The Hashwar: The Block Gap Starts To Close
Now that November 15th has passed, all eyes have been glued to Crypto Twitter and websites regarding the Bitcoin Cash contentious hard fork/network upgrade, as it has yet to be determined whether Roger Ver, Jihan Wu, and their compatriots (Bitcoin ABC) have ousted Craig Wright and Craig Ayre (Bitcoin Satoshi’s Vision) over in the other corner, so to speak.
When the upgrade activated during Bitcoin Cash’s 556767th block, ABC quickly took the lead, overtaking SV in terms of hashrate and community support. More specifically, within a few hours, even though ABC suffered a suspected spam attack, Roger Ver’s client of choice left SV in the dust in terms of block height.
Just 40 minutes after activation and the subsequent hard fork, Joseph Young, a well-regarded crypto journalist, explained that “[it] seems like a win for BCH,” adding that “[there’s] certainly not enough for a 51% attack on BCH… SV nodes reportedly crashing.”
While ABC’s initial lead was undoubtedly convincing, some have been skeptical about ABC’s victory prospects. WhalePanda, a diehard Bitcoin maximalist, took to Twitter to explain that ABC’s hashrate boost was solely catalyzed by Bitmain CEO Jihan Wu’s involvement in this debacle. Panda added that the CEO is “scared and burning through a lot of money,” alluding to the fact that ABC could stutter as Wu’s endurance wears.
And, over 24 hours since the upgrade’s activation, as pointed out by Canadian Bitcoin entrepreneur Francis Pouliot, it has become apparent that Wu’s influence over the cryptocurrency mining industry hasn’t been holding up too well. Just hours ago, Pouliot noted that “the race is on,” subsequently drawing attention to SV’s monumental resurgence in terms of hashrate and blocks mined.
Per CoinDance, a website created to monitor all things pertaining to Bitcoin Cash, SV’s recovery was more than just a blip, as the Craig Wright-associated group has seen its hashrate near ABC’s. So, ABC has since seen its lead shrink to just 15 blocks, down from the 50+ block lead seen on Friday morning. Interestingly, ABC has stilled processed 53.8% more hashes than SV, indicating that Craig Wright’s camp isn’t out of the water just yet, as it were.
ABC, SV Miners Both In The Red
Although the two consortiums’ ability to support their respective chains is respectable, ABC and SV have quickly drawn flak from the crypto community at large, due to many of Bitcoin Cash’s critics pointing out how uneconomical, nonsensical, and detrimental this quarrel really is.
Data gathered by BitMEX’s research crew indicates that both groups are mining at substantial losses. Assuming that the Bitcoin Cash miners are using Bitmain’s SHA256-supported S9, spending $0.05 per kWh (assuming that electricity is the only cost), and selling tokens gained at spot IOU prices, BitMEX noted that the miners of both networks have already lost approximately $400,000 each.
In short, both sides are facing qualms, so it is still unclear who will come out on top in the long-run.
Crypto Analysts Point To Bitcoin Cash Amid Market Downturn
Interestingly, many have pointed to the Bitcoin Cash fork debacle as a catalyst behind Wednesday’s sell-off, which saw the aggregate value of all crypto assets fall by upwards of $25 billion.
After not covering the cryptosphere for weeks, CNBC’s Fast Money segment surprisingly brought on Brian Kelly and Meltem Demirors to discuss the potential factors behind crypto’s most recent downtrend.
Kelly, who has been the topic of light controversy in the past, drew attention to the upcoming Bitcoin Cash contentious hard fork. The BKCM CEO, who dubbed the Bitcoin ABC and Bitcoin SV debacle “a crypto civil war,” attributed this market’s most recent decline to concerns that BTC and BCH markets, along with the networks they represent, will under-perform as the hard fork comes to pass.
Andy Bromberg, co-founder and president of CoinList, echoed Kelly’s comments on the looming hard fork, telling the Wall Street Journal:
“A single event, like a fork, can be a significant factor across wider crypto markets thanks to their relative immaturity… Large holders will often make trades across multiple coins, causing ripple effects beyond the asset that instigated the movement.”
Regardless of the specifics, as a result of the continued confusion around the “true winner” of this fork, BCH has continued to capitulate, indicating that this multi-month conflict instilled more fear than faith in crypto investors at large.
Title Image Courtesy of Marco Verch via Flickr