Last month, prompted by his inability to raise the block size limit from 1MB to 2MB, Bitcoin Core developer, Mike Hearn, abandoned Bitcoin altogether and declared the cryptocurrency to be a failed experiment. The price of Bitcoin quickly fell from about $420 per coin to slightly above $360, and now has re-stabilized close to its original price before Hearn’s article.
CoinTelegraph spoke to representatives of several other cryptocurrencies to gauge if they had been affected by the challenges Bitcoin, the cryptocurrency standard bearer, has been facing and will face in the future.
Bitcoin and altcoin prices less correlated
According to Steven Saxton, developer of UK-based cryptocurrency, Sterlingcoin, it has not seen the price strictly follow that of Bitcoin.
“It does not seem to much based on my observations. In fact if you look at the history relative to Sterlingcoin’s lifespan thus far, you will see the yardstick that Sterlingcoin and all alternative currencies are measured by, Bitcoin, shrink and grow tremendously with volatility. While Sterlingcoin has maintained a much smoother and straighter line regardless that the yardstick can’t decide how long a yard should be.”
Temple Melville, Scotcoin’s majority holder, has also seen this trend against strict correlation to the price of Scotcoin and Bitcoin.
“If you had asked that question a year ago, I would have said there was a close correlation between the two. Now, I believe Scotcoin moves pretty much independently of BTC.”
Faith in Bitcoin remains strong
The likelihood of Bitcoin losing its #1 place among cryptocurrencies seems low to Oleg Khovayko, co-owner of Emercoin, that “...rather, there will be significant changes/improves [sic], etc… but, I think, Bitcoin will be alive and will be #1.”
Melville also does not think that the block size limit debate has driven many users away from Bitcoin.
“No I wouldn't say so. we have been aware of times when confirmations have been VERY delayed, but in general, if anything, our volume has been growing well without any issues.”
Increased interest in altcoins
Anthony di Iorio, co-founder of Ethereum, does not consider Bitcoin’s block size limit issues to be behind any recent growth, mainly because Ethereum serves an entirely different purpose and therefore would not see new users simply seeking a different form of cryptocurrency.
“I have seen more people get involved with Ethereum, but Ether isn't an altcoin, It’s the fuel that powers the Ethereum network and is needed in order to run the decentralized apps on Ethereum.”
Melville has noticed increased numbers of Scotcoins being traded, but is not sure if that can be attributed to Bitcoin’s volatility.
“Hard to say. If you look at the totals in terms of gross value of altcoins traded, the total has remained reasonably within a fairly small range day to day. We have certainly seen good growth in volumes of Scotcoin traded, but that may be due to other reasons - higher adoption in general for example.”
Saxton, however, holds a different view, that “somewhat bloated "governing" and lack of agility” can cause people to gravitate away from Bitcoin and toward altcoins.
“Currency needs the ability to flow and not resist flow. People will be less likely to use a currency that resists that flow. Be it the block size resistance or the slow block time and subsequent slow confirmation resistance. We are witness to an evolution right now. Yes Bitcoin will long stand as the grandfather of all crypto and respect and value will be given on that alone, as it should. But I do think it was just the next step on the evolution of money ladder.”
Finally, Saxton notes that other cryptocurrencies have already solved the issues that Bitcoin still faces today.
“Alt coins are nimble, and I don't mean small. Look how fast Dash responded to the same block size limit debate.”