Bitcoin Cash has surged more than 50% in the last 24 hours, surpassing $3,000 and reaching its latest, all-time high.
The digital currency, which is similar to the original Bitcoin but with greater capacity to process transactions, had risen to as much as $3,335.35 at the time of report, according to CoinMarketCap.
This figure represented a 52% increase over the last 24 hours, additional CoinMarketCap figures show.
Interestingly enough, Bitcoin Cash enjoyed this sharp rally as traditional Bitcoin fell more than 5%, according to the CoinDesk Bitcoin Price Index.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
As for what caused Bitcoin Cash to surge like this, analysts pointed to a handful of different variables.
Bitcoin Network Challenges
More than one market observer pointed to the challenges plaguing the Bitcoin network, emphasizing its slow transaction times and high fees.
Neelabh Dixit, co-founder of digital asset management firm Cryptomover, stated that these difficulties are making investors "anxious" about "bitcoin's future."
As a result, market participants have been flocking to Bitcoin Cash, which has larger blocks than traditional Bitcoin and can therefore process far more transactions at any given time, he said.
Chris Keshian, co-founder of the Apex Token Fund, a tokenized crypto fund-of-funds, offered a similar point of view.
"Bitcoin's slow transaction times and high fees make it untenable as a daily currency," he stated.
"BCC does not have these same issues, and has been touted recently in the news under the banner of quick, cheap peer to peer payments."
Active Management Strategies
Traders have also been piling into Bitcoin Cash as part of their active management strategies, seeking to either hedge their exposure to downside risk or produce superior returns.
"Many investors see Bitcoin Cash as a hedge against Bitcoin in their portfolios," noted Keshian. "So as their Bitcoin holdings increase, they move into BCC positions to appropriately hedge their risk."
Tim Enneking, managing director of Crypto Asset Management, offered a different take on the situation.
Many investors are rotating out of Bitcoin and into other digital currencies, he stated.
Enneking added that "It’s rarely that one sees BTC in [red] on CMC and everything else green!"
Disclosure: I own some Bitcoin and Ether.
After months of rumors, it's official: Bitcoin Cash (BCH) is coming to Coinbase.
A blog post on Tuesday has officially confirmed what many have been speculating for months: Bitcoin Cash—a fork of the Bitcoin blockchain—is headed to popular cryptocurrency brokerage Coinbase, effective as soon as there is "sufficient liquidity" on GDAX.
Users will be able to buy, sell, send, and receive Bitcoin Cash on the platform.
This follows a recent surge in price in BCH. Following the announcement, Bitcoin plunged by 12 percent, dropping below $17K, while BCH jumped several hundred dollars, clearing the $3K mark. The current listed price on CoinMarketCap is $3,387.54.
In the post, Coinbase expressed their belief that customers should not be hurt by forks that occur outside their control, saying:
Coinbase operates by the principle that our customers should benefit to the greatest extent possible from forks or other networks events. This is essential in our mission to make Coinbase the most trusted, safe, and easy-to-use digital currency exchange.
Coinbase's previous update about Bitcoin Cash can be found here. Read this post on Blockgeeks for more information on Bitcoin Cash.
Editor’s Note & Disclosure: The author invests in cryptocurrency markets. Neither the author nor Forbes endorses participation in any token sale or cryptocurrency investment, all of which have significant inherent risk. Seek advice from a financial advisor as well as do your own due diligence before considering investment.
Bitcoin is facing a major threat as a cloned cryptocurrency that shares its name and many of its key features launched on one of the largest cryptocurrency exchanges, sending Bitcoin prices tumbling.
Bitcoin's price fell 10 per cent on Tuesday as Bitcoin Cash, a rival digital coin, arrived on Coinbase, one of the most popular cryptocurrency trading platforms. Bitcoin has fallen from almost $20,000 (£15,000) on Sunday to under $17,000 on Wednesday morning.
Bitcoin Cash was launched over the summer by a splinter faction of cryptocurrency developers. It has gained traction in recent months soaring to around $3,000 (£2,200) per coin and jumping almost 50 per cent in overnight trading.
The price of Bitcoin Cash briefly reached more than $8,500 on Coinbase's own exchange, significantly more than the $3,500 it was trading at on other indexes.
Coinbase was forced to halt Bitcoin Cash trading its...
Image copyright Getty Images Image caption Coinbase's chief executive said he had emailed staff ordering them to keep the Bitcoin Cash launch a secret
One of the US's leading crypto-currency exchanges is carrying out an insider trading investigation.
Coinbase fears its own workers may have exploited its move into Bitcoin Cash - a spin-off of the original Bitcoin.
The San Francisco-based firm announced the move after Bitcoin Cash's price jumped.
Coinbase began letting its users buy, sell, send and receive Bitcoin Cash on Tuesday in a surprise decision but has temporarily suspended trade.
The company's chief executive intervened after several market watchers posted allegations of illegal activity on social media sites.
Brian Armstrong responded that he had repeatedly warned his staff not to disclose its launch plans to family or friends or to trade in the digital asset themselves.
"It appears the price of Bitcoin Cash on other exchanges increased in the hours before our announcement," he wrote on the news site Medium.
"If we find evidence of any employee or contractor violating our policies - directly or indirectly - I will not hesitate to terminate the employee immediately and take appropriate legal action."
Image copyright Reuters Image caption Bitcoin Cash was created four months ago
Bitcoin Cash - which is no more tangible than Bitcoin itself - came into being in August after several developers became frustrated at lengthening transaction times for the original crypto-currency.
Bitcoin Cash addressed this problem by tweaking the underlying technology - the blockchain - to allow bigger chunks of data to be processed at a time.
Although there have been other Bitcoin splits before, this "fork" was unusual in that everyone who owned the original virtual currency was offered a matching sum of Bitcoin Cash. This effectively created money out of nothing.
However, many exchanges, including Coinbase, initially refused to support the innovation, casting doubt on its prospects.
Price surge
Claims of insider dealing were not the only hitch that Coinbase experienced when it finally added support for the new asset.
Trade of Bitcoin Cash was frozen just four minutes after it began on the firm's Global Digital Asset Exchange (Gdax) and existing orders were cancelled.
The move seems to have been a reaction to an apparent price surge in Bitcoin Cash on the platform beyond its already elevated level elsewhere.
When Coinbase launched Bitcoin Cash at 17:20 PST (01:20 BST) it was valued at about $3,500 (£2,612) per coin.
At the time it suspended it, the company was quoting a price of about $8,500. It remains unclear whether or not this was a software glitch or if deals were really being made at this level.
Coinbase has yet to give a full explanation but has said that it intends to reopen Bitcoin Cash order books later on Wednesday.
Bitcoin Cash is currently the world's third biggest crypto-currency with a total market capitalisation of about $59bn, according to Coinmarketcap.
That compares with there being $77bn worth of Ethereum and $282bn worth of the original Bitcoin.
