mined.
To be clear, not everybody is suggesting that Bitcoin and other coins tanked because of Bitcoin Cash. Various corners of the commentariat cite poor market conditions and suggest that now is not a great time to re-up in crypto.
However, there’s something very interesting in play here.
If – and it’s a big if – the crash was mostly to do with consternation over BCH, well then, within a week or so all of those issues will be concretely addressed. One or the other tines of the hard fork will have won out, and in all likelihood, the markets will be more or less back to normal.
So if you can blame Bitcoin Cash for most of the crunch, it’s almost the definition of “buy on the dip and get rich” – for instance, if Bitcoin rises back to $6,500 within a week, then traders using this strategy would get, theoretically, a 10% gain in a week. Not to belabor the point, but if you got 10% every week, you’d have a 520% gain at the end of the year.
It’s really an unknown – but in contemplating whether to establish your first core position in crypto, you can add this common sense factor in when you look at Fibonacci retracement and everything else. Any play is a gamble – a speculation that at some future point crypto or a particular coin will be up. So there is significant fodder for the suggestion that when things get worked out on Bitcoin Cash, parts of the crypto market will rebound.
Watch these important prices today as Bitcoin stays around $5,500, BCH remains over $400, and Ethereum stays down below $180.