CoinMetrics latest report: After the halving of BCH and BSV, miners will allocate more computing power to BTC in a short period of time

BCH and BSV will halve on April 8 and April 9 respectively, which has aroused the curiosity of many traders. There are many people speculating on what impact their halving will have on the price of Bitcoin. Recently, crypto strategist Tone Vays said that BSV is completely irrelevant and will not have any impact on Bitcoin. After the halving, BCH can increase the computing power of Bitcoin by one or two percentage points.

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CoinMetrics’ latest report also argues that the upcoming BCH and BSV halvings will exacerbate the current struggles faced by miners, as miners are in a state of capitulation, even before the May halving.

Source: coinmetrics

As shown in the chart, Bitcoin's hashrate has been growing compared to February 13. As of April 5, Bitcoin's hashrate was 114.485E. As Vays pointed out, if BCH's halving leads to an increase in BTC's hashrate, that could be good news for miners. The report also pointed out that with the halving of BCH and BSV, the miner-led selling pressure generated during the big crash may continue to increase.

Furthermore, since all three assets use the same “SHA-256” mining algorithm, miners can redirect their hashrate to the asset that offers the highest return on investment. The report further stated,

“When BCH and BSV halve their block rewards, this will force miners to allocate more computing power to Bitcoin, which still has 12.5 BTC block rewards at this time, and there is about a month before it is reduced to 6.25 BTC. Therefore, we should expect Bitcoin’s mining difficulty to increase, which will further compress the profit margins of all miners.”

At the same time, many altcoins outperform BTC in terms of transaction speed, scalability, and reasonable transaction fees. The Bitcoin ecosystem has long been eyeing the Lightning Network as a solution to all its shortcomings. The Lightning Network is thought to allow smaller Bitcoin payments to be sent faster and at a lower cost.

In fact, Litecoin’s Charlie Lee recently argued that the Lightning Network could help solve Bitcoin’s scalability and other issues.

However, Vays believes that Bitcoin is powerful enough even without the help of the Lightning Network, and that there is no need for the Lightning Network to provide anything other than increased privacy. He said,

“Bitcoin transactions are very cheap and very fast, so there really wasn’t a lot of demand for the Lightning Network, but the Lightning Network is getting stronger and stronger and slowly becoming more popular. When the technology is adopted, probably in a year or two, everyone will be comfortable with the Lightning Network because it will provide better privacy.”