One bitcoin is now worth less than $5,900, down 25 percent from Wednesday's high above $7,800. Meanwhile, the currency of a rival, spinoff network called Bitcoin Cash, has doubled to more than $1,500 over the same four-day period.
This is good news for one side in Bitcoin's ongoing civil war?the side that sees an urgent need to boost the network's capacity to deal with growing congestion and rising transaction fees. People in this camp have been flocking to Bitcoin Cash after a plan to expand the capacity of the main Bitcoin network fell apart on Wednesday.
"Bitcoin Cash is what I started working on in 2010," tweeted Gavin Andresen on Saturday. "A store of value AND means of exchange." It was a pointed dig to the mainstream Bitcoin network, where slow transactions and rising fees have made it an increasingly unappealing way to make everyday payments.
The endorsement is significant because Andresen was chosen by founder Satoshi Nakamoto to lead the Bitcoin project after Nakamoto faded from the scene in 2011. Andresen was frozen out of the Bitcoin Core development team last year in the midst of a bitter debate over the network's future.
Right now, Bitcoin Cash is still the underdog, as the value of conventional bitcoins is about four times the value of "cash" bitcoins. But supporters are betting that this will change as demand for both networks continues to grow. The Bitcoin Cash network has greater capacity now, and it has a community that is committed to expand the network further as needed.
Bitcoin Cash backers believe that with the leaders of the mainstream Bitcoin network stubbornly resisting such capacity increases, it's only a matter of time before these advantages make it the dominant payment network in the Bitcoin world.
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