Bitcoin hit another record high on Thursday, shaking off a 29 percent plunge it suffered just three days earlier, in a continuation of the price volatility in the crypto-currency
After erasing as much as US$38 billion in market capitalization on Monday, bitcoin came roaring back in to set a new high of US$7,846.38 on Nov. 16, according to a Bloomberg report.
The virtual currency saw a huge selloff early in the week following the cancellation of a technology upgrade known as SegWit2X on Nov. 8.
“My sense is that [Thursday's] rally is driven by a resurgence in interest and viability for the Segwit2x hard fork,” Bloomberg quoted Spencer Bogart, head of research at Blockchain Capital, as saying.
“Despite the fact that it was called off, there is still some group of people that will follow through with the intended fork. As a result, I believe some capital is rotating out of other crypto-assets and into bitcoin to make sure they receive coins on both sides of the fork.”
While multiple reasons have been cited for the recent price volatility, one of the more viable is that some investors were switching to alternative coins, Bloomberg noted.
Bitcoin cash, an offshoot of bitcoin that includes many of the technical upgrades being debated by developers, had more than doubled recently.
The main difference between bitcoin and bitcoin cash is the block size. Bitcoin’s blocks hold 1 megabyte of data, while bitcoin cash holds 8 megabytes, according to the report.
A block is equivalent to a file storing data on approved transactions, which is uploaded and hooked to the previous file, and makes up the blockchain.
Supporters of bitcoin cash say bigger blocks allow for faster and cheaper transactions, and view the size increase as the update bitcoin needed to become a better means of exchange to compete with payment services such as Visa or Master Card.
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