Bitcoin.com has seen tremendous growth over the past year, primarily due to the mounting global demand for the digital currency. In a surprising turn of events, the website’s CTO and co-founder Emil Oldenburg has ditched Bitcoin and taken on Bitcoin Cash as an alternative. In an interview with the Swedish website Breakit, he admitted: “I have in fact sold all my Bitcoins recently and switched to Bitcoin Cash.”
The move carries an apparent conflict of interest for his company, which acts as a Bitcoin wallet. However, Mr. Oldenburg cited high transaction costs and slow execution times as the reasons for his decision. Both of these factors have been improved in Bitcoin Cash, a hard-fork of Bitcoin.
There is some merit to his claims of high transaction costs. During 2017 alone, Bitcoin transaction costs have risen from an average of 20 cents to current levels of roughly $15. The transaction fees are doubling roughly every three months.
Pure Markets' CEO Talks Business Model, 2020 OutlookGo to article >>
Time is Money
The slow transaction times create a scenario for a digital currency that could become very illiquid in nature, thereby increasing the risk of holding such an asset. Bitcoin transaction confirmation times have climbed to an average of 4.5 hours. In the aforementioned interview, he claimed that “an investment in Bitcoin right now I would say is the most risky investment one can make. It is extremely high-risk. I’ve actually sold all of my Bitcoins recently and switched to Bitcoin Cash.”
The reasons for the slow transaction times can be attributed to the technology that stands behind the digital currency. There is a limited number of transactions that can be recorded on the blockchain, each with a differing amount of necessary memory. As trading volume has increased dramatically over the past year, the number of transactions being placed has grown exponentially, causing delays in the processing time. Mr. Oldenburg went on to say that “the old Bitcoin network is as good as unusable.”
Bitcoin Cash is King
Mr. Oldenburg’s recent decision to sell his Bitcoin holdings has led to logical questions regarding the infrastructure of Bitcoin.com. Bitcoin Cash was created in August 2017, with a focus on alleviating some of the previously mentioned issues found in Bitcoin.
Oldenburg’s comments regarding the website’s future plans were rather in sync with his bearish views on Bitcoin: “We’ve actually stopped developing new services for the old Bitcoin network now and are focusing mostly on [developing for] Bitcoin Cash. Where it costs only 10 öre [$0.12] to send [BCH] and there’s no waiting. The only backside is that it requires larger hard drives, but that’s not a problem for most people.” Moreover, Bitcoin.com integrated Bitcoin Cash into all of the company’s wallets.
In the constantly changing environment of cryptocurrencies, it is important to stay up to date with the latest changes across the market. Those who can accurately detect the strongest and most efficient technologies behind digital currencies are likeliest to find the most lucrative path to success.