Bitcoin (BTC) has been coasting recently on fairly low market volatility until “things finally exploded” says BKCM’s Brian Kelly. The digital token managed to lost 10% of its value at the close of trade on Wednesday.
According to the crypto fund manager in an interview with CNBC, Bitcoin (BTC) tanked because of concerns over a hard fork happening with Bitcoin Cash (BCH). Traders were initially concerned that both Bitcoin (BTC) and Bitcoin Cash (BCH) markets could run into a chaos after a hard fork or software upgrade in the later.
Bitcoin (BTC) Market Downturn is the Result of What’s Happening With BCH
Kelly, a well vast crypto token fund manager, revealed that the sharp downturn in Bitcoin’s price had to do with what is happening with Bitcoin Cash (BCH). BCH splintered off in August last year from the regular Bitcoin (BTC) with the sole purpose of offering users the ability to process more transactions. Speaking Fast Money the crypto fund manager with BKCM said:
“Bitcoin Cash (BCH) is going for a hard fork or software upgrade.” “When you decide to carry out a software upgrade, typically everybody falls into agreement. But this particular case is different; everybody is not agreeing,” he added.
A Section of Crypto Traders Are Worried that the BTC and BCH Markets Would Enter Chaos
Kelly continues by saying:
“We have got ourselves a ‘cryptocurrency civil war. Some digital asset traders are concerned that the Bitcoin (BTC) and Bitcoin Cash (BCH) markets may run into a slowdown after the much-anticipated software upgrade in the later” he said.
Kelly expects it this catastrophe to be a “short-term” event. Calling it an opportunity. “We’ve been buying at my fund this Wednesday” he added. However, Kelly had a warning for buyers who are interested in the affected tokens: “If you do not understand what a ‘software upgrade or a hard fork is, do not jump into that territory right now.”
Several Events Resulted to Some Fund’s Taking Money off the Table
According to Meltem Demirors, the CSO (Chief Strategic Officer) at Coinshare, said many of the digital assets in the market are now traded tinly with monthly volumes. She explained this while appearing on Wednesday alongside Brian Kelly on “Fast Money.”
According to Demirors:
“I think every other asset that is not BTC is in facing a liquidity crisis. What we’re seeing is asset prices going down by 75% or more and in some cases 95%.”
“We’re currently at a point where many of these projects are running out of funds, ” she continues.
“They will need to start firing some of their employees so as to meet up. They’re going to have to cut costs. We should see consolidation, and then some digital assets, inevitably, may eventually be marked to zero.” she added.
Bitcoin (BTC) still retains its position as the world’s largest cryptocurrency by market cap notwithstanding. The asset saw a meteoric rise to expand its dominance last year to $19,000 per token in December 2017. However, since that time prices have dropped. The digital token is now trading under $6,000 as of press time.