Key facts: With the halving, the reward for mining Bitcoin Cash drops to 3,125 BCH. Bitcoin miners are likely looking for a second life in Bitcoin Cash. The mining subsidy Bitcoin Cash split in half for the second time in its history this Wednesday, April 3. The event known as halving took place at block height 840,000, as will occur in the Bitcoin network in the coming weeks. Bitcoin Cash is a fork of the Bitcoin network. This project was born in 2017 as a result of a technical-ideological division in the Bitcoin community when an agreement was not reached on the method to get the network to process more transactions. Since then, both networks have existed as separate projects, but several of their technical features remain similar. As will happen with Bitcoin, in the Bitcoin Cash halving the reward paid to miners for maintaining the security of the network dropped from 6.25 BCH to 3.125 BCH. The decrease in the issuance of Bitcoin Cash was causing expectations among investors, causing the price of the cryptocurrency to experience a 30% rise in the last month and reach 2021 prices. However, in the last 24 hours, day of the halving, BCH is down more than 8%, suggesting profit-taking among traders or a strategy of buying the rumor and selling the news. At the time of this publication, Bitcoin Cash is trading below $588.
The price of Bitcoin Cash fell before the halving, but then rose 3%. Source: TradingView. Following the rise in its price, which has grown more than 350% in a one-year range, the Bitcoin Cash hashrate also increased significantly, as reported by BitcoinDynamic, especially since June 2023. This has probably been an anticipation of miners faced with the imminent drop in the reward, as has also happened in the case of the Bitcoin network. At the time of writing, the Bitcoin Cash hashrate exceeds 5.32 EH/s. While the reduction in the mining reward on Bitcoin Cash will make this network less profitable to mine, the fact that its hashrate is lower than that of Bitcoin (it recently came close to exceeding 800 EH/s), and that it runs on the same mining algorithm, suggests that many of the ASIC equipment that will become obsolete for the Bitcoin network They could seek a second life in Bitcoin Cash and other networks that work with the SHA-256 algorithm.
The Bitcoin Cash hashrate reached its all-time high of 6 EH/s on April 1. Source: CoinWarz.
Bitcoin Cash continues to differentiate itself from Bitcoin
Although they share similarities, since its fork in 2017, the Bitcoin-based project continues to introduce updates to its protocol to find its own place in the market. For next May, update called Jessica is expected, which seeks to adjust the Bitcoin Cash block size limit based on network usage in order to align infrastructure costs with the demand for block space for transactions. It should be remembered that it was precisely the block size limit that caused the separation between Bitcoin and Bitcoin Cash.