December 17th of 2018, saw the first time in history that the price for Ether goes beyond Bitcoin Cash, one of the strongest cryptocurrencies today. As of this article’s writing, Ether’s price stands at $92, a couple of Dollars above Bitcoin Cash (ABC), who sits at $90.
This was certainly a surprise for many, even if others were already expecting it. Now, we will go through all the information regarding the happening and shed a bit of light about what could have caused it.
An Unexpected Event.
The crypto markets have been giving investors some breathing room lately, with even Bitcoin having a brief boost in price. Therefore, several coins saw their charts moving upwards today, but Ether surprised everyone.
Several price trackers, including CoinMarketCap and CoinTelegraph were the channels through which traders were able to witness the momentum with which ETH flew past BCH, with CoinTelegraph reporting the event when ETH sat at $90.8 and BCH at $88.6.
As of this article’s writing, their price still sits approximately $2 apart.
This is a first for the crypto market, as Bitcoin Cash has always been the second largest cryptocurrency when it came to price per unit, previously sitting at $1,500 when Ether stayed at $800, or at $500 when Ether sat at $200.
It has earned a lot of attention in the last hours, partly thanks to the lack of competition it has regarding crypto news, as Bitcoin keeps rounding the lows without significant gains.
The Bitcoin Cash Hard Fork: A Possible Catalyst.
There are many possible reasons for this occurrence, but the BCH-BSV fork last month is easily the most likely cause for Bitcoin Cash’s “defeat” against Ether.
A strong controversy started back in November, when a statement from the self-proclaimed Satoshi Nakamoto (allegedly) indicated that the scalability measures that Bitcoin Cash ABC used were not the way that Bitcoin was meant to function, so Bitcoin Satoshi’s Vision was born (hence BSV). The included propositions was to increase the block size from 32MB to 128MB.
The debate goes further than that, and the Bitcoin Cash “side” is also technically divided between Bitcoin Cash ABC and Bitcoin Unlimited, but in the interest of simplification and time, that explanation is enough.
Now, any trouble that occurs in a bear market will greatly damage the value of any currency, and whereas the Bitcoin Cash and Ethereum Classic forks benefited investors during a thriving market, the BSV fork only added uncertainty to an already stressed industry, further diminishing prices.
What Drives The Value Of A Cryptocurrency?
There are many elements that can affect the value and price of an asset, and this is true for anything, from shares and products to currencies.
First, we have trust. Especially with cryptocurrencies right now, the trust that the world has in them will go a long way dictating whether they stay or fade away like other inventions in the past. This element is the one being affected the most by the Bitcoin Satoshi’s Vision hard fork.
However, there is another important matter when it comes to why Ether surpassed Bitcoin Cash: usefulness.
Bitcoin Cash is meant to be a medium of exchange, essentially money in a digital form. On the other hand, Ethereum is a platform with a function: to create programmes and smart contracts.
In this case, Ether is more of a requirement for access to the Ethereum platform than just a coin. In other words, Bitcoin Cash would be a Dollar while Ether would have utility. As Ether has more uses beyond simply signifying value, its price has more potential long term upside if the Ethereum network proves successful.