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Bitcoin Cash price surges as Coinbase adds support
The price of bitcoin alternative Bitcoin Cash surged in trading Tuesday as cryptocurrency marketplace Coinbase Inc. added support for the new currency for the first time.
Bitcoin Cash, a “forked” version of bitcoin, debuted at the beginning of August, when existing bitcoin holders were issued the same amount of Bitcoin Cash as they owned in bitcoin. Coinbase at first refused to support the cryptocurrency, resulting in some users threatening to take legal action, but four months later it has had a change of heart.
Coinbase announced early Tuesday that it would start supporting Bitcoin Cash, complete with issuing users amounts of the cryptocurrency based on their Aug. 1 bitcoin holdings. The marketplace said trading would begin once there was sufficient liquidity on the Coinbase-owned GDAX exchange. In a market that some are comparing to tulipmania, that liquidity didn’t take long to appear, with Bitcoin Cash debuting on Coinbase at 8:20 p.m. EST.
That’s when the chaos began. The price of Bitcoin Cash surged worldwide from $2,160 just after midnight EST to hit a high of $3,774.14, according to figures from Coinmarketcap. But on Coinbase’s GDAX, the price went much higher, hitting a peak of $9,500 before Coinbase stepped in and suspended trading at 8:24 p.m., exactly four minutes after trading had begun.
After that, a further update on the GDAX status page as of 9:30 p.m. said that though trading remained suspended, existing orders were now being processed and that a further update would be forthcoming.
The reason for the trading suspension was not disclosed, but Coindesk said that it was likely because Coinbase couldn’t handle the volume of trades, rather than because of the price surge.
With all the interest switching to Bitcoin Cash today, the price of bitcoin headed south, trading at $16,686.69 as of 11 p.m, down from $18.899.76 at the start of the day.
Bitcoin futures were also hammered. One- and two-month contracts on the Cboe Global Markets exchange dropped to $17,250 and $17,480, respectively. Perhaps more notably, March 2018 contracts are now trading at $16,960, the first time three-month contracts have shown that the market believes that the price of bitcoin will drop next year.
Photo: zcopley/Flickr
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