Two weeks ago, a similar volume spike was caused by the sudden (and brief) reversal of fortunes between Bitcoin and Bitcoin Cash (BCH), as the cancellation of the scaling proposal SegWit2X led to a massive pump of the latter.
Prices for BCH rose to a stunning $2,500, and many speculated that the community had begun shifting loyalties. As the BCH price pump continued, BTC lost 25% of its value, dropping to $5,500.
In a sign that adoption is massively increasing, trading numbers from last weekend indicate that the volume of cryptocurrency trades exceeds that of many US equities trading markets. The volume of Bitcoin traded on this past Sunday alone was more than $5 bln – more than the IEX, the Chicago Stock Exchange, as well as many others.
Yet the reversal was reversed again, as Bitcoin came roaring back and Bitcoin Cash slumped. The price of Bitcoin quickly returned to its previous level, then consolidated at an all-time high before pushing through $9,000 and threatening the carefully-watched $10,000 level this weekend.
Devotees to either cryptocurrency will argue that the other is a ‘fraud,’ echoing the words of anti-crypto incumbents. However, a more emotionally removed view of the situation should be encouraging for all. Such huge volumes of trading show that demand for and participation in crypto markets is increasing.
Though the end of SegWit2X may have brought some BCH buyers out of the woodwork, it appears that many of the market movers are less convinced. Nevertheless, the substantial price bump has brought the altcoin into the spotlight, increasing adoption. For example, Ami Ben David Co-Founder of SPiCE VC said:
“We clearly see stronger support for Bitcoin as the original and decentralized coin, but at the same time, Bitcoin Cash has suddenly arrived in terms of adoption levels to the size of Ethereum, to the point where we have decided to add Bitcoin Cash as an investment option on our token sale and we expect other token issuers to follow suit.”
This week’s spike in the price of Bitcoin was met with equally impressive rallies in a number of altcoins, with Dash, Ethereum and Litecoin soaring to all-time highs as well. This is highly unusual, as Bitcoin’s bull runs usually suck money out of altcoins and causes a slump in their prices. The concurrent growth of Bitcoin and altcoins is a good sign: it indicates that outside money is flowing into digital currency.