After a meteoric rise in value in the past 30 days, the bitcoin price has endured a major correction as it dropped from $7,500 to $6,550.
Before delving into the analysis of the downward trend and the recent decline in the price of bitcoin, it is important to acknowledge that the price of bitcoin has increased from around $4,500 to $7,500 within a single month.
Even with the recent major correction, the bitcoin price has recorded a 29.2 percent monthly increase and investors are overly concerned with the short-term price trend of bitcoin. Many analysts have predicted the price of bitcoin to plunge either after the cancellation or execution of SegWit2x, as B2X dividend expecting investors reallocate their funds from bitcoin to other cryptocurrencies.
Such trend has been evident in the decline in the bitcoin dominance index, which dropped from over 62 percent to 55.1 percent. Hence, a major correction on bitcoin has been long over due, considering the rapid increase in its price in a relatively short period and the SegWit2x hard fork.
The price of Bitcoin Cash did breach the $1,000 mark earlier today, but the increase in the value of Bitcoin Cash also seems slightly inorganic, given its 20 percent increase in value for three days straight. More importantly, the Bitcoin Cash market is heavily concentrated in South Korea, with three major South Korean trading platforms accounting for around 53 percent of Bitcoin Cash trading.
The rest of the trading volumes are composed of Bitcoin Cash-to-USD trades, not Bitcoin-to-Bitcoin Cash trades. Thus, it is too early to claim that bitcoin users frustrated with high fees are moving to Bitcoin Cash.