Before the Bitcoin Gold fork two days ago, the market made some interesting moves.
Bitcoin price hit a new all time record Oct. 20, 2017 – five days before the Bitcoin Gold fork – for the first time, for the first time and up to $ 6,200.
Those of you who have already lived through cracks are aware of what usually happens when there is a split in the Bitcoin network. Usually the community complains, reddit.com, medium.com, and twitter.com become platforms for soap box speeches, and a lot of trash is discussed by factions within the community.
However, did you notice the other? events that are correlated with a share chain? Once a chain separates, you suddenly have a number of split tokens equivalent to the number of chips you had on the Bitcoin network. This is because the new chain will be an exact copy of the Bitcoin Blockchain until the fork will occur.
If the wallet you are using supports the forked chain software, you will be the owner of two digital tokens: Bitcoin and the Forked chain token. In our example, we will use Bitcoin Cash (BCH) as a forked token. When the Bitcoin Cash chain is separated from the main channel, Bitcoin owners have become owners of an equivalent amount of Bitcoin Cash. This is because the chains were identical until the appearance of the fork. If you had 10 BTC before the split, you had 10 BTC and 10 BCH after the split.
This is where the slope becomes slippery. People or organizations whose money amounts are unfathomable can use the ranges as an opportunity to extort the Bitcoin network and the forked network to attract capital gains when a range occurs.
Preparation of the Branch
say that Randy owns 35,000 Bitcoins; worth $ 5,000 per bitcoin, Randy's digital assets are worth $ 175,000,000. Just like anyone who invests a lot in a market, Randy pays attention to information that could affect his position in this market. Randy learns that there will be a hardfork in the Bitcoin network and that the hardfork will create a new token, Bitcoin Cash (BCH).
On top of that, Randy learns that his Bitcoin wallet provider will support the software forked, so he knows that he will own Bitcoin Cash as well as Bitcoin once the fork occurs. Now, Randy expects to have 35,000 Bitcoin Cash chips in addition to his 35,000 BTCs after the fork. If Randy were to increase his position by millions of US dollars of Bitcoin, he would be the owner of more Bitcoin than he had previously.
However, it would also create a wall of purchase that would drive up the Bitcoin price since it is a major player in the Bitcoin market. When Randy increases the amount of Bitcoin that he owns, he also increases the amount of Bitcoin Cash that he will own once the range occurs.
Because Randy is an educated investor, Randy decides to increase his position in Bitcoin so that he owns 50,000 Bitcoin the day before the pitchfork. Randy did it because he would like to own even more Bitcoin Cash than the 35,000 that he would have had if he had not increased his position in Bitcoin. Now, when the bifurcation occurs, Randy expects to have 50 000 BCH in addition to his 50 000 BTC
What happens when a chain
] When the Bitcoin network branches off, part of the Bitcoin network value splits into a forked chain. When Bitcoin Cash came from the Bitcoin network, Bitcoin's value went from $ 2800 to $ 2700 (July 23, 2017).