A little over a month ago, China tightened regulation on ICO’s and cryptocurrency exchanges, crashing the price of BTC from $4,975 down to under $3,000. Now, just over a month later, we have seen a Bitcoin price rally, blowing past previous all time highs.
WHAT IS CAUSING THE RALLY?
Many people are moving their positions from altcoins into Bitcoin in anticipation of the “Bitcoin Gold” hard fork that will be time-stamped on October 25th. In a fork, a group of miners decide to create a copy of the existing blockchain from a particular block, then branch off into a new blockchain thereafter, typically to implement different protocols or policies. As a result of this blockchain copying, every person who holds BItcoin in a supported wallet will receive free Bitcoin Gold at a rate of 1:1. This is a very attractive motivation to be invested in BTC currently, especially after the last “Bitcoin Cash” fork birthed a top 5 cryptocurrency out of thin air, earning investors mountains of “free money.” It’s clear that the hope and expectation for this hard fork is relatively the same, as Bitcoin’s rally comes during an otherwise greatly reduced market. Bitcoin is on fire, and altcoins are on sale.