In the last few days, the price of Bitcoin has gone down by about 54%. Some people think that this bad performance can make people seek for altcoins as an alternative.
It is pathetic that Bitcoin’s performance last week did not last long and has now lost more than half of the value it got.
BitInfoCharts reveal that the average fee of Bitcoin reduced from $6.65 on May 20 to $3.07 on May 25, accounting for more than 50% loss. For some time, the fee remained at $3.91 but that also did not last so long as Bitcoin’s fee is now at $1.65
Hayden Otto, a supporter of Bitcoin Cash, believes that if this situation persists, people will begin to pick interest in altcoins just like what happened in 2017. He said:
“When BTC is operating at capacity with a huge black log of transactions, it will slowly [lose users to altcoins] again. […] I’m sure most people trying to move funds around would convert to another coin before withdrawing from exchanges.”
Altcoins Take Advantage of Bitcoins Congestion
Otto, the founder of BitcoinBCH.com, is of the opinion that Bitcoin’s congestion increased its fees and users had to choose other options which led to the fall in demand and price.
Before Bitcoin’s halving in the early days of May, many people were speculative of what would become of the Bitcoin blockchain so some fled away. Otto thinks that this has contributed partly to the misfortune Bitcoin is facing right now.
Otto is, however, optimistic that Bitcoin will bounce back soon as he looks at the improvement in the number of unconfirmed transactions in the mempool. He noted that it has improved from 80,000 to nearly 20,000.
Miners also now find it less difficult to mine Bitcoins. Otto’s conviction that Bitcoin will soon regain its lost value is also based on this fact and adds that it will reduce congestion on the network. He believes that more than one adjustment would be required to stabilize things:
“We have already had one difficulty adjustment since the halving but it will take another one or two adjustments until it settles. Due to a decline in hash rate, blocks are being produced slower. BTC’s hash rate has dropped nearly 30% since the halving and the difficulty only lowered by 6%, thus difficulty will need to decrease further before blocks are mined at 10 minute average intervals.”