Just over one year ago, the original Bitcoin network was split into two chains in a ‘hard fork’ event, where individuals looking for something new altered Bitcoin’s open-source code to create Bitcoin Cash. Since then, Roger Ver, who has been dubbed “Bitcoin Jesus” in the past, has openly endorsed Bitcoin Cash (BCH) over the original Bitcoin chain, or ‘Bitcoin Core’ as Ver calls it. In fact, “Bitcoin Jesus” has even altered his Bitcoin.com domain to promote Bitcoin Cash, instead of Bitcoin as it did prior to Ver’s ‘conversion’.
Ver, who is rather outspoken about the power of decentralization, has continually noted that Bitcoin Cash has ousted Bitcoin as a form of digital cash. But according to recently revealed data from blockchain statistics firm Chainalysis, relayed by Bloomberg, this is far from the case. Chainalysis’ inquiry into the world’s 18 foremost crypto-centric merchant payment processing solutions, like BitPay, Coinify, and GoCoin, has found that Bitcoin Cash’s use in retail payments has taken a sharp decline.
As per statistics gathered by the aforementioned firm, only (relatively) $3.7 million in Bitcoin Cash payments were made in May, which is down from an all-time high of $10.5 million in March. In the case of Bitcoin, payments amounted to $60 million in May, which is down from September’s peak of a staggering $412 million.
This declining use in merchant payments has been seen across the board, as a likely result of the bearish trend the crypto market has experienced since the start of 2018. Speaking more on the situation with Bitcoin Cash, Kim Grauer, a senior economist at Chainalysis stated:
“There are fewer users of Bitcoin Cash, fewer holders.”
Grauer went on to note why the adoption of Bitcoin Cash in commerce has been minimal. He pointed out that a large portion of the distributed BCH is concentrated between a small number of wallets. Approximately 56% of Bitcoin Cash is controlled by 67 non-exchange-affiliated wallets. Of those 67, approximately two wallets hold between 10,000 and 100,000 units of BCH, or approximately $5.5 million and $55 million at current market prices. Citing these statistics, the aforementioned Chainalysis executive added that BCH ‘whales’ are likely the individuals who are utilizing BCH in commerce.
However, Ver has seemingly remained calm in the face of these statistics, noting that “the long-term price of a crypto currency is a function of its usefulness as a currency.”
Cryptocurrencies In Retail Payments — The Next Step
Although there is a continual debate between the ‘Bitcoin Core’ and Bitcoin Cash communities, some have brought attention to the fact that this cryptosphere infighting should not be a priority, as crypto proponents should focus on increasing the adoption of cryptocurrencies and DLTs overall.
The issue is, many traditional retailers, whether it be your run-of-the-mill convenience store or supermarket chain, have been slow to adopt cryptocurrencies as a widely-accepted form of payment. Whether this is due to the lack of infrastructure, volatility in markets or a general stigma around the cryptosphere remains to be seen. But the grind continues, with developers and industry leaders doing their best to drive retail stores to accept crypto, as this should be the next step in the development of this nascent industry.
Photo by David Shares on Unsplash