Bitcoin Cash Price Surpassed $700: Driving Forces
The price of the digital currency Bitcoin Cash sustained its upward trajectory and surpassed the $700 mark on Aug. 18.
Heading into the weekend trading sessions, the cryptocurrency posted a more than twofold increase in its price and emerged as the third-biggest digital currency in terms of network value.
The positive developments being seen in the performance of Bitcoin Cash form part of the digital currency’s brief history that started when it split off from the main Bitcoin Blockchain in early August.
Bitcoin’s split was realized when a group of miners and developers adopted a software with new network rules that were not compatible with the cryptocurrency.
While Bitcoin continued to experience exceptional performance after the split in which it posted record highs of more than $4,000, Bitcoin Cash remained largely stagnant in its early weeks of existence.
However, the latter experienced a sudden surge during mid-August trading to reach about $750 per token.
Possible reasons for the price surge
There are several possible factors behind the sudden increase in Bitcoin Cash’s price, but it is still uncertain if these drivers will continue propelling the digital currency’s value upwards in the future.
Among the key drivers behind Bitcoin Cash’s upward trajectory are:
- Miners mechanics - The decreasing mining difficulty of the Bitcoin Cash network is attracting a growing number of miners as their earnings will be higher due to the expected increase in the number of tokens that they will produce. During the split with Bitcoin, the mining of Bitcoin Cash has been very hard due to the messy mechanics of the split. With the recent increase in the digital currency’s price and the expected sharp reduction in mining difficulty, it is anticipated that the number of Bitcoin Cash miners will increase further.
- New exchange volume - There are signs that a growing number of digital currency exchanges are adopting Bitcoin Cash in their platforms. One case in point is the trading of around $1.2 bln worth of the digital currency in three South Korean exchanges alone in mid-August, namely, Bithumb, Coinone and Korbit.
- Faster processing - CNBC reports that Bitcoin Cash faster processing is what likely caused 40 percent of investors increasing their bet on it.