Bitcoin Roundtable Puts Market at Ease
Bitcoin has had an interesting few weeks from a fundamental perspective with 80% of mining power and many Core devs meeting in China to try to quell the hard fork talk. While we think this is a good thing, we also know that nothing is for sure so we want to watch this closely.
For those that don’t know, last weekend we saw an impromptu Scaling Bitcoin conference in Hong Kong which many miners, devs, and stakeholders attended to attempt to head off the increasing level of rhetoric and argument surrounding Core vs. Classic HF talk. What they determined is that SegWit would roll out in April of this year with code for a 2MB HF being released in July for an approximate activation date of July 2017 given 95% consensus. With 80% of the global hashing power having signed the agreement, we think it is very unlikely that Classic activates a HF this year (meaning no HF in 2016 at all).
Having said that, we have seen in bitcoin that these agreements are not set in stone and opinions can be swayed over time. While we hope that constituents stay steadfast in their support for Core, we cannot guarantee this will be the case so it is better to consider this possibilities now before we get caught off guard. All things considered, though, we think that if the network can stave off a hard fork until the Core code for the block size increase is released in July, then the chances of a controversial Classic HF are de minimus at best.
So what does all of this mean for the bitcoin market? As with any financial asset, when any amount of uncertainty is contained or removed then it allows prices to rise, ceteris paribus. Given that this move by the Bitcoin Roundtable does dampen uncertainty for the time being, we think that there is the potential for a rather substantial move higher if and when the technicals get properly aligned. We think this Spring will be very good from a seasonal perspective.
Happy trading and have a great BITday!
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