- Jul 24, 2021
Bitcoin Cash (BCH), world’s apex cryptocurrency Bitcoin (BTC) initially took off last August and promised to fix BTC’s soaring transaction service fees and make cryptocurrencies a viable alternative for each day transfers once again but it’s so intended purpose doesn’t seem to be in much use.
A blockchain intelligence firm Chainalysis that investigates cryptocurrency money laundering, scam, and observance violations, came forth suggesting that most cryptocurrency enthusiasts still use BCH for investment purposes a lot more regularly rather than for transactions. It is also well-known for helping discover the Mt.Gox theft as well.
Chainalysis on June 8 revealed that 90 percent of Bitcoin Cash holdings are held as investments and never change hands, indeed the amount of BCH held in wallets is 10 times higher than the number of times BCH is used in transactions.
As Chainalysis reports- “1.5 million bitcoin cash is held for speculation and transactions compared to 7.3 million bitcoin, the ratio of transactional to investment coins in bitcoin is 1:1, while the ratio for bitcoin cash is 1:10.”
Bitcoin Cash is as an ‘alternative’ to Bitcoin which gives users easy and cheaper transactional capabilities. The new research claims that as it is a new controversial altcoin, users don’t prefer to transact in it.
As for the vivid research purpose, Chainalysis has divided the total supply of Bitcoin and Bitcoin Cash into ‘monetary aggregates’ that based on liquidity measures the money supply in a financial system. The four categories are speculative coins, service transactional coins, investment coins, and lost and unmined coins.
Further studies by researchers note that only 1.5 million BCH coins to be held for speculation and transactions, the rest being in long-term investments. It is also found that the amount of Bitcoin Cash used for transactions has declined since it forked off from the Bitcoin network “from 15% in November 2017 to 7% in April 2018” – according to the researchers, while the amount of Bitcoin held by speculators has, in fact, increased.