Decline in price and decline in mining profitability of PoW currencies form a feedback loop
Bitcoin is already leveraged.
Its Proof-of-Work mining which allows transactions in it is only beneficial as long as Bitcoin is above a certain level, and at some price level, mining becomes speculative, assuming the price will rise more, or at least not go below that certain price level.
Once Bitcoin crashes, some miners may defect.
Once miners defect, Bitcoin becomes more centralized, and transaction fees' portion of the transaction may rise as well.
Recently, I have seen reports about Bitcoin Cash becoming more profitable to mine than Bitcoin, which may lead some miners to deffect, in addition to BCC's ICO which in itself comes at the expense of BTC's market share, since investors/traders now have more asset to put their cash into.
So BCC, and in a similar way, every ICO, can potentially crash Bitcoin, because once a downward move starts, it will be a chain reaction, a self reinforcing process.
The question remaining is if BCC has an added threat over Bitcoin, beside of its name, that other cryptos lacked, because they failed to crash Bitcoin so far.
Decline in price and decline in mining profitability of PoW currencies form a feedback loop
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True. Optimum mining profit states that BTC/BCC hash power and price will have the same ratio. However, there are two important factors:
-New York Agreement: Signers of this agreement control more than 80% of Bitcoin hash rate. As long as this agreement remains active, a vast majority of hash rate will be supporting Bitcoin. However this agreement is quite fragile. Bitmain, one of the members with highest hash rate, already said that they may start mining Bitcoin Cash if any of the members do it before.
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