Bitcoin Cash Enhances Transaction Capacity and Lowers Fees
Bitcoin Cash emerged on August 1, 2017, as a split from the original Bitcoin network, quickly establishing itself as one of the most valuable cryptocurrencies globally. Created by a group of Bitcoin users, Bitcoin Cash aimed to implement technical changes to enhance Bitcoin’s scalability and compete with traditional payment systems like Visa and PayPal.
Advocates of Bitcoin Cash believed that Bitcoin required adjustments to remain competitive and reduce transaction fees. By modifying Bitcoin’s code and launching a new software version, Bitcoin Cash offers lower fees and a higher transaction capacity due to its increased block size. Many analysts believe that by prioritizing lower transaction costs, Bitcoin Cash could attract more consumers, ultimately increasing its value.
Deutsche Bank Survey Shows Pessimism
Although Bitcoin Cash (BCH) had a successful 2023, its price has fallen more than 20% since January 12, 2024. This comes despite the SEC’s approval of 11 spot Bitcoin ETFs. According to a report from Deutsche Bank, based on a survey conducted between January 15 and 19, most respondents expect further declines in cryptocurrency prices.
The survey, which involved 2,000 individuals from the U.S., U.K., and the Eurozone, focused on their views regarding Bitcoin’s price and volatility. Deutsche Bank analysts noted that the approval of Bitcoin ETFs is expected to institutionalize Bitcoin, but they also pointed out that most ETF inflows come from retail investors.
Bitcoin Cash Now Part of the Mainstream
The recent downturn in the cryptocurrency market is linked to both technical reasons and growing accessibility. Some analysts suggest that as cryptocurrencies become more widely traded, their prices reflect more information, which may signal a decrease in value. Furthermore, the rise of Bitcoin as a mainstream asset alters its original role as an “outsider” asset aiming to challenge government functions.
JPMorgan reported that the crypto market decline coincided with large withdrawals from Grayscale’s Bitcoin trust, which were converted into a Bitcoin ETF after SEC approval on January 10. JPMorgan’s Kenneth Worthington believes that the Bitcoin ETF, which previously boosted the market, might disappoint investors in the near future.
Technical Analysis for Bitcoin Cash (BCH)
Bitcoin Cash (BCH) has dropped from $298.64 to $218.70 since January 12, 2024, and is currently priced at $237. The cryptocurrency may struggle to maintain a price above $220, and if it falls below this threshold, it could potentially test the $200 level.
Key Support and Resistance Levels for Bitcoin Cash (BCH)
From the chart dating back to January 2023, important support and resistance levels for Bitcoin Cash (BCH) are marked. The cryptocurrency has weakened from recent highs, but if it rises above $280, the next target would be the resistance at $300. The key support level is $220; if the price falls below this level, it will be a “SELL” signal, with potential for a decline toward $200. If the price drops below $200, which is strong support, the next target could be around $180.
Reasons for Potential BCH Price Increase
The cryptocurrency market is known for its volatility, and although efforts have been made to stabilize it, fluctuations are still expected. Overall market sentiment could play a significant role in BCH’s price trajectory in the coming weeks, and positive developments could result in notable price increases. Bitcoin Cash (BCH) remains under pressure, but if the price rises above $280, the next resistance target could be $300. Additionally, BCH’s price tends to move in correlation with Bitcoin’s price, so if Bitcoin rises above $50,000, BCH could also see an increase in value.
Factors Indicating Further Decline for Bitcoin Cash (BCH)
The decline in Bitcoin Cash’s price could be driven by various factors such as negative rumors, market sentiment, regulatory changes, technological advancements, and macroeconomic trends. Cryptocurrencies’ volatile nature could cause investors to sell BCH if negative news surfaces. Therefore, investing in BCH carries a high degree of risk and uncertainty. Given comments from JPMorgan analysts, the catalyst behind Bitcoin ETFs may not meet expectations, limiting BCH’s potential for growth in February 2024.
Expert Opinions on Bitcoin Cash
Bitcoin Cash (BCH) is showing a correlation with Bitcoin and other cryptocurrencies, and since January 12, 2024, BCH has weakened by more than 20%. According to a Deutsche Bank survey, most participants predict a continued decline in the prices of cryptocurrencies, which is unfavorable for BCH. JPMorgan also noted that Bitcoin’s recent downturn aligns with significant withdrawals from Grayscale’s Bitcoin trust.
These withdrawals were converted into a Bitcoin ETF following SEC approval on January 10. JPMorgan’s analyst Kenneth Worthington believes that the Bitcoin ETF catalyst will disappoint market participants in the near future. Analysts are concerned that if Bitcoin’s price drops below $40,000, a more significant sell-off could occur, making it difficult for BCH to hold its current price levels.
Отказ от отговорност: Cryptocurrency is highly volatile and not suitable for everyone. Never invest money you cannot afford to lose. The information on this site is for educational purposes only and should not be construed as investment advice.
