Now that Bitcoin Cash has been around for a while, the first statistics have come to light. An analysis by Chainalysis paints a pretty interesting picture for BCH. Most of the transaction volume comes from now coins. A lot of BCH is spent within six hours of being held. Not an ideal store of value by any means, although that isn’t surprising. Speculation is the driving factor for the current BCH price, that much is rather evident.
There are a lot of different opinions regarding Bitcoin Cash these days. Not everyone is in favor of this altcoin, for obvious reasons. Moreover, its value seems to be even more speculative than that of Bitcoin right now. That is one title no other cryptocurrency would like to have right now.Moreover, people don’t seem to like holding BCH for long. With most new coins being spent within six hours, it is not a store of value by any means. This begs the question as to what Bitcoin Cash is suited for exactly.
Bitcoin Cash is a Speculative Tool
At the same time, the daily transaction volume seems to be going up. There are some spikes and dips, but overall, there is steady growth. A positive development for an emerging altcoin. Chainalytics didn’t indicate what the coins are being spent on, though. Moving funds to and from exchanges appears to be the main purpose right now. This also explains why 70% of BCH have a limited coin age. One in five coins is less than a month old right now. Moreover, 80% of coins spent after the fork was acquired within six hours.
On the mining front, things are a bit different. While miners have been able to abuse the mining difficulty algorithm on demand, most miners tend to keep their coins. Around 45% of coins are still unspent, compared to 33% for Bitcoin. The positive effect is how it is difficult to sell Bitcoin Cash right now. However, if there is not enough demand, none of it really matters. Right now, demand comes from Bithumb, but that volume is drying up pretty quickly.
It is evident Bitcoin Cash still has a lot to prove at this stage. Day traders benefit the most from this altcoin. This will eventually lead to even more volatility, which isn’t necessarily good or bad. New coins brought in circulation will be spent pretty quickly. It will be interesting to see if the upcoming hard fork changes this procedure in any way. Until BCH is used for regular transactions, the majority of the volume relates to trading and mining. How this will affect the BCH price, remains to be determined.
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