Nick Chong · 1 hour ago · 2 min read
News › Technical Analysis
Bitcoin SV splits in two as miners fail to upgrade for the recent hardfork
Disclaimer: This article contains technical analysis, which is a methodology for forecasting the direction of prices through the study of past market data, primarily price and volume. The content presented in this article is the opinion of the author. None of the information you read on CryptoSlate should be taken as investment advice. Buying and trading cryptocurrencies should be considered a high-risk activity. Please do your own diligence and consult with a financial advisor before making any investment decisions.
Bitcoin SV (BSV) went through a hard fork that is intends to bring it closer to the original Bitcoin protocol. Despite the significance of this milestone, a substantial number of miners failed to upgrade splitting the chain in two.
The “Genesis” hard fork
On Feb. 4, at block 620539, Bitcoin Satoshi’s Vision experienced a network upgrade dubbed “Genesis.” The purpose of this hard fork was to get the BSV protocol as closely as possible to the original code released in 2009 by Satoshi Nakamoto, according to a press release. As a result, the default hard cap for block sizes and transaction capacity limits have been removed allegedly increasing on-chain scalability.
Jimmy Nguyen, the founding president of the Bitcoin Association, said:
“By bringing back Satoshi’s design in Bitcoin SV, the Genesis hard fork is a historic moment in Bitcoin’s journey to become the world’s peer-to-peer electronic cash system and enterprise blockchain that can power everything. The Internet birthed a world where everything can be ‘online’; Bitcoin can now – through Bitcoin SV – enable a world where everything can be ‘on-chain.’”
Genesis is designed to enable developers and enterprises to “build large-scale applications” on top of the BSV blockchain. The different “restorations” in this hard fork will also allow BSV to expand its utility. Now, it can serve not only for payment transactions, but also for “smart contracts, content delivery, enterprise application, Internet of Things, and other uses.”
BSV suffers a chain split
The BSV community seems optimistic about the new iterations. However, BitMEX Research reported that “a significant number of nodes [that] have not upgraded for the hardfork and are stuck on the pre-hardfork block.” The incident resulted in a chain split where “the old rules [of the] chain [were] extended by one block.”
Nguyen claimed that this was not a persistent chain split. In fact, it seems to have been caused by one miner “who did not update their software to Genesis.”
“A single block inadvertently mined on the wrong chain will not be extended – just the way Nakamoto consensus is supposed to work as described in the Bitcoin white paper. Nodes consider the longest chain as valid and extend that branch.”
The impact that the Genesis hard fork and the chain split may have on BSV has yet to be seen. Regardless, the price of this cryptocurrency recently broke below a significant support level signaling steeper decline.
A retracement could be under way
Based on its 12-hour chart, Bitcoin SV moved below the 50-twelve-hour moving. A candlestick close below this significant support level could trigger an increase in the selling pressure behind this cryptocurrency. BSV could try to test the next level of support given by the 100 and 200-twelve-hour moving averages. These barriers of support sit at $190 and $150, respectively.
Moreover, the TD sequential indicator presented a sell signal adding credence to the bearish outlook. The bearish formation developed the moment the current red two candlestick began trading below the preceding red one candlestick. This technical index estimates that a new bearish countdown to a red nine candlestick could begin.
Nevertheless, an increase in demand that allows Bitcoin SV to close above the $320 resistance level could jeopardize the pessimistic outlook. Such a bullish impulse would likely take this cryptocurrency to retest the recent high of $459.