Bitcoin pulled back Wednesday, sliding toward $84,000 after touching a seven-month high near $87,250 earlier in the week.
The retreat came as traders rotated into two unlikely winners: Bitcoin Cash and Bitcoin SV, forks that split off Bitcoin's main chain years apart. Both tokens posted some of their sharpest gains in months even as the broader market cooled.
Bitcoin Cash split from Bitcoin's main chain in August 2017 over a dispute about block size, aiming for cheaper, faster payments rather than pure store-of-value use. Bitcoin SV split from Bitcoin Cash just over a year later in a fight known as the "Hash War," when a faction led by Craig Wright pushed for even bigger blocks and a return to Bitcoin's original design.
Both networks have traded at a fraction of Bitcoin's price and volume ever since, occasionally spiking in tandem when a fresh catalyst hits.
This week's catalyst for Bitcoin Cash appears to have been CME Group, which said Monday it will launch Bitcoin Cash futures on Oct. 19, pending regulatory review. The move makes Bitcoin Cash, which trades as BCH, the exchange's tenth single-asset crypto contract with Uniswap as the eleventh.
Standard contracts will represent 250 BCH, with micro versions covering 25 BCH for smaller traders. CME's global head of cryptocurrency products, Giovanni Vicioso, said the contracts give institutions "broader, regulated tools to navigate evolving digital asset related price risk."
Bitcoin Cash jumped as much as 30% in the hours after the news, tearing through $340 and briefly touching $358 before cooling into Wednesday's session. Grayscale added fuel by filing to convert its Bitcoin Cash Trust into a spot ETF for NYSE Arca listing, giving BCH an institutional-adoption story on top of the futures pitch. The rally briefly pushed BCH's weekly gain past 50%.
Bitcoin SV, which trades as BSV, rode the same current, gaining roughly 20% alongside BCH and extending its climb toward $21—an annual high.
Open interest in BSV derivatives climbed alongside the price, a sign traders were adding fresh positions rather than just covering shorts.
That said, this is not an unfamiliar pattern : Bitcoin's forks tend to outrun the original coin in short, sharp bursts before giving gains back. The shorter the market capitalization, the easier it is to affect prices and increase volatility.
Spot Bitcoin ETFs pulled in $715 million on Tuesday, a solid inflow day even as the coin's own price stalled. CME's Bitcoin Cash and Uniswap contracts are set to begin trading Oct. 19, pending the exchange's regulatory review.
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