Bitcoin drops to 13-month low as Bitcoin Cash split stokes uncertainty

The original cryptocurrency, Bitcoin, slumped to its lowest level in 13 months on Monday as uncertainty around a hard fork in Bitcoin Cash sent the digital currency sliding.

In lunchtime trading, Bitcoin’s price was around US$5,236, down 5.4% on the last close and 17% lower than this time last week.

The lower price has driven the total market cap of Bitcoin below US$100bn for the first time since the Bitcoin ‘bubble’ at the end of 2017, which saw its value increase exponentially on a wave of speculation to around US$17,000 by mid-December before crashing back to around US$7,820 in early February before entering a slower decline.

The plunge began last Thursday as the market was hit by uncertainty regarding a so-called ‘hard fork’ in Bitcoin Cash into tow new currencies, Bitcoin ABC and Bitcoin SV.

A ‘hard fork’ is a radical change to the protocol of a blockchain system that makes previously invalid blocks/transactions valid or invalid, essentially a permanent divergence from previous versions of the blockchain.

Bitcoin Cash itself is the result of a hard fork from the original Bitcoin blockchain last year, which stemmed from disagreements on how to scale the asset.

The latest split has raised concerns that cryptocurrency miners will divert their processing power towards the new currencies and away from Bitcoin.

Story by ProactiveInvestors