The bitcoin offshoot surged Saturday to a record high in high trade volume, helped by strong demand from South Korea and digital currency “miners” who found the offshoot more profitable to mine.
Bitcoin cash, an alternative version of bitcoin launched by a minority of developers on Aug. 1, climbed 44 percent to $996.92, according to CoinMarketCap. That’s the highest bitcoin cash has ever traded in its less than three weeks of history, and a jump of almost 374 percent from its low of $210.38 on its first day of trading.
Bitcoin cash traded off that high at $944.45 in mid-morning trade, still less than a quarter of the original bitcoin’s price.
Bitcoin cash seven-day performance and trade volume
After stagnating interest in the first two weeks of its existence, the bitcoin offshoot began climbing late last week after digital currency “miners” on Wednesday mined an eight megabyte bitcoin cash block. That demonstrated bitcoin cash could fulfill its promise of faster transaction speeds, which is determined by block size. The original bitcoin has a one megabyte block size and is set for an upgrade to a two megabyte block this fall.
The gains in bitcoin cash’s price and built-in protocols that gradually reduce the difficulty of mining the digital currency have made the offshoot more attractive to miners. Bitcoin cash is now 69 percent more profitable to mine than the original bitcoin, according to data analysis from Coin Dance.
Digital currency miners often switch their mining power among different currencies depending on their relative profitability.
Relative profitability of bitcoin cash vs. bitcoin
Source: Coin Dance
Bitcoin cash’s 24-hour trade volume of nearly $4.4 billion topped bitcoin’s roughly $3.4 billion and that of another digital currency, ethereum, at $918 million, according to CoinMarketCap.
South Korean exchanges Bithumb, Coinone and Korbit dominated trade activity, with Bithumb alone accounting for $1.7 billion of trade volume, CoinMarketCap data showed. At the overnight peak, trade in the South Korean won contributed to nearly half of bitcoin cash trade volume, according to CryptoCompare. Trade in won for the original bitcoin accounted for only 10.5 percent, the site showed.
Investors in bitcoin at the time of the Aug. 1 split into bitcoin and bitcoin cash should have received an equivalent amount of the bitcoin offshoot. However, major digital currency storage and exchange site Coinbase plans to add support by Jan 1, 2018, after initially saying it would not support the alternative digital currency.
The original bitcoin traded about 0.6 percent lower near $4,133 after hitting a record high of $4,522.13 Thursday, according to Coin Desk. Bitcoin has more than quadrupled in value this year.
Ethereum, traded 2 percent lower to $290.01, still up more than 3,000 percent this year, according to CoinDesk.