And Another Huge Black Swan For Bitcoin Cash! I Would Say Strong Sell!
A few days ago I wrote an article as a warning for Bitcoin Cash investors and I thought that I pointed out all the risks. Till I came to THIS article written by a Bitcoin Cash trader who found a HUGE threat for Bcash and documented it in dept. When the market turns bullish again this threat gets smaller, but when the bear market goes on for a while or we get some sideway movement this doom scenario becomes very likely!
Here is my own description of the general threats for Bcash:
Is a huge black swan for Bcash coming?
But when I read the article I mentioned I was really like:
WOW, THIS COULD BE A REALLY BIG DEAL
The BCH black swan approaching
The article describes that Chinese miners and miner manufacturers like Bitmain, ViaBTC, and a few unknown entities have been hoarding BCH since the beginning and are owning huge amounts. The wallets are identified and all the mining rewards / sales revenues are never cashed out. These wallets contain multiple times more BCH than the cold wallets of the bigger exchanges (between 664.000 and 1.330.000 BCH, is a HUGE part of the total supply since a lot of BCH is never claimed!)
The article also describes how these entities are manipulating the price in an unnatural way to make their stack as valuable as possible. Screenshots support these claims, it seems very likely.
Bitcoin crashed 70%, but BCH even more. The miners have to spend quite a lot to keep the hardware running, and since the fees on BTC where they earned a lot off before are extremely low and competition is coming up they could run out of cash while they have a huge stack of BCH laying around.
Two of the unidentified wallets disappeared and two other big ones popped up (probably the same entities) and one of them is already selling. Since the BCH volume is extremely low and there are no BCH over the counter markets big sellers can influence the price hugely (sell of 30.000 BTC was able to crash the Bitcoin market 75%, while the volume of BTC is way bigger).
After the last manipulation spike, the Bcash price is sliding down over the last months
What could happen?
Actually there are three likely scenario’s, lets start positive:
The tide in the BTC market could turn and a new bull market could pull BCH out of the terrible situation. Miners earn more and don't have to sell any BCH to fund their operations and fees of BTC will go up again what increases the income of the miners. The miners can keep hoarding BCH and use other income sources to pump the price. The biggest risk is avoided for now, but of course it will remain a big risk that a few entities own so much.
The bear market remains or the price goes side ways for a while and the miners have to sell the miner reward to cover their expenses. This will put downward pressure on the price and make it slide even further.
The bear market remains or the price goes side ways and these miners have to start selling their BCH stack because they need to cover their expenses or they want to exit BCH to avoid further losses (first out will lose least). As soon as traders see the coins in these addresses move they start to dump and open short positions. This scenario would be devastating and could even be the end of Bcash………And it is not even an unlikely scenario……
The 3rd scenario really has the potential to destroy Bcash
The article is a really in dept, you can see that the writer did his work to investigate this case very well, MUST READ:
https://medium.com/@btcWolves/bch-heading-towards-the-abyss-f1b2b9ec41f1
My view on this situation
Firstly, if I still had some Bcash I would sell it immediately, because this is a HUGE risk. The 160k bitcoins that are still in the wallet of the Bearwhale in BTC is worrying me a bit, but between 600k and 1.3 million coins in a cryptocurrency with a way lower volume and no over the counter markets can really be the end.
From the beginning I found Bcash a scam, because they try to hijack the brand name of Bitcoin and miners are abusing users to enrich themselves. When this bear market was underway I saw some big advantages. Exchanges started to do good things like implementing Segwit and badging transactions to stay competitive.
Another huge advantage was that a scam like Bitconnect finally got eliminated. When the scam Bcash also finally dies the crisis did it’s work and we can start clean with a new cycle where huge gains are to be made for the REAL innovative projects without lies, scams and misinformation from inside the crypto community! Bearish for Bcash but bullish for Bitcoin!
Disclaimer:
This is no trading advice, just my view on the current markets. Nobody can foresee the future so trading on these expectations is risky. Everyone is responsible for his own trade!
My last article:
https://steemit.com/bitcoin/@michiel/want-to-invest-in-cryptocurrencies-start-with-bitcoin
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What's the next course of action
I am not giving investment advice, but I dumped all my BCH that I got after the fork and bought BTC and some LTC with it. Especially the launch of Lightning main net today makes these coins extremely bullish
Wow that's amazing at least it's safe... I think I'll follow suit thanks
Good points man so i'm gonna search more info to sell all my bch or 50% more or less. Regards
Thank you! Do your own research and make smart decisions!
It really worth for my trading @michiel,,, thanks for sharing,,,
As my appreciation I've vote yours
Happy to share! I see BCH as a real treat to the reputation of cryptocurrencies as a whole and want to inform people about it.
Most of crypto drop sharply,, it maybe effect of central bank of several countries banned for cryptocurrency.
I don't know what will hapen with bch? sir should we hold bch or sell it? advice please.
I don't give advise on how to trade, but just my view. In my opinion the value of BCH is driven on fake hype and LTC is a way better coin for daily payments (more used, longer track record and cheaper). Beside that I think that Bitcoin is way better in everything, except for the high fees that was the case for a while, but (temporarily ?) resolved now. The only advice I can give is: Do your own research and use multiple sources, the best thing will be obvious.
thank you sir.
BCH is the only coin I've lost money on. FOMO got the best of me. Marketing hype never led to realistic traction.
Yes, rich guys like Roger Ver and Jihan Wu manipulated the price several times and created FOMO by the public. This means that these guys filled their pockets with money of the FOMO victims, so enriched themselves over the back of others. This is exactly the reason that I call BCH a scam. The coin itself is not a scam, but the marketing around it (lying and manipulating the markets). I really hope after Bitconnect this scam also have to close it's doors soon. Let the 3rd scenario as described above happen!
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Come after every hour and play as much you play as much you earn
Good Luck
when there is huge risk involved it is better to sell .
bitcoin is more promising
Yes, I think there are so many risks in BCH at the moment, only one have to play out.......
@michiel Posts are very useful for steemians, continue to share knowledge and experience of friends, thank you very much for your concern.
https://freebitco.in/?r=10689239 (for free BitCoin)
http://freedoge.co.in/?r=1178803 (for free DogeCoin)
Come after every hour and play as much you play as much you earn
Good Luck
i will stick to bitcoin core
I will never forget a sentence that I heard when I was entering the crypto world, said by a guy who become millionaire thanks to BTC: "BCH is better than BTC and in 5 years will surpass it (...)"
At the time I believed him in the possibility of BCH taking out BTC in market cap, but considering all this "black" news, the hope is close to dead. Anyways, my point is, I think scenario 2 makes things interesting...