The contentious Bitcoin Cash hard fork that took place at the back end of last year resulted in liquidity being drained out of the market, in turn causing the market to suffer significant losses. The new chain dubbed BSV, supported by Calvin Ayre, has consequently carved out a not insignificant share of the market. However, for much of its existence, it has underperformed its counterpart, BitcoinCash.
In the latest episode of this saga, Binance announced that it will be delisting BSV on Apr 22. The cryptocurrency exchange has cited evidence of fraudulent conduct in relation to Craig Wright's continuous claims he is, in fact, Satoshi Nakamoto, as part of the reasoning behind their decision. Other exchanges and vendors such as Shapeshift and Blockchain.com followed suit.
What are the implications of Bitcoin SV (BSV) being delisted by Binance? Could the move spark another wave of selling or act as a fresh catalyst for a crypto rally? Of note, the Bitcoin Cash network is due for another upgrade in the not so distant future. As per the official schedule, shortly after 12:00PM UTC on May 15, 2019, the Bitcoin Cash network is scheduled to experience a network upgrade.
As a primer, Bitcoin was trading around $6,500, while Ethereum was at $200 last year before the Bitcoin Cash hard fork split the market into two opposing camps. The fact that the delisting of the BSV appears to be broad-based across the main exchanges suggests that the crypto market may, in fact, catch a bid here, in which case we will be looking at pre-hardfork levels as the next price targets. Also, another thing to be aware of is that cryptocurrency miners that supported Bitcoin SV may now look for an alternative source of revenue. Some may revert back to Bitcoin Cash or Bitcoin. Non-mining coins such as XRP outperformed during the sell-off last year, and the opposite may now be true.
If there is one lesson to be learnt from this, it is: diversify your exposure, because corporate responsibility is not always on the agenda when it comes to crypto/blockchain companies.
In other news, 94% of endowment funds have stated they've invested in crypto assets, either directly or through an intermediary last year, according to a survey conducted by Global Custodian, The TRADE Crypto, and BitGo. The study was conducted in the fourth quarter of 2018, and 150 funds—mostly U.S. based—took part.
Thank you for reading,
The BeQuant’s Analytics team