After the November hard fork, Bitcoin Cash (BCH) has seen a drop in both on-chain transaction value and the number of active users.
Blockchain research platform TokenGazer released a research report on Bitcoin Cash January 23, mainly focusing on recent changes surrounding the coin, such as trading volume, active users and hash power.
Deceasing Search Interest in BCH
According to Google Trends, the search interest in both “BCH price” and “BCH USD” has dropped to a rather low level from its peak in December, 2017.
As shown in the graph below, the search interest in Bitcoin Cash has remained at a low level over the past year despite a sharp yet short-lived increase during the hard fork in late November last year.
Search Interest in “BCH Price”
(Source: Google Trends)
Search Interest in “BCH USD”
(Source: Google Trends)
Shrinking On-Chain Transactions (24 Hour)
As shown in the graph below, the BCH on-chain transaction volume has continued a downward trend in recent days. The 24-hour transaction volume was a mere 6,883 by January 22, only 0.328% of its all-time high of 2.1 million on September 1, 2018.
BCH On-Chain Transactions (24h)
(Source: https://coinmetrics.io)
Active Address (24 Hour)
The number of BCH 24-hour active address has also hovered at historic lows since last November, when the amount soared to a record high in the face of a hard fork.
BCH Active Address (24h)
(Source: https://coinmetrics.io)
Hash Power
The hash rate of BCHSV surpassed that of BCHABC at the time when the hard fork just began, yet BCHABC has continued to outperform BCHSV in hash power since December 18, 2018.
(Source: https://cash.coin.dance )
Mining Pool
As TokenGazer put it, BCHABC has won the support of many large mining pools. In this case, it’s difficult for BCHSV to surpass its rival in the scale of hash rate.
(Source: https://cash.coin.dance)
Network Value to Transactions (NVT)
The NVT ratio measures the value of crypto transaction activity relative to network value. When the growth in transaction volume exceeds that in network value, the NVT ratio shows a downward trend and the crypto becomes more investable.
BCH has become more investable with the NVT ratio falling to a rather low level in recent days.
(Source: https://coinmetrics.io)
Volatility of Daily Returns (30 Day)
The volatility of daily returns shows the price fluctuation and risk level of one crypto asset. Currently the crypto market as a whole sees a slight drop in volatility compared to early 2018. Recently the BCH 24-hour volatility falls in tandem with other major cryptocurrencies.
(Source: https://coinmetrics.io)
Correlation
(Source: https://coinmetrics.io)
According to the research report, the correlation between crypto assets has sharply increased since the beginning of 2018. The correlation between Bitcoin and the entire crypto market has also strengthened.
Sortino Ratio
The Sortino ratio shows the relationship between risk and return. The BCH 90-day Sortino ratio has sustained a downward trend since 2018.
(Source: https://coinmetrics.io)
Conclusion
As the price of Bitcoin Cash has continued to drop, the market seems to get cold feet on it. The volatility of BCH has gone down along with that of all cryptos as a whole, and the coin sees a high positive correlation with Bitcoin.
In this case, it makes sense for investors to pay close attention to the technical development, application and ecosystem construction of BCH, in hope that there will be an improvement in the fundamentals of BCH in the days to come.
