The market value has been overtaken by "Lite Silver". What stories can the "Prince" BCH tell?

Original title: "Lite Silver" counterattacks "Prince" BCH

The mainstream crypto assets have started to rise one after another, and the price of BCH after the fork has not responded much.

On November 16 and 17, Litecoin (LTC) rose from a high of $61 to $75.7, a 24% increase, surpassing BCH in market value to rank sixth. During the same period, BCH finally rebounded after the fork, rising from a high of $235 to $250.5, but the increase was only 6%.

On November 15, the BitcoinCash (BCH) network just completed a hard fork, and the consensus of this encrypted cash network derived from BTC was split again. This was because the core development team ABC asked miners to transfer 8% of their income as a development fund, which was opposed by the community, so another development team NODE set up its own business.

The reason why BCH encountered obstacles in its development is not just the fork. When stablecoins became the main medium of value exchange in the crypto asset market, the value of BCH as a special currency was squeezed; the exploration of smart contracts was bumpy, and one of the main forces, the Copernicus team, ended without success; the BCH development team also encountered problems such as insufficient funds, which led to the plan to let miners contribute part of the income.

Today, LTC, which has always been regarded as the "silver of Litecoin", has exploded with Bitcoin; the exchange rate between BCH, which was born from the fork of BTC, and Bitcoin has fallen to a historical low. BCH, once known as the "prince" of Bitcoin, has seen its value diluted with repeated forks.

The "currency" route is difficult to follow, and the road to smart contracts is bumpy. After the fork, what story can BCH tell? It is reported that a decentralized non-custodial futures trading platform is being tested on the BCH network.

LTC's market value surpasses BCH

On November 17, Litecoin (LTC) surpassed BCH in market value and ranked sixth. Coingecko data showed that as of 1 p.m., LTC's market value was $4.85 billion and BCH's market value was $4.66 billion.

On November 16 and 17, LTC rose continuously, with the highest increase exceeding 20%. On the day of the rise on November 16, Charlie Lee, the founder of Litecoin, sent an emoji tweet with simple content, consisting of only a few pictures of roosters, dolphins, bees, and banknotes, followed by an English icon of "Soon".

Li Qiwei's tweet was interpreted as "LTC will soon surpass BCH"

This tweet by Charlie Lee was interpreted by cryptocurrency players as "implying that LTC will soon surpass BCH" - "The chicken represents Litecoin (the chicken is also his avatar, used in various Litecoin occasions), the dolphin represents Flip (Dolphin Flip), the English word Bee is a homophone of B, and the banknote represents Cash. Put together, it means Litecoin Flip Bitcoin Cash Soon, which means Litecoin will soon surpass BCH."

The market performance seems to confirm the netizens’ inference. On the 16th, LTC rose from $61 to $71.6, with a daily maximum increase of 16%. As of November 17, LTC reached a high of $75.7, a 24% increase compared to the previous day’s low.

At the same time, BCH rose from $235 to $20.5, an increase of only 6%. The day before that, on November 15, BCH had just completed a hard fork.

Grayscale, an institutional player in crypto assets, is also optimistic about LTC. On November 17, the asset management scale of Grayscale's LTC trust fund had reached 53 million US dollars, while the asset management scale of its BCH trust fund was 45.8 million US dollars.

In fact, the mainnet directions of LTC and BCH are similar. Both were originally created to solve the inefficiency of the Bitcoin network. In terms of application scenarios, LTC and BCH both follow Bitcoin in the "electronic cash" route. However, at present, in addition to playing the role of encrypted value storage and ideal payment scenarios, the mainnets of the two do not have a wider range of landing application scenarios.

Before the birth of Ethereum ETH and BCH, LTC was the mainstream cryptocurrency second only to BTC, and was known as "Bitcoin gold, Litecoin silver" in the currency circle; after BCH forked from BTC, investors dubbed it the "Prince" of Bitcoin.

When Litecoin followed Bitcoin Gold, supporters of the “Prince” were a little anxious. One investor asked, “LTC has already increased by 20% in one day, and now you are telling me that there is no problem with the BCH bull market?”

Indeed, when Bitcoin led the market to rise recently, BCH's market always lagged behind other mainstream crypto assets. Since breaking through $500 at the end of last year under the hype of the halving, BCH has been hovering at a low level.

According to Feixiaohao, as of November 17, BTC and ETH have risen by 96% and 256% respectively this year, LTC has increased by 76%, XRP has increased by 56%, and BCH has increased by only 21%.

The “currency” route that is not feasible

BCH has been stumbling along the way, due to the fact that its main encrypted cash payment scenario cannot be implemented on a large scale, and its exploration of smart contracts is not going smoothly. The former problem has not been solved even by Bitcoin, which has the most widespread consensus, and the latter market has been occupied by Ethereum.

BCH wants to be widely used as a "currency" in real life, but it seems far-fetched at present. Since Facebook took the lead in Libra last year, central banks of various countries have been promoting legal digital currencies, and the state endorsement is the hard truth of currency. Among them, the digital RMB DCEP launched by the People's Bank of China has been piloted in some areas of Shenzhen in October this year, and the amendment emphasizes the legal status of the RMB.

If the value exchange intermediary function of "currency" is only placed in the encrypted asset market, BCH's situation will be equally embarrassing, and stablecoins will be more popular assets among users.

Since last year, the stablecoin market has entered a diversified period. Not only USDT has the first-mover advantage, but also USDC, which is issued in compliance with regulations. With the outbreak of DeFi this year, decentralized stablecoins such as DAI have also become popular. The scale of the stablecoin market continues to expand. According to DAppTotal data, after the "3.12" incident this year, the total market value of stablecoins has soared nearly 4 times, from US$6 billion to US$23.4 billion, which is approximately equal to the market value of 5 BCH.

Whether in the real world or the crypto world, BCH, which takes the "currency" route, is not popular, and LTC faces the same situation.

The number of BCH holding addresses dropped by 200,000 in half a year

Judging from the scale of holdings, BCH is not optimistic either. The number of addresses holding the currency has begun to decline since the Bitcoin halving in May this year.

OKlink data shows that on May 10 this year, the number of BCH holding addresses was 1.788 million. As of November 17, it dropped to 1.58 million, with a loss of nearly 200,000 addresses; the number of LTC holding addresses also dropped from 3.17 million to 2.61 million.

The number of addresses holding BCH is decreasing, perhaps because investors cannot see a future for BCH.

In addition to the "currency" route, the BCH network has explored smart contracts. In 2018, the Copernicus team, supported by Bitmain, began to lead the development of the underlying smart contracts on the BCH network, intending to transform BCH into a public chain that can build smart contracts like Ethereum, and also launched a "Wormhole Protocol" that can issue tokens.

But in 2019, the financial sponsor Bitmain fell into internal strife at the top level, and the Copernicus team was almost disbanded. Although other teams have been exploring the construction of smart contracts since then, insufficient funds and manpower have ultimately brought BCH's transformation to a standstill.

"No money" is a major pain point in development and one of the reasons why BCH split again after the BSV fork.

In February this year, the core development team of BCH, ABC, proposed in a financial plan that miners should share 8% of their income with the technical development team as a development fund. This move caused strong controversy in the overseas community, and the NODE team led by developer Freetrader chose to "start their own business" and build a BCH network that does not include this plan, which is no longer compatible with the network version developed by ABC.

Not all community members will choose to support the fork. Roger Ver, a BCH supporter and founder of Bitcoin.com, said in an interview before the fork, "If PayPal knew that a controversial hard fork like BCH might happen, perhaps they would not have added BCH to their roadmap at all."

The fork finally occurred on November 15, which once again weakened the consensus of BCH.

BCH tells the smart contract "story" again

Compared with the computing power war between BCHABC and BCHSV that shocked the industry in 2018, this year's hard fork is no longer as fierce as the life-and-death war of the past. The BCH ABC team even publicly stated that it will continue to maintain the BCHN node after the fork.

The NODE development version eventually won the naming rights of BCH. Coingecko data shows that as of 2:00 p.m. on November 17, the price of BCHA was $18.8; at the same time, the price of BCH was $251, 13.3 times that of BCHA.

Although BCH has retained its name, its status as the "crown prince" is no longer as valuable as it was two years ago. After Bitcoin broke through $16,000, the exchange rate between BCH and BTC hit a new low this month. OKEx market data shows that on November 17, the exchange rate between BCH and BTC fell to 0.0146.

BCH and BTC exchange rate hit a new low

As of November 17, Coingecko data showed that the total market value of the crypto asset market was $483.7 billion, of which BTC accounted for 63.9%, ETH accounted for 10.9%, and USDT accounted for 3.07%. The leading position of the coin king is still stable, and BCH, with a market value of $4.63 billion, accounts for only 0.9%. On the road to catching up with the "real Bitcoin", it has been left far behind by BTC.

If BCH is considered a hype asset, its low point may not necessarily be a bad thing.

Jiang Zhuoer, a die-hard fan of BCH and founder of Litecoin Mining Pool, predicted that a new round of users will flood into the cryptocurrency circle with the news of Bitcoin’s repeated record highs, but most of them will not buy Bitcoin, “because it is too expensive, and Bitcoin has already reached ATH (All time high). It is better to buy those mainstream coins and altcoins with smaller market caps, more stories, and higher multiples of growth. Therefore, the growth of LTC, BCH and other currencies will leave Bitcoin far behind.”

The "story" followed closely. On November 16, Johnathan Silverblood, a BCH community developer, published a post revealing that AnyHedge, a BCH-based smart contract developed by their team, will be launched soon. It is a decentralized non-custodial futures trading platform. "As for the product itself, we have completed the development, and AnyHedge will soon complete the testing phase."

It is reported that this product was put into development in the first half of 2019, and it took two years to enter the online testing phase. On Ethereum, various DeFi applications can be seen everywhere.