Saturday, May 16, 2020

Return Of The Bitcoin Chain Death Spiral.

Bitcoin mining is an economic activity. Miners will stop mining if it is unprofitable. The only exception is mining on the BCH and BSV chain where the supporters are mining to support the chain and are basically holding on to the coin for future profits. This happened in the case of BSV when the coin increased in price from $45 to $190 today. Doing the same on BTC at $9000 is not that easy.

To maintain current price there has to be about $8 million a day of new investment into BTC.

The above is the result of 1TH of mining on Viabtc. Since the halving on 11 May it is mining at a loss. Before the halving, mining difficulty was to readjust over 6 days, but today 7 days later it is expected to take another 3 days. This slowing down is due to miners leaving the network.

BTC mining profitability through price increase.

We can use the chart above to calculate the required price increase to break even on mining at the 100 EH mining today. This is ( 849/749*9000) which is $10,241. Over the last week BTC price have exceeded $10,000 briefly only to fall back to the mid $9000. There does not seem to be enough support among bitcoin supporters.

BTC mining profitability through reduction in hashrate

A mining breakeven can also be achieve if another ( 100 - 749/849*100) 12 EH of miners leave the network. This is a sizeable amount as the total hashrate mining on the BCH amd BSV chain is only about 5 EH.

Inefficient miners will stop mining.

As of today there are still 103 EH mining on the BTC chain. The price of BTC has increased from $8500 to $9500 but the number of miners have only reduced slightly from 120. Less efficient independent miners in mining pools must soon stop mining after the next difficulty adjustment in 3 days if the price does not increase.

BTC chain is slowing down and this is dangerous

The average number of blocks mined a day is about 122 compared to the 144 expected. Surprisingly the mempool has not grown much. This means that there are not many backed up transactions waiting to be processed. BTC is not suffering from a glut in popularity.

Chain Death Spiral

The chain death spiral is the theory that the BTC chain will grind to a halt if miners exit the network suddenly. This is because BTC does not have an emergency difficulty adjustment mechanism as in BCH and BSV.  BTC chain has already slowed from 10 minutes a block to 12. The problem is that when the readjustment does take place in say 3 days from today there will not be much change in the difficulty and that will have to last another 2016 blocks which on current performance could take a month.

Between BTC price increasing and miners leaving the network, miners are more likely to leave the network. This will slow the network down even more and people will start to notice. Will a white knight emerge to prop up the price, leading to a bull market and saving BTC?

Thursday, May 14, 2020

BTC BCH BSV Miners Hashrate and Price

With BTC halving yesterday all three coins have halved and we can now expect that miners will be rational and mine profitably. Prior to halving BTC normally commands up to 98% of total hashrate. As of today (14/5/2020) this has reduced to 89% or 95 ExaHash and blocks found over the last 24 hours have reduced to 109 block from the standard of 144 blocks. 

Based on current prices BTC hashrate will decrease to 70% before mining equilibrium is achieved across all three chains. If this happens quickly and the hashrate drops to 84 ExaHash BTC chain will slow to a crawl. Unlike before miners who have left will not return to mine at a loss out of loyalty. Panic may set in when this becomes clear which will lead to a drop in price and we enter the dreaded Chain Death Spiral.

Drop In BTC Hashrate

Block Found in last 24 hours

Profitability Calculations.

What will inefficient BTC Miners do? 

Before Halving   11250  BTC  @ 9500 = $106.8 million =  $0.89 per Exahash (120 Exahash)
After Halving        5625 BTC  @9500  =  $53.4 million  =  $0.56 per Exahash  (95 Exahash )

BTC hashrate must reduce to 70 Exahashes to equate pre halving earning levels. It is currently 91 Exahashes (15/5/2020) . A reduction from 95 yesterday. Where will these miners go will they move to BCH and BSV or will they shut down altogether?

Can they move to BSV or BCH ?

5625 BSV @ 190 = $1.06 million = $0.75 million per Exahash ( 1% = 1.4 Exahash)

Since BTC halving the hashrate of BCH and BSV have increased to 3% and 2% respectively. However the miners who moved here will also be mining unprofitably as the price of BCH and BSV remained stagnant.

Since 11 May 50 Exahashes have been turned off. Only 87 Exahashes are left mining on BTC and it needs to decrease even more.  As a result the BTC chain is slowing down. The next difficulty adjustment is expected in 4 days and perhaps more if more miners stop mining. Even if it makes it to the next difficulty adjustment, the next difficulty is expected to increase from 16.1 T to 16.48 T !! This is a serious problem for the BTC chain.

This situation is fluid and developing. The BTC mempool is increasing fast.

It now cost over $5 to transact on the BTC chain. This situation will get worse. 

Why is the price of BCH ans BSV stagnant?

Since halving the price of BTC moved from $8700 to $9700 but the price of both BCH and BSV did not move in tandem. This can only mean that the supporters of each chain have remained steadfast. 

BTC supporters are unable to push the price past the required level of $14,000 at least. BSH and BSV supporters can remain where they are. Unless BTC supporters moved over to either of these two chains their prices will remain stagnant. The ball is in BTC supporters court. As the mempool bloats, and cost of transactions get ever higher, panic will set in.

Because BTC chain is slowing down, it is unlikely that BTC price will go any higher. If panic sets in BTC price will collapse.  At time of BTC halving it was expected that the next difficulty was to be readjusted in 6 days that has now passed and it is expected to take another 3 days. I suspect that it will be even longer possibly another 6 days. If this is true then the next difficulty adjustment could take as long as a month! Something will break before then.

BTC miners have been net selling mined coins since the halving

This graph from Byte Tree shows the net selling by BTC miners since the halving. 

Tuesday, April 14, 2020

After halving miners must morph into Transaction Processors

As I write this we are just a day past the BSV halving, two days past BCH halving, and another 30 days before BTC halving.

A note on crypto prices

Price changes in alts follows the price of  BTC because alts are  mainly paired against BTC on almost all exchanges. This will remain the case unless we can decouple from BTC.

One way that this can happen is to pair against Tether (USDT). As of today it has a marketcap of 6.5 billion, an increase of about 2.5 billion recently. However Tether will need a much higher marketcap in order to replace BTC.

Another is if a clear winner to emerge out of the BTC, BCH and BSV hash war.

Mining Economics

For the next 30 days most miners will mine the BTC chain. BCH and BSV chains will revert to their foundation miners for BCH and Coingeek for BSV.

Mining at a loss, hodling and waiting for the price to rise.

If the halving of BCH and BSV is any guide, BTC. will most likely maintain price prices on a bearish tone. This means that BTC mining will also be unprofitable.

It is unlikely that miners will continue to mine at a loss. Less efficient miners will have to leave until the difficulty adjusts for mining to be profitable again.

Some miners may decide to mine and hold until the price increases, but this is a risky proposition.

For BTC the Chain Death Spiral also threatens like "Democleas Sword".  BTC will be at maximum difficulty after halving, A huge drop in hashrate could trigger it.

Mining dynamics after BTC halving.

Opportunistic mining - On BCH and BTC difficulty is adjusted every block. Some miners will wait until the difficulty adjust low enough before they start mining on the chain. This is more noticeable on the BCH chain.

Price hodling - Miners leaving the BTC chain may choose to mine on BCH or BSV as the chance of these coins doubling will be higher because of it's lower prices.

Pick a winner - This will be hard to predict.

Transaction fee model - BSV wins as it is the only blockchain designed for this.

It is all about transactions

Bitcoin was designed for mining revenue to transition over to transaction fees. The halving in block subsidy was designed to incentivise this. It is incomprehensible how BTC supporters can ignore this simple reality? In the graph above we can clearly see that Fee percentage in blocks between BCH and BSV have diverge considerably after the halving. This trend will continue. BSV will continue to increase the number of transactions per block because it is designed for users to write data to the blocchain.

The major transaction volume on BSV are users writing weather data ( weathersv) and exchange data (preev) to the blockchain. However on the horizon are real enterprise users in supply chain management (unisot) (kowr) and medical data (EHR).

A new model for miners as transaction processors.

There will be a paradigm change. Miners need security of income in order to justify spending millions in hard and soft infrastructure. They will become transaction processors.

They will be able to contract with large enterprise users exclusively to process their transactions thus guaranteeing a reliable income stream. Such contracts will be hard to disrupt as a bond of trust will develop between the parties. It will also incentivise the miner to improve their service in order to keep their customers.

Buy the dip sell the top

For BSV supporters, an opportunity exist to buy the dip and sell the top until BTC halving because it will be volatile. Risky, but if you can time it right, there is an opportunity to multiply your holdings. Use wallets like Exodus, Coinomi and move between BSV and USDT. Warning - It is risky and very difficult to time the bottom and the top and too easy to get emotionally involved. Only risk what you can afford to lose. Remember most people "can pick it but cannot time it".

BSV flipped BCH in January but could not maintain the lead. In all likelihood BSV will again flip BCH before BTC halving. If this happens look for BSV to moon and win the hash wars as miners chase profits.

Monday, April 6, 2020

Paymail is here!! This is the Killer App for BSV mass adoption

Imagine paying someone by just sending money to their personal email address. Yes you can. This is Paymail and it goes into Beta today. The caveat is that it only works with a domain name address.

How it works.

Your email is the gateway to your moneybutton account. ( Relayx, Handcash )

1) You will need an invite to join the beta and you can do that through this link

2) Upon approval you will be given a mypaymail account example :

3) Adding new handles

In addition to your assigned handle you can create more handles as on the left side of the form. Each handle will cost $0.85 cents. You can use any amount of payment destination you wish.

4) What is interesting is the custom domian option on the right side.

If you or your organisation uses a custom domain for your emails, those emails can be linked to your payment destination. This means that anybody can pay you by sending money to your email address not your mypaymail handle.

I reached out to mypaymail on the process and they responded with this message.

"What DNS service provider are you using? Could you send me a screenshot of your zone editor?"

If you have a DNS provider that you have to pay for you can use the zone editor to enter the details.


There is an easier way to set up the DNS records but it only works with currently. So if you buy a domain from them, an autoconfiguration button appears and it will edit the DNS recods for you. 
also interesting is 

"We are not far from getting Godaddy support, hopefully I will hear from them this week."

This is a huge development for BSV. You can actually pay a real active email address!! 

But!!! Yes there is a but........

"Unfortunately, Gmail does not support Paymail, so we cannot use Gmail Paymails. But you can buy a domain, create a Paymail and start using it. Later, if you want to use the same Paymail as your email address, you can buy a GSuite or Office 365 package."

Unfortunately you have to pay for the service.

So, If I send some money to someones email address will he be able to set up moneybutton and receive that money?

"Currently, the Paymail account needs to exist when your wallet makes the payment. Otherwise, your wallet will return an error. The way to send money to an email address today is to create a wallet and then register a Paymail that matches your email address using a custom domain.

The idea of sending a payment to someone that does not have a Paymail account but has an email address is quite interesting. Also free email accounts are key, as you say. We will be trying to come up with innovative ways to address these issues in the medium term."

What about a smart contract? I link my friends email to a moneybutton account. This allows me to send to his email. He then has to create his own moneybutton account and automatically receive the payment.

And their reply is most interesting

"I just had an idea similar to what you are describing. We need to implement a couple of features to make it possible but it think it is doable."


Yes this means that you can onboard all your friends by sending them money! How many people can refuse that. And if you make this viral with a referral incentive --- Kaboom! Moon Moon Moon.

A word of thanks to Pol Moreno Yeste @ mypaymail for his help.

Thursday, March 26, 2020

BTC is in trouble. Chain Death Spiral Looms. BSV Wins!

BTC hashrate dropped from 136 THs to 95 THs

Block difficulty just adjusted (26/3/2020) at block 622944

Latest block mined is 622986

Next difficulty adjustment is at 624960

Average block time for the last 2016 blocks was 11 minutes 54 secs

Current time to mine a block have reached 20 minutes. This loss of hashrate is serious and could result in the chain grinding to a halt.

What cause the loss of hashrate?

Economics! For some miners it has become unprofitable to mine and they are switching off their machines. All machines of the S9 generation will be unprofitable. The current economic climate and lock downs all over the world must also be a factor. I suppose it would be hard to convince the police that you have to go to work because bitcoin mining is an essential service.

Why is the price still holding?

There was a huge price collapse from $8000 to $5000 on 13 March and since then it has recovered to just over $6000. However it has been a phenomenon of selling the top. Whales are exiting!!


Most institutional investors would move out of crypto entirely until the scene settles. BCH and BSV do not suffer from hashrate gyrations because blocks adjust dynamically. However both will be undergoing halving in the next 14 days. The block subsidy will halve from 12.5 to 6.25. This is a 50% reduction in revenue if the price stays the same.

What will become obvious is that on BSV the income from transaction fees is increasing even reaching 50 coins yesterday. After halving only 900 coins will be mined per day. If this trend continues miners will start mining BSV as it will be much more profitable than mining BCH after the halving.

BTC is in trouble. It may finally succumb to the dreaded Chain Death Spiral.

Tuesday, February 25, 2020

How bad will be the economic impact from Covid 19.

The first case of Covid 19 was thought to be on 31st December. The belief was that the source was the wet market in Wuhan China, where because of the Chinese's penchant for consuming wild animals for heath reasons the virus jumped from animal to humans. Irony perhaps but very reasonable and believable that the virus jumped from bats to humans through an intermediate host thought to be snakes.

Fast forward and we have a paper published in the Lancet medical journal, about a new study by Chinese researchers claiming that the first case of Covid 19 was actually on 1 December. The person was elderly and lived several bus connections away from the Wuhan market. As he was sick he never visited the market.

We now know that the incubation period could be more than 14 days and that a person is contagious before showing any symptoms. Most will recover without showing any symptoms at all, and yet will be spreading the virus without ever knowing it. This was probably why the contagion was so widespread in Wuhan as it is so densely populated and infected people were spreading it around without knowing it.

The research was published in the Lancet which presumably will have been peer reviewed and is credible. If this is true then we still do not know the identity patient 0 and the source. They will probably discover this through DNA tracing but for now it remains a mystery.

Covid 19 is now with us for good, deal with it.

Quarantine is probably no longer a way to ward off this virus now. By its' nature of being contagious even before symptoms shows and even after recovery, there will be no way to prevent this virus from spreading to any country in the world. No country will be spared. It will only be a matter of time. The emphasis will have to move towards detecting and treatment until we have a vaccine.


The first thing is to identify it from the common flu. The PCR method of detecting takes over a day and is thus slow however a Mexican company have a machine that can detect the virus within 3 hours and the unit is mobile. On detection the said patients can then be treated as best as a country's health services can offer.


Fortunately for a majority of people (80%) will only experience mild or no symptoms. The virus does not seem to affect young children or even infants. Of those who show symptoms most will recover. The fatality rate is currently expected to be between 1 - 2 % or even lower. Better figures will be fort coming as we get better methods of detection.

One cure which seem to work is to use plasma donated by patients who have recovered. Another treatment that seem to work is an antiretroviral drug used to treat aids. A vaccine is on the way.

Covid 19 may not kill you but it can kill the economy and that may kill you.

For all the rage, Covid 19 is not as bad as we fear. The fear factor factor however will be devastating. Even in countries where there are no cases, the fear of contracting the disease will cause people to stay indoors. This is devastating for any service driven economy. This mentality and behavior will plunge any country into recession.

The best thing we can do is to stay calm and prepare.

Lancet medical journal report on BBC

Mexican Covid 19 detection

Plasma treatment covid 19

Antiretroviral Aids drug to treat Covid 19 cases

Saturday, February 22, 2020

The Coming Global Recession and BSV

Come Monday ( 24 Feb 2020 ) the whole world will believe that a global recession is upon us. The black swan event that triggers this change in sentiment and perception is Covid 19. We have all now seen the effects of this virus and the toll it has taken on the Chinese economy. What has happened in China will now be repeated worldwide. This is now a pandemic.

Covid 19 is a global pandemic.

The most significant revelation is that the virus is contagious 3 to 5 days after infection and the individual exhibits no symptoms until two weeks later if at all. Individuals have tested negative several times and only to test positive days later. The reason is that the Polymerase Chain Reacion (PCR) test that they use can only detect the virus if the viral load is "significant enough". Under this threshold the test will return a negative reading but the individual is contagious. This was what happened to the testing of health workers. This means that health workers who, presume are tested daily returning negative result but is contagious and infecting everyone they come across in their work until they tested positive.

With the virus spreading within the population two months before it was even identified as a new strain, the virus would have had the opportunity to spread worldwide. Like in China those who were sick outside of China would have assumed that they just had the flu until the world was alerted and they started testing for it.

It is too late. Covid 19 is with us like the common flu. The good news is that for the majority the effects are mild. As to how lethal the virus is, the jury is still out. The best estimate is 1 - 2 % and mostly among the weak and old.

Another interesting observation is that there could be several "flavours" of the virus and that a person can be reinfected with the reinfection being even more serious. This is a nightmare scenario if true. ( There are 4 strains of the Dengue fever virus and immunity from one does not apply to the other three )

World in recession.

GDP output in China is expected to be negative for January and February with the country in quarantine and shutdown. Being the second largest economy, a source for global tourism, investments and a major hub in the global supply chain the whole world is affected.

With this sentiment and perception dawning on the world economy, every country in the world will embark upon fiscal and monetary policies to dampen the effects of the oncoming recession.

Most central banks have been printing money ( monetary policy ) and the result was inflation in assets and stock market. The real economy was largely untouched because a deflationary cycle was occurring in the real economy with products being ever cheaper due to efficiencies, economies of scale and globalisation.

The tables are now turning. Come Monday we could see a crash in the stock market starting in Asia when we expect that company profits will be gravely affected. Money printing in this environment will not prop up the market which means that it may flow into the real economy pushing up inflation.

The problem is that most countries cannot afford inflation and rising interest rates. This only leaves the option of negative interest rates with ever increasing amount of money printing. The world will also be on the fast track to digital currencies as negative interest rates is ineffective without it. Without a digital economy negative interest rates will drive people to take their money out of the banking system.

Money printing and BSV

Money printing will not save the stock market but what about house prices? Presumably money printing in conjunction with negative interest rates should push up house prices. However in countries where house prices have been fueled by investments from China may see a reverse. With China going into inevitable recession the Chinese government may "request" that their citizens bring back money and investments that they have parked overseas.

We may see a movement of money into the crypto markets. This means huge increase in BTC and all cryptos.

Tie into this scenario nation states putting their national digital token on the BSV blockchain because it is the only public blockchain that can scale. This will lead to turmoil in the crypto market as well but BSV will come out the victor. When someone with the stature of Tom Lee from Fundstrat who clearly understands and warms towards BSV we can bet that behind the scenes positive things are happening for BSV.

BSV will emerge the winner

We may see everyone in crypto rejoicing in the short term but this will be short live. BSV will emerge the victor in the end.

Twetch will win. Your invitation to join Twetch

Twetch is Twitter on BSV. More than that it is Twitter monetised and permanently recorded on the BSV blockchain.

Why Twetch will win?

Older technology will be superseded by a newer technology if the new technology offers new features that are cheaper, faster, and/or better than the old.

Being cheaper and faster may not be the killer features to replace an entrench system but additional features that are useful and indispensable will. Monetisation on Twetch is this additional feature.

For Twitter, trolling is toxic. It kills user experience. Trolling is endemic because it is free. Putting an economic cost. even a fraction of a cent will bring the worst effects of trolling under control. Trolls cannot commercialise their business model on Twetch because it will be too expensive.

Putting your money where your mouth is. How true! When you have to put your money where your mouth is - You trend towards truth and honesty. Doing otherwise will cost you money.

Your invitation to join Twetch

Monday, February 10, 2020

Another spike in BSV price today!

"BSV jumps 17% out of nowhere" says one headline. It is actually greater than 25% really but the gist of the headline was it jumped 17% when all other cryptos were in bear mood. When BTC passed 10,000 the whole market of course rebounded including BSV.

Why did BTC pass 10K ?

My take is the slowing global economy prompted by the corona virus ( nCov ). The effects on commodity demand due to China shutdown is being felt. Oil has plunged 20% with little hope of it recovering in the next 2 quarters. The ramifications of this is huge as the price of oil affects highly leverage shale producers immediately and Saudi Arabia needs oil at $80 to balance its budget.

Supply lines have been disrupted leading to many factories including Hyundai, outside China, also shutting down. A consequence of today's just in time production, and this was only due to one week shutdown. China restart was planned for Monday Feb 10 but this may be extended by another week! The mood has changed, lost production, revenue and profits may never be recovered. The long touted recession may finally be here despite all the money printing by reserve banks around the world to avoid it.

Excessive money printing can only result in devaluation of fiat currencies worldwide. Some countries like Columbia and Zimbabwe have adopted the US dollar because their own currency have failed. However, all fiat currencies have only 1 outcome - a move to zero, as governments can never stop printing to offset tax deficits. Normally the affected country will just reset with a new fiat currency but today with the options of digital currencies and cryptos there are choices.

Why the increase in price for BTC

BTC proponents want you to believe that the moonshot is near or here. I believe that BTC price increased because it is the main gateway for new money to flow into BSV. If this is true then the next phase will be for BTC price to fall while BSV rises.

Thursday, February 6, 2020

Corona Virus and Economic Impact

The above show 549 deaths in Hubei out of 564. The death rate in Hubei is way above any other cities even in China. So why is this?

Professor Michael Levitt in the interview below suggest that the death statistics looks more like an instance of poisoning than a viral epidemic because of the localised nature of the deaths concentrated in Hubei. Secondary cities including cities out of China show death rates consistent with the common flu.

What is different about Hubei.

To understand this we have to appreciate why Chinese choose to consume exotic meats. Older generations being generally less educated, believe that consuming such products will benefit them health wise or cure them of certain ailments.

We know that Corona virus jumped from animal to human. Quite likely there was a sick animal which pass the virus to all the people handling it. These people will be the core and source of the infection. Perhaps consumption of the meat was also a health risk especially among older people.

The next round of infection are those that came into close contact with carriers which was made worse by the ability of the virus to spread even in its' incubation stage.

The red flag was first raised on 31st December 2019 and city wide quarantine imposed on January 23. Exposure through close contact probably stopped soon after that as everyone becomes aware of the risks. Quite possibly the virility of the pathogen is greater through direct contact and less from passing proximity or contaminated surfaces.

If 2019-nCov is a deadly killer virus the death rates in the whole of China would be exponential by now rather than tailing off. It is probably less of a killer than the common flu, unless there is close contact and direct exposure. The fact that it can be spread during its' incubation period is what will lead to the virus spreading worldwide and perhaps would be unstoppable. The only solace will be its' low fatality rate.

Is China To Blame?

Viral mutation is a natural phenomenon. It could have happened anywhere. It is fortunate for us that this strain struck in China at this time! Within 7 days of notification Chinese scientist were able to sequence the genome and place the whole cities of the nation under quarantine to stop the spread of the infection nationally and globally. No country in the world could or would be willing to take such draconian measures at such huge cost to their economy. We should be thankful that China did.

We have now learned much about this virus and much will now change. China would probably ban all live wildlife markets and this time it would probably stick. Old superstitions die hard and this experience will hopefully change worldwide attitudes and give new hope to wildlife and endangered species.

As 2019-NCov will most probably remain with us from now on, our attitudes towards personal hygiene, social behavior and cleanliness will change for the better.

Economic Impact.

China is the biggest importer and consumer of crude oil in the world. When China shut the taps crude prices fell 20% immediately. This shows the demand pull on oil prices and emphasis the potential for China to influence crude prices into the future should she wish to do so. OPEC no longer control oil prices. China does. Let us hope that she refrains from implementing a China first policy.

Looking further into the future, oil is a sunset industry with renewals and electrification of transport playing a greater role each year, countries reliant on oil do not have much time left to transform their economy. Elon Musk commented that it would only take 100 X 100 miles of solar panels to power the whole of the United States and a battery bank 1 X 1 mile to do so.

With China closing down its factories for an extra weeks many factories located in other countries also needed to cut or close production because they depend on China's supply chain. It would be difficult to change this reliance and dependency.

More that 140 million Chinese tourist visit other countries each year and many countries will take a hit economically as this revenue source has been completely shut both by China and by the receiving countries. How will China tailor its outbound tourism going forward, after this crisis?

Current estimate is that the world will take a 2% GDP hit in the first quarter of this year with China hit particularly hard. How will the US react to slow or reduce purchases from China as agreed in their phase 1 agreement? To raise dollars China can always sell treasuries and this will not be good for the US as it is still running bigger deficits each year.

A compromise will be found. If anything this episode have highlighted the fact that we have to live together as one people and one world. America first, China first or any country for that matter is a recipe for disaster. There will be a global recession just around the corner and this time there will not be a China pump to bail us out. We will have to do it together.

Monday, January 27, 2020

Bitcoin SV Next Bull Run

When will Bitcoin SV next bull run take place?

Guess we are all still buzzing over the last BSV price run up! When the dust finally settled BSV is up 300% and holding. So why did the last price hop happened? The main excuse was that CSW got the keys to his bitcoins! I commented then that it is nonsense as it was only a rumour and even if true the impact will be negligible. If the fear was that he would dump BTC to push up BSV then BTC should have experience a significant drop in price.

Those who are into BSV know that it is the original and real Bitcoin and are convince that it will be the only blockchain on which all blockchain apps will be built. The run up in price is only the first phase of existing whales and hedge funds building a position and new money coming into BSV.

Had it just been a CSW rumour then  BSV's price would have drop lower than from where it started - about $90. Instead it has settled around $300. The likely scenario is that this is the new floor from which the next price push will take place possibly to settle again between $600 and $900.

Timing a bull run is not a science. We can be sure that BSV will make its' biggest price break when hedge funds are convinced that BSV is the real Bitcoin. This will happen when all the arguments against BSV crumbles one by one and we reach tipping point in public perception first within the crypto community then in the wider public.

With that in mind the start of the next run should happen soon after the Genesis upgrade faultlessly. With that we should see all the apps timing for this event launch on the BSV blockchain. This burst in activity especially in monetized social media apps will pull many within the crypto community towards BSV.

How will it play out?

We should first see a sell-offs in alt as the smart developers and investors realise that their projects will work better on BSV. As before the move will be gradual but we will see it as a match between BCH and BSV.

It is quite surprising that BCH has maintained even the valuation it has now, with such low number of transactions on its' blockchain. Perhaps BCH supporters believe that it is digital silver to BTC'd digital gold. The truth is that with micro-transactions a reality, there is no need for digital silver, bronze or gold for that matter.

So the next phase will be a seesawing battle between BSV and BCH with the BSV whales taking every opportunity to build on their portfolio as the price moves in their favour. I suspect that BCH supporters will fight hard to prop up the value to stay ahead of BSV. If true this behaviour can be taken advantage off.

This phase will complete when BSV move to number 4 on coinmarket ranking indisputably, which will then trigger the next phase which is the race to NO 1.

Tuesday, January 14, 2020

WOW The Skip Happened ! Now For The Flip

When I wrote this article yesterday ( The Coming BSV Skip and Flip ) BSV was sitting at $170. Woke up this morning and it is $336 and has already surpass BCH at $331. No, I do not have a crystal ball or any inside information. I just noticed the volatility of BCH hashrate and suspected that something must be up with the Unknown Miners.

If BCH supporters are really desperately trying to keep their hashrate up by renting mining rigs then the game is really up. It is only a matter of time, as this will be a futile exercise. They will not have enough money to keep up with the rising price of BSV. It is a vicious feedback loop. Now it has happened. There will of course be resistance with market support but the outcome is inevitable. The fundamental value proposition for BCH is flawed.

For my observance this was my reward.

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This is the first time that I have ever been banned and I have not posted there in 2 years. Guess the truth must hurt. Can't be that bad really because BCH price is actually up by about $70 since my post.

So the The Skip is over. Now the mainstream crypto presses will be pushing hard on the Tulip Trust narrative. Come on be serious. Anybody with common sense can see that it is all about the technology. Why is it that hard to fathom?

Unconfirmed if and buts about the tulip trust even if true, cannot account for the huge run up in price. It means that there is real demand especially when you realise that BSV price have been going up steadily since mid December and in reality since the delisting. 

Will The Flip happen now? Of course. More people are starting to believe or hedging their bets just in case.

Pump and Dump

Will there be a huge dump coming up? Unlikely. Those holding BSV are believers. Being a very divisive 3 way tug of war between the 3 coins those who wants to dump have done so already. The BSV community is even smaller than BCH, and those who are invested for the long term will hold on to their coins, which creates scarcity and more upward price pressure.

There will of course be attempts to push the price lower by traders but the variation will be no more than 30% at most and will be good opportunity to buy the dips. 

Watch the hashrate

I have explained what I believe will be the mechanics of The Flip so I will not repeat it here. As hashrate moves over to BSV, BTC's blocktime will rise and the mempool will bloat as well. This will be the start of the dreaded Chain Death Spiral for BTC. 

The average time between blocks for BTC is rising fast and is already at 17 minutes almost taking twice as long for blocks to confirm. 

Now that everybody have seen what happened BTC supporters will surely put up a valiant effort to prevent the Flipping. There will be lies, misinformation, market support, etc and again the outcome is inevitable. The value proposition that BTC is digital gold is also flawed. The great hope for BTC in the lightning network is also in trouble with security ans scalability issues.

As more people who have substantial financial stake in BTC realise, or start to feel uncomfortable about this, they will start to hedge by at least equalising the number of each coin held. This will of course drive up the price of already tightly held BSV. In a rising market miners will also withhold coins, selling only if they have to further restricting supply. Those selling in the hope of buying back on the dip if are unable to do so will quickly re-buyback at a higher price which will again add to upward price pressure.

Why should BSV succeed.

It has a useful value proposition anchored on a stable protocol with massive scaling.

Other ancillary reasons

1) The Bitcoin founder is behind the chain and supports the development of the chain. I have believed that Craig was Satoshi when he first turned up at this discussion back in June 2017. As more people accept this fact the negative connotation of Craig's effect on BSV price in the past will reverse. I also wrote another piece on why it matters.

2) The developer tools available to support building on BSV. The emphasis is on building useful apps, not on currency and price. The only way to get mass adoption is to get the masses using Bitcoin without them knowing that they are. 

3) The nChain team and Bitcoin Association are always announcing new apps, tools and developments. There is a sense of growth and vitality.

4) The BSV development team always deliver on their promises usually ahead of deadline scheduled.

5) The community is alot more friendly.

That said, all that is left to do is to sit back and watch events roll out as predicted. It is a great time to be alive and watch this drama play out.

Monday, January 13, 2020

The Coming BSV Skip and Flip

For the moment all eyes are on the huge price increase of BSV from around 98 USD to 170 USD over the last week. An increase of over 70% and would most probably exceed $200 soon. So what is happening?

For those who believe in the underlying technology of BSV the reason is clear and inevitable. BSV is the original protocol as described in the Bitcoin whitepaper and despite the timeline BTC and BCH are the forks off the true protocol. A "Back To The Future" scenario!

The main theme of this post is a prediction that BSV will soon surpass the price of BCH (The Skip) and thereafter go on to surpass the price of BTC ( The Flip ). Contrary to our intuitive nature of believing in the slow rate of change in the crypto sphere, these events will happen quite quickly, because theses events are very much determined by the mining hashrate.

For most of 2019 the hashrate for BCH was about 2% and BSV around 1% of the total hashrate. This week the hashrate in both these coins have doubled to 4% and 2% respectively. This means that miners are finding it more profitable to mine these two coins or the supporters of these coins are renting hashes to support their chain.

Notice the amount of "unknown" miners on the BCH and BSV blockchain and none on BTC. The hashrate on BCH have been fluctuating between 1.5 to 4.3% recently. For BCH, it is dangerous for its' hashrate to fall below that of BSV as it would very quickly be reflected in the price of these two coins.

Unknown Miners

Unknown miners have always been a part of Bitcoin mining, but the significant part that it is now playing on BCH and BSV is unprecedented. Seeing that is is more than 3%, the increase must be a switch from BTC mining either as a result of mining rentals or BTC miners dedicating some of their hashrates towards BCH and BSV without reveling themselves as doing so.

The increase in blocktime on BTC is starting to show. Keep an eye on this developing situation.

There is still much debate going on about which is the true Bitcoin and which will survive. Miners are business people and they will only be motivated by profit. It does not matter to them which coin wins as they will always mine the most profitable coin.

Prior to November 2018 the price of BCH which included BSV fluctuated a great deal but after that date BCH price have mainly trended downwards.

BSV price on the other hand trended downwards because it was delisted on many leading exchanges but has since trended upwards against BTC as oppose to BCH. The price drop as a result of delisting must be looked upon as a manipulated event and accounted for when studying the chart above.

Against BCH the price of BSV is also clearly trending upwards.

All these events must be looked at as part of the continuing struggle between BTC, BCH and BSV as to which is the real Bitcoin. When 3 coins are competing on the same mining algorithm only one will win. This is a winner takes all scenario.

The Skip
It is dangerous for BCH if its' hashrate falls below that of BSV as this will soon be reflected in the price. Because the price of BSV have been on the uptrend we can expect that some miners are dedicating a little of their hashrate to mining BSV as a defensive move. These will mainly be the source of the Unknown miners we see on the BSV blockchain.

The dilemma for BCH supporters is that if they do not do something about the mining hashrate their coin will be in danger. As price is not a real factor in the volume of Unknown miners on the BCH blockchain we can only surmise that it is the result of hashrate rentals by BCH supporters.

This situation is unsustainable as the more BSV price increase against the more hash rate they must rent from the available rental pool and also carry the losses on the BCH mined as BCH price trends against that of BSV.

This will all come to a head when BSV price exceeds that of BCH. This is the Skip event, after which the price of BCH will move down sharply. BCH goal of becoming digital cash will be over. It is not possible to be used as a digital currency if your market cap is less than 2 Billion USD.

The Flip
During the BTC and BCH war, BCH overtaking and replacing BTC was known in the crypto community as the flippening. This did not happen and BTC successfully retain the overwhelming majority of the Bitcoin hashrate.

BCH survived the Chain Death Spiral because it had the Emergency Difficulty Adjustment programmed in. It was able to retain a percentage of mining hashrate commensurate with its' price for profitable mining. This also applied to BSV after it forked from BCH.

We have already seen today at least 3% of hashrate moving away from BTC. As the battle between BSV and BCH intensify we will see more hashrate moving away.  The BTC blockchain is acutely vulnerable to loss in hashrate and the Chain Death Spiral. We may start seeing a slowdown in BTC blocktime in the next few days.

The halvening of the BTC, BCH and BSV will have a large impact on the price and hashrate distribution between these coins. If prices do not double to maintain profitability, it must be met with increasing value collected through transaction fees. Only BSV have the capacity to gain more from transaction fees per block than block subsidy.

Note the steady increasing trend in transaction fees over block reward for BSV.

Soon after The Slip, our attention will be turn to The Flippening round two BSV against BTC. This time there will be a real difference in ideology between the two chains.

A coin can only be relevant if it is useful. It will not be useful to the masses unless it can scale. Here BSV clearly trumps BTC as it can already achieve thousands of transaction comfortably while BTC is still stuck at a maximum of 7 transactions a second. Large blocks means lower cost per transaction leading to new applications built around micro transactions. Usefulness brings mass adoption. BTC is clearly not geared towards mass adoption but towards being used by a minority as digital gold. This will not succeed as it requires Governments to adopt BTC in their currency reserve in order to push the price of BTC towards a million dollars a coin perhaps. This is unlikely because participants in the world monetary system will not want to see huge chuck of wealth in BTC they do not control.

BSV on the other hand will achieve this by default. In striving for scaling and mass adoption and it will become embedded into all our lives at a global level. National currencies will be tokenised on the BSV blockchain and this will be the "Killer App" that will cement BSV as the real Bitcoin.

With scaling comes mass adoption leading to The Flippening.

Last Note For The Skeptics.
If you are still skeptical about the above then this chart may change your thinking. Using BCH as a base every crypto coin including BTC is negative except for BSV.

The Flippening

Friday, January 10, 2020

BSV hit $150 today. It is NOT a pump!

BSV hit a high of 156 USD today before falling to 149. Over the last seven days it had increased market cap by over 60%. Over 30% in the last 24 hours. This has sent jubilation and panic into the supporters and detractors of BSV.

If you read the recent post, the reason for the rise was developments in Craig Wright legal case.

Well, nothing has been revealed and nothing has changed! So why should BSV supporters suddenly pump the price by buying big? At this point most of the early adopters have invested into their favorite coins and over the last 2 years since BTC peaked at 20,000 no new money have come into the industry. Movements in values have mostly been the result of speculation and hodlers moving between coins on pure speculation.

Something has changed with BSV since mid December it has started tracking higher against BTC, going against the trend. Something has changed.

Since its' inception a year ago it has been under attack from almost every quarter of the crypto community mainly because of the mercurial personality of Craig Wright, and it has been largely successful till now.

Why now? It is because Crypto is all about technology. Like Google and Facebook, the best technology in the space wins and dominates completely. So why has BTC not done so? Why BSV? The answer is because BSV is the real McCoy. BCH and BTC are the Forks! After Febuary 4 2020 BSV will have unlimited block size and unlimited scaling potential.

Remember that we had 2 years of blocksize debate before BCH branched off to 2 megabytes blocks. It is all about being able to scale because only then enterprise level applications can become viable. The other necessity for enterprise adoption is a stable protocol. You can't write huge software applications only to rewrite them again when the protocol changes. After February 4 BSV protocol will be set in stone meaning that all applications written will always be backward compatible. There will be improvements to the BSV protocol but the base layer will be stable.

This is the reason for BSV price rise. Hedge fund money is coming into the space.

The first of these hedge funds Unbounded Capital has moved into the space. Make no mistake. Others are taking notice. Crypto use to follow BTC but BSV is begining to decouple. Small increments from December 18 but the swings will widen.

There will only be one winner.

This is the nature of Crypto. It will mimic the development of the internet. Before the dominance of the internet, intranet was all the craze. Every company wanted their own permission and private intranet. The problem with any closed system is that development stagnates. No matter how large a company, it can never match the power of open source permission less development.

The first condition of a permission less platform in Crypto is a stable platform. This means that no group of developers will have the ability to change the protocol. This is what BSV will become. With a stable platform and unlimited scaling, it will be the only crypto left standing when the dust settles. All the rest will just become curiosity coins.