The key to making profitable crypto investments is to know and understand the coins you buy.
This you can do by doing your own research (DYOR) and seeking answers to these and more questions:
What is the coin all about?
Who are those behind its development?
What solutions does it offer?
How is it different from others?
How strong is the community?
What is its tokenomics?
What are its use cases?
Does it have a roadmap?
Are there active developers to sustain their development plans?
How secure is the network?
Yes! That's a lot of questions to get answers to. And if your money is important to you, you will DYOR.
In this post, we're going to analyse the BCH coin and see if it's a potentially good investment for you right now.
As well as project what the price could be in the next 1 to 5 years to come.
So without much ado, let's get started.
Bitcoin Cash (BCH) is a cryptocurrency that forked from Bitcoin on August 1, 2017.
The coin was a result of a disagreement among the Bitcoin community over how to scale the network.
One side was in favour of scaling the network and the other was against it.
By scaling, we mean increasing the block size to accommodate more transactions.
Thus enabling the blockchain to handle higher transaction throughput. As well as reduce fees and accommodate more users.
Their aim was to make Bitcoin a truly peer-to-peer electronic cash according to the original vision of Satoshi Nakamoto as contained in the Bitcoin Whitepaper.
The side in favour of scaling the network is Bitcoin Cash (BCH) supporters.
And the side that decided not to scale the network is the Bitcoin (BTC) supporters.
This post is not about who was right or wrong. Both sides have their valid reasons and I am not here to judge or take sides.
Like Bitcoin, Bitcoin Cash (BCH) is a community-managed cryptocurrency project. With independent developers and development teams contributing to the public code.
But the real instigators and original founding members of BCH were the community members like ftrader, deadalnix, singularity87, the BU crew, the Electron Cash crew (Calin Culianu, kyuupichan, Jonald Fyookball, etc.) and the many others. ~source.
Currently, as at the time of writing this post, BCH has 6 active full nodes, each with its own team of developers actively contributing to the development of the project.
Looking at their Gitlab repository, there are a total of 17 contributors, excluding individual developers working with the 6 active full nodes and other freelance developers.
So it's a little difficult to say the exact actual number of developers working on the project, but you get the idea. But we know there are at least 17.
More so, the project has a very tight-knit community of very loyal supporters.
People who believe in using BCH as a world currency for both micro and large payments. And wants to make it a true peer-to-peer electronic cash, suitable for instant and low-cost payments.
Their Reddit community is 359,000 members strong and over 20 different unofficial Telegram groups managed by community members.
Being a fork of Bitcoin, BCH has the same maximum supply of 21,000,000 coins like Bitcoin.
And new coins are only released into the market through the process of mining.
As at the time of writing this post, 18,624,474 BCH coins are in circulation.
Making only 2,375,526 BCH left for miners to produce until all 21 million comes into existence.
So there are only two main ways to get BCH. Either you mine it or buy it on exchanges.
You can also get it by accepting it as a payment currency or free via tips or gifts and faucet claims.
The primary use of Bitcoin Cash (BCH) is as a "peer-to-peer electronic cash".
To be a global currency of payments for goods and services.
A decentralized digital cash that's not controlled by any single entity or government. In light of the vision of Satoshi Nakamoto for Bitcoin. A vision which the BCH community believes the Bitcoin community no longer pursues.
This it does by allowing for increased transaction speed and low transaction fees. Making BCH suitable for micro, instant and low-cost payments.
The community is also building smart contracts capability for Bitcoin Cash. If this becomes successful, we will see BCH usage expand to include being used as gas covering transaction fees on the network.
Similar to what Ether (ETH) and Binance Coin (BNB) are to Ethereum and Binance Smart Chain respectively.
This has the potential to increase the coin's value and price much higher should it be successful.
Like Bitcoin, the Bitcoin Cash network is controlled by decentralized teams.
Thus, there is no central roadmap as each of the development teams is working on their own goals and plans and once agreed upon by the community, gets implemented.
But there is a lot of information on the various proposals that are either under discussion, development or completed which is available on CoinDance.
Some of the cool proposals currently under development as available on CoinDance include but not limited to:
Double spend proof creation and forwarding: An Update to inform other nodes of double-spend attempts immediately.
Increase unconfirmed ancestor limit: An improvement to enable faster spending off of your balance after a previous transaction from 25 transactions to up to 500.
Reusable Payment Addresses: To create a reusable address format.
Storm: An update to achieve instant transaction confirmations.
Modified fee structure: To reduce transaction fees by an order of magnitude.
OpenCAP alias protocol: A protocol establishing standards by which cryptocurrency wallets can communicate with servers to relate aliases to cryptocurrency addresses.
Maxblocksize Based on Median Block Size: To create a self-adjusting (increasing) block sizes that will make it unlikely for blocks to ever go full, even at load peaks.
BUIP087 nomenclature for 1/1,000,000 BCH: An improvement to call 1/1,000,000 of BCH as "bitcash" instead of just "bit".
The security of a blockchain network is determined by the number of independent miners that controls it hashpower.
The amount of hashpower an individual or group of miners control determines how much control they can exact on the network.
The ideal situation is to have as many miners or mining pools as possible, each controlling as little hashpower as possible on the network.
Another point to note about a blockchain security os the geopolitical diversity of hashpower.
Because if the hashpower is concentrated in a single political jurisdiction, miners can be coerced by powerful actors to relinquish control or combine their resources to perform a 51% attack on the network.
A 51% attack is a situation where someone or group of people controls more than 50% of the network mining power/hash rate.
Which gives them the power to manipulate the blockchain data for their own benefits
It is difficult to have the exact number of miners on any blockchain. As some miners are known and others are not.
On the Bitcoin Cash network, about 18 "known mining pools" are identified in the last 7 days according to data on CoinDance.
These 18 pools account for more than 97% of the network's mining power in the past 7 days.
Note that this does not indicate the total number of miners on the network. As the number of miners and their hashpower is not visible to anyone but the pool operators who have data about their miners.
Thus it's impossible to say the exact number of miners but we know how much hashpower all miners in each mining pool collectively control.
To put things in perspective, there're 21 known mining pools identified within the same past 7 days on the Bitcoin network that controls a little over 95 of the network's mining power, according to BTC.com Pools Stats.
Additionally, according to CoinDance, there are currently about 1293 public nodes on the Bitcoin Cash network.
Nodes are computers running the Bitcoin Cash blockchain network software and their job is to verify that the blocks produced by miners are valid and follows the rules of the network.
Again, more nodes mean greater decentralization.
And to put things in perspective, there are over 9,700 public nodes currently running on the Bitcoin network, according to BitNodes.
So the answer to our original question. Do all these mean the Bitcoin Cash network is secure?
As long as no individual miner or pool controls more than 50% of the network's hashpower, it can be said to be secure. And to a large extent, reasonably decentralized.
What will the price of Bitcoin Cash (BCH) be by the end of 2021 through 2025?
They say cryptocurrency price predictions are at best an educated guess. And that's not too far from the truth.
Because it's actually nearly impossible to say with any level of certainty, what the price of a cryptocurrency will be in the future.
But we can use available information to try and deduce a probable future price, which, all things being equal, can be fairly relatable.
On December 20, 2017, BCH reached its current ATH (all-time high) price of $3,785.82.
From the current price of about $500, it will take a 657% price increase to get back to ATH.
Can BCH achieve this price target by the end of 2021?
Most likely not, but a 100% from the current price to $1,000 by December 2021 is doable. If the current bull run is sustained.
But if the market generally loses momentum, I don't see BCH going beyond it's latest local high of sub $700. As most of the price action is being driven by pure speculation.
But it will become more interesting when the proposals under development are activated.
Most especially the; smart contracts capability, increased mempool size, and lower transaction fee which all increases the useability of BCH.
Adding to all that is a potential increase in mass adoption as several of the community members are making efforts to push adoption across various countries.
And platforms such as read.cash.cash and noise.cash are exposing more people to the coin.
Take me for an example.
Before now I had no business with BCH. But since I joined read.cash my exposure to and understanding of the project is enhanced.
And I now feel comfortable writing about it and even using and promoting it.
And if you think about it, there are many others like me.
So, depending on the state of the entire market, these developments can send BCH past $3,500 in 2022 and over $5,000 by 2025.
So here's my conservative price prediction for BCH for 2021 to 2025.
This is based on the assumption that the potential price increase will be driven mostly by fundamentals.
Bitcoin Cash (BCH) price prediction 2021 = $1,000
Bitcoin Cash (BCH) price prediction 2022 = $2,500
Bitcoin Cash (BCH) price prediction 2023 = $3,500
Bitcoin Cash (BCH) price prediction 2024 = $4,000
Bitcoin Cash (BCH) price prediction 2025 = $5,000
There you have it. I hope I am right, come December 2021 to start with.
More so, if BCH should have a similar growth pattern as Bitcoin, the price would be in the range of $30,000 to $50,000 by 2028 to 2030.
As of 2013, Bitcoin had about 30,000 active addresses per day. according to this chart.
Since then and now, the price of Bitcoin has increased by 1000 times (1000X).
To put things in perspective, when Bitcoin had 30,000 daily users and was about 4 years old if you had bought $1000 worth of Bitcoin then and held onto it until today, you would now have about $1,000,000. Not shabby at all, for an 8-year investment.
Ok! so how does this relate to Bitcoin Cash (BCH)?
Currently, Bitcoin Cash (BCH) has around 30,000 active addresses per day and it is 3.5 years old.
So if its growth pattern even closely resembles that of Bitcoin, BCH at $30,000 to $50,000 in the next 8 to 10 years is feasible.
This analogy was borrowed from a member of the noise.cash team here.
Bitcoin Cash (BCH), though very controversial has a lot of developments going on.
But its mass adoption drive is only beginning to take off.
As different projects such as read.cash and noise.cash are exposing more people to the coin.
And several initiatives are ongoing to take BCH to the masses and increase the number of merchants accepting the coin.
Besides the many cool features and functionalities, they're building. One of the things I am eagerly looking forward to is their smart contracts functionality.
And how that will compete with the likes of Ethereum, BSC, Polkadot, Cardano, etc. and take its own space in the DeFi ecosystem.
Interestingly, despite all its woes, BCH has maintained its top 10 positions for almost forever.
And it is currently poised to displace LTC and XRP to become the 4th largest cryptocurrency by market capitalisation in 2021.
There have been many price predictions for BCH this year already and mine will certainly not be first or the last.
But if you feel I am too conservative or even too optimistic with my predictions, then I invite you to check out @MarcDeMesel maths-backed price prediction for BCH, BTC, ETH and the entire crypto marketcap.
Which puts 1 BCH at $30,000, BTC at $100,000, ETH at $10,000 and the entire crypto marketcap at $6 trillion by the end of 2021.
What do you think about BCH as part of your portfolio? What do you think will be the price of the coin in the next 1 to 10 years? Share with us in the comments section below.
...and you will also help the author collect more tips.