As Bitcoin hard forks yet again, price surge ends; competitors inch forward

The relentless charge of Bitcoin halted as the price of the cryptocurrency dipped during this week. Meanwhile other cryptocurrencies gained ground.

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Big institutional investors have stopped short of investing in bitcoins despite its sharp rise. (Representational image)

The price surge of Bitcoin has eased out after its meteoric surge to $6200 last week. Prices plunged by 10% in the exchanges to $5600, indicating that sanity will prevail in the volatile market place. The 20-day exponential moving average EMA lies at below $5400 so there is some chance that resistance can develop at that level. However, we believe that the current slide could see the price of the cryptocurrency drop to well below $5000.

Big institutional investors have stopped short of investing in bitcoins despite its sharp rise. After JP Morgan boss Jamie Dimon trashed it, Prince Alwaleed of Saudi Arabia who spoke to CNBC said that it was a hoax. He believed that the unrecognized and unregulated digital currency will blow up and be another Enron type financial scandal that will create mega losses for investors.

Bitcoin has its challenges

The cryptocurrency is going to the market once again with Bitcoin Gold. This, after it introduced another variant on the Bitcoin blockchain in an effort to improve the technology by changing how it rewards competition. This was the second round of ‘hard fork’ and grabbed less attention than the August launch of Bitcoin Cash. Consequently, the markets gave a relatively lukewarm response to Bitcoin Gold BTG.

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But Bitcoin Gold has other challenges. It aims to undermine the powerful miners and create the currency through open source software and reduce the high transaction costs currently hindering the digital currency. This is a noble thought but has few takers. As a matter of fact the developers community was itself split on the need to hard fork. While the SegWit2x group wanted this hard fork, majority of the other developers said that they did not want rushed or repetitive hard forks.

Ethereum gains ground, but Ripple could be the future

These uncertainties ensured that the focus was off the Bitcoin cryptocurrency during the week. This helped others to gain ground and the situation could continue like this for whole of this month. Among the other cryptocurrencies that gained ground was Ethereum, which posted moderate gains. Ethereum recovered by over 5% to touch the $300 mark. Litecoin, which has been continuously rising since the last month and had touched the $65 mark on 16th October, slipped before the weekend and recovered to $55 this week. This digital currency is based on open source software and cannot be controlled by any central authority.

Ripple is the cryptocurrency that ensures low cost international payments and has better end to transparency and lower costs. Its method of conformation does not need mining and is a comparatively transparent low-cost consensus ledger. Though its market capitalization is currently low, it is the right digital currency for big banks to leverage. It is trying to distribute its XRP to institutions through business development deals.

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