Bitcoin cash’s surge above $500 today is changing more than just the the net worth of its investors and users.
The rising price is also creating the incentive for miners to dedicate computing power to the bitcoin cash blockchain, one that could find them moving away from bitcoin. With the new push, bitcoin cash miners are making around 2% more mining on bitcoin than they do on bitcoin cash.
And that spread could further increase with an upcoming adjustment on bitcoin cash that will make it even easier to mine.
Block 479,808 (set for this weekend) will likely trigger a difficulty adjustment downwards 50%, and if the prices of bitcoin and bitcoin cash stay the same, this means miners will make almost double on bitcoin cash what they would on bitcoin.
However, even with this threshold met, not all things are equal on both chains.
The bitcoin blockchain charges higher fees on transactions, so miners must take into account the extra 1.5 BTC per block on bitcoin (about $6,000 USD). By comparison, bitcoin cash has very low fees (typically under $50 USD).
Lastly, depending on the block times, bitcoin currently gets the 100 confirmations needed to spend the mining reward faster than bitcoin cash. (Currently, bitcoin takes about 17 hours and bitcoin cash takes about 34 hours).
Further, combined with the higher liquidity, bitcoin may still emerge as more attractive to mine at the moment.
Bitcoin mining card image via Shutterstock