After a steady rise in cost, which continued for the best part of a year, the price of bitcoin fell below $5,700 on the day before. The scale of the drop was completely unexpected and unprecedented, since the flux has never included variation of such magnitude. This, in turn, prompted traders to rebalance their respective portfolios in order to stake out bigger positions in altcoins, right after the Bitcoin Gold fork.
All the while, ethereum price experienced a recovery of 8 percent, while NEO and Dash, which are 2 of the top 10 digital currencies, reported increases in the double digits.
Price of Bitcoin Dips after the Bitcoin Gold Fork
It was recently reported that a developer in Hong Kong wants to formulate a cryptocurrency which has some shared blockchain past with Bitcoin. To accomplish this, the altcoin developer takes a ‘snapshot’ of a Blockchain, right at a certain moment. This snapshot then functions as the initial launching pad for Bitcoin Gold. This is despite the continual transactions within the actual bitcoin blockchain.
The snapshot took place on Tuesday morning, and to compensate for the fork, the holders of the cryptocurrency balance will get duly compensated with a similar amount of Bitcoin Gold, right after its launch. This is just like the Bitcoin Cash fork, which occurred on August 1st.
Even though the value of Bitcoin Gold is not expected to be much, there are traders who had commenced the accumulation of Bitcoins before the snapshot. This was in order to maximize the potential profits which can be gleaned through the fork.
Right after the snapshot, traders gained the ability to sell off their bitcoins without actually falling short of the Bitcoin Gold drop.
The Current Value Scenario
Right before the fork occurred, the cryptocurrency was being traded at a very high value; $5,984 to be precise. The fork, as soon as it occurred, resulted in a gradual fall of prices. The price continued to fall, eventually coming to a rest at $5,580. Since then, the value of the currency has risen, and recoved to an extent, being currently at $5,690.
Even though the recovery is being lauded as symbolic of the potential viability of Bitcoin, the fact still remains that for a period of 24 hours, the price of Bitcoin fell quite a bit; a fall of 3.5 percent to be exact. The current market cap of the cryptocurrency is $94.7 billion.
Shifting Trader Attention towards Altcoins
While Bitcoin experienced a fall, altcoins saw a recovery, especially in the eyes of traders who were concerned with the ramifications of the fork. This led to almost all major altcoins, with the exception of Bitconnect, experiencing positive attention and movement.
Whether altcoins are a stable investment, is still unknown, partly due to the recovering value of Bitcoin, and partly due to the uncertainty surrounding altcoins. This uncertainty comes from the majority of account holders, who still see Bitcoin as the only suitable investment.