Bitcoin Cash (BCH), an early offshoot of the pioneering digital currency Bitcoin (BTC), has experienced a huge surge in value, more than doubling in the span of just one week. The catalyst for the Bitcoin Cash surge can be attributed to the launch of a new cryptocurrency exchange backed by prominent firms such as Citadel Securities, Fidelity Digital Assets, and Charles Schwab.
EDX Markets, an institutional-only exchange that was announced in September 2022, recently commenced operations, offering trading options for four major cryptocurrencies: Bitcoin, Ether, Litecoin, and Bitcoin Cash.
This development sparked renewed interest in Bitcoin Cash, attracting speculative traders who sought out crypto assets with better regulatory clarity, according to Spencer Hallarn, a derivatives trader at GSR, a renowned crypto investment firm, as reported in Bloomberg.
Bitcoin Cash’s ascent to popularity began in 2017 when it broke away from Bitcoin, instigating what became known as the “forking craze.” This trend involved numerous software development teams altering the original Bitcoin code to create new cryptocurrencies bearing the name “Bitcoin.” With the objective of becoming a reliable global payment system characterised by fast transactions, minimal fees, privacy, and larger block size, Bitcoin Cash emerged as a permissionless and decentralised cryptocurrency that operated without the need for trusted third parties.
Bitcoin Cash’s creation was a response to the limitations of Bitcoin, the first and most valuable cryptocurrency. In a momentous move, BCH developers modified the BTC code, leading to the release of their software version and a fully-fledged competitive product. This divergence resulted in two distinct blockchains: Bitcoin and Bitcoin Cash. Subsequently, Bitcoin Cash experienced another split in the fall of 2018, resulting in the emergence of Bitcoin ABC and Bitcoin SV.
The contentious scaling debate played a significant role in these divisions within the Bitcoin Cash community. While proponents of small blocks opposed increasing the block size, citing concerns about blockchain centralization and node vulnerability, advocates for larger blocks sought
faster solutions due to rising transaction fees that posed obstacles to growth.
The recent Bitcoin Cash surge has also been influenced by major financial institutions entering the cryptocurrency arena. Notably, BlackRock, the world’s largest money manager, has filed an application for an exchange-traded fund (ETF) that would utilise Bitcoin as an underlying asset. This development has ignited optimism that regulatory approval for the long-anticipated fund might finally materialise.
Furthermore, Deutsche Bank, one of the world’s leading lenders, is seeking to establish a crypto custody business to cater to its clients’ digital asset storage needs. These endorsements from established institutions with a prominent presence on Wall Street have contributed to the upward trajectory of cryptocurrency values, particularly Bitcoin.
Bitcoin reached its highest price in a year, surpassing the $30,000 mark for the first time since April, peaking at $31,389 on Friday according to Coinmarketcap data. Year-to-date, Bitcoin has experienced an 81% increase in value. This surge in Bitcoin’s price has been accompanied by impressive gains in other cryptocurrencies, such as Ether (ETH-USD) and Avalanche’s AVAX (AVAX-USD) token.
The overall market capitalisation of the cryptocurrency market also witnessed significant growth, reaching $1.2 trillion on Friday, marking a 14% increase compared to the previous week.
As the cryptocurrency ecosystem continues to evolve and attract attention from both retail and institutional investors, Bitcoin Cash has emerged as a noteworthy contender, experiencing a substantial surge in value driven by the launch of a new crypto exchange, and increasing endorsements from major financial players. These recent developments signal a growing recognition and acceptance of digital assets within the global financial landscape.
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