The crazy ride of the cryptocurrencies in 2017 has certainly made one set of firms very rich – the cryptocurrency exchanges. Many exchanges have now become mammoth in size and with this, any sudden activity by them has the potential to directly affect the prices of the coins.
The unregulated nature of these exchanges is also a matter of concern as they can manipulate prices without any strict action.
Recently, BitMex, one of the leading cryptocurrency exchanges, has liquidated all its users’ Bitcoin Cash holdings for Bitcoin.
In an official announcement, the exchange confirmed that it has successfully sold all of the Bitcoin Cash and has compensated users in Bitcoin in the ratio of 1 BCH to 0.1707 XBT.
Today, the Bitcoin community is mostly divided between the two communities, one advocating Bitcoin Cash and the other totally against it. This disagreement led to the generation out of thin air of an all-new coin with billions of dollars in market cap. The Bitcoin Cash community has been growing and is now one of largest in the crypto space.
The current liquidation of Bitcoin Cash by BitMex clearly shows its bias for promoting Bitcoin. Though the exchange did not disclose the exact liquidation volume, the vast Bitcoin-to-dollar trading volume on the platform implies a sizeable Bitcoin Cash holding.
Luckily, the sell-off did not have a direct impact on the market as Bitcoin and Bitcoin Cash prices were already in a downturn amid the news of tightening regulatory rule in South Korea.
Bitcoin Cash was the first successful hard fork of Bitcoin and was created in August last year. The aim of the fork was to overcome the shortcomings of the Bitcoin’s network. With a block size of 8 MB compared to Bitcoin’s 1 MB, Bitcoin Cash’s network is capable of handling a higher number of transactions, overcoming a massive roadblock in the Bitcoin network today.
Another major problem with the current Bitcoin network is the increasing transaction fees. From a couple of cents, the Bitcoin transaction fees have increased to tens of dollars which make it unsuitable for small transactions. The transaction fees of Bitcoin Cash, on the other hand, are a fraction of those of Bitcoin.