Much happened since the fork of August 1st 2017 that created Bitcoin Cash (BCH) : in contrast to what a lot supposed at the time, the new cryptocurrency did not die quickly and its community did not stop growing.

Since then, the casual observer of cryptocurrencies could not help but notice that a trend is taking place.

BTC train loosing steam

As weeks pass by, quite a number of merchants and enterprises have decided to drop usage of cryptocurrencies all together or at least Bitcoin. The general state of this blockchain with its spike of congestion, pushing some transaction confirmations after many hours instead of mere minutes, and the consecutive rise in fees have been enough to give a headache for many merchants that will have a hard time to come back to crypto.

In any case, the Bitcoin BTC community has clearly started to explain that these problems were not so serious, in part because the whole philosophy of Bitcoin BTC was to "hodl" and certainly not spend coins (there is no high fees and no long confirmation time if you do not spend your coins), and in part because a solution was in the pipe, namely, Lightning Network (LN).

However, the Lightning Network, touted to be the solution for many years now (it will be ready soon™) displays all aspects of a hub and spoke model, with centralization. The growth is very slow, the adoption among merchants even slower (nil ?) and the more one think of it, in the end, there is nothing to stop people using LN without ever using BTC anymore, defeating the whole purpose of the currency supposedly underlying this network...

BCH innovations

At the same time, the opposite experience could be made when using Bitcoin Cash.

Fast transfer, low fees, consistent inclusion of the transactions in the next block for a minimum fee, and now a block size that allows 100 transactions per second (which is the same level of transaction processing power than Paypal, to give a rough idea), this indicates solid perspectives.

This development probably explains why the merchant adoption is growing for BCH, and it most probably fuels an innovation wave that helps grow adoption in feedback. Such projects as memo.cash , blockpress , cointext , cryptocribs , akari-pays , yours , coinfundr.co , minipos.cash , and many others have already generated strong enthusiasm from the BCH community and beyond.

What's next?

At this point, a very legitimate question could be to ask what might happen for BTC and BCH if these current trends remain the same?

In the short run, one might expect BTC to continue holding (hodling?) its use as a store of value. In the mid to long term however, one has to notice that problems that were seen on BTC during the last 2 years and especially end of 2017 (such as congestion, high fees and unreliable time of processing) are still not solved, causing loss in market dominance and relevance as a means of payment.

Even assuming LN ends up working exactly as intended and advertised, no one will deny that it will take quite some time to first debug the current implementations, then instill trust in users from customers to merchants, and then penetrate market and make adoption easy and the ball rolling. Betting on one to two years to achieve these fundamental steps is definitely not unreasonable. Two years in cryptospace is awfully long, especially when taking into account the time already spent bickering on block size, and the innovation pace on its sibling BCH and other blockchains, Ethereum first in rank.

Risks are that this timing might be too long: from market share to real-life usage, it could well mean that the window of opportunity has passed for BTC.

Is a flippening in order ?

A flippening , as most see it meaning a sudden or abrupt change in the current cryptocurrencies paradigm, seems neither realistic nor desirable in the short term (= next months).

In any case, the amount of capital, the number of people involved and the brand recognition of Bitcoin BTC is big enough to guarantee its position for the coming months and in fact, it is not in the merchant's, generic user's and block miners' best interest to see BTC loosing its dominance too fast : time is needed in order for all ecosystems to adapt.

However, make no mistake : for some of the heavy players, Bitcoin is now no more than a short term bet, and economically speaking, their position makes perfect sense.

Then assuming the trends exposed in the previous paragraph continue, change will eventually occur :

either by forces of the market that will choose the mean of payment first over the store of value ; suffice to say that if real world is any indication, store of value plays only a very marginal role in all world economy. Unbanked people crave both mean of payment and store of value, which out of BTC and BCH, only the latter is able to provide consistently.

either triggered by some major change on BTC initiated by Core developers such as a change of Proof Of Work (PoW) for instance. One can rule an unexpected block size increase as rather unlikely since it is now a deeply ingrained idea that hard forks are dangerous, and block size increase will have dire consequences (such as strong centralization) ; trying to change this narrative on these two last dogmas will prove very complicated since parting with a cherished idea is very difficult, painful even. Besides, the risk of fragmenting the BTC community over a change in block size or PoW is very high.

At this point, one has to recall that network effect works both ways : if more and more people are getting interested in one crypto over another, the change is barely noticeable at first, up to the point where, after slowly picking up some speed, masses flock from one to the other almost in a matter of a few months.

Unless BTC addresses and solves its numerous problem, from its too low transaction throughput to its unpredictable fees and processing time, and does it in a timely fashion (we're speaking less than a year, here), competition (be it BCH or Ethereum or any other) will prevail.

The psychological problem

BTC has slowly but surely drifted from a beautiful piece of code to a system of belief, appealing at emotions way before reason.

In that frame, people who entered the cryptospace long ago and have high stakes in BTC will fight hard to keep their dream rolling.

Most of the late comers might rather easily change their minds, especially those whose stakes are not too heavy or those who did not express their position too loudly; some of them will even claim at some point "i knew it all along" , and even "I told you so" for the boldest of them. Things that are now seen as very unlikely and mocked upon will slowly be "reframed" as merely difficult to achieve, then at grasping distance then, once reached, as normal and even mundane, and a lot will pretend that this was both easy to foresee and even planned.

However, the most vocal proponents of BTC will be more inclined to viciously defend it without any limit or taboo. It seems only logical to expect more and more nasty stuff from them as competition will gain over it. If history is any good, is seems rather important for the cryptocommunity to understand what this paradigm shift will entail and to prepare itself, and - why not - to leave for the most vocal proponents some viable way to save face.