LUCKNOW (CoinChapter.com) — Bitcoin Cash (BCH) has seen notable growth recently. It has surged nearly 84% since March 20, reaching a daily high of $640 on March 29. The surge in BCH price has caught the attention of investors and traders. Same as each other.
Bitcoin Cash’s price rally pared some of its gains on March 29 after reaching its highest level since November 2021.
However, a combination of factors, including the cryptocurrency’s upcoming halving event and the announcement of a significant network upgrade set to be deployed in May 2024, could help BCH tok continue to rise.
Effects of Half Life
Halving events are a mechanism built into the DNA of Bitcoin Cash. This halves the reward for mining a block, similar to the Bitcoin halving. This event is held every four years and aims to control the supply of BCH. Therefore, the halving event introduces a deflationary aspect to cryptocurrencies.
As rewards to miners decrease, there will be less new supply of BCH, potentially pushing the price higher if demand remains constant or increases.
Historically, halving events have been bullish for the tokens involved, as they tend to increase speculation and interest in the affected cryptocurrency.
Expectations of a decline in new supply often lead to optimistic sentiments among investors, pushing prices higher ahead of the event. For Bitcoin Cash, the upcoming halving is no exception, contributing significantly to the current price increase.
Network upgrade expected in May 2024
Another important factor affecting the BCH price is the network upgrade scheduled for May 2024. This upgrade includes the implementation of an adaptive block size limit algorithm, increasing the project’s ability to scale and adapt to different levels of transaction demand.
The new algorithm adjusts block size limits based on the exponentially weighted moving average size of previous blocks, effectively making the network more responsive and efficient.
Moreover, the upcoming update addresses issues such as scalability and network congestion that have plagued the Bitcoin Cash community for some time.
Bitcoin Cash aims to improve its utility and attractiveness as a transaction currency by introducing an adaptive and more responsive approach to block sizing.
It is also claimed that the upgrade will reduce the social and technical complexity of manually adjusting block size limits, simplify network governance, and reduce vulnerability to social attacks.
The impending halving event and expectations of a network upgrade in May 2024 have likely shaped the Bitcoin Cash token’s recent rally.