Over extended periods, Bitcoin Cash (BCH) remained dormant during what is known as "crypto winters". Yet, the current scenario finds BCH within striking distance of the $500 mark, showcasing an impressive performance over the last twelve months.

Recently, BCH was traded at $465.29, demonstrating a surge in demand within the preceding week. The community now anticipates a potential breakout, with BCH edging closer to the lucrative $500-$600 bracket during the first quarter of the year. Despite these promising developments, BCH has yet to reach four-figure price levels, putting the patience of investors to the test.

One of the key factors preventing BCH from launching into a sustained rally is its relatively subdued trading volumes. Even post a bullish phase, BCH's daily trade volume has dwindled to approximately $400 million, a figure that falls below expectations for a top-tier digital asset positioned within the top 20 cryptocurrencies. A revival in BCH trading might depend on a resurgence in market interest.

Looking back over the past year, BCH has experienced a fruitful period, climbing from approximately $120 to a peak that nearly touched $700. In a surprising twist, BCH emerged as a more reliable store of value compared to BTC, the latter soaring from $27,000 to its current value of $62,300.

Amidst the ongoing controversies, BCH continues to captivate both novice entrants and seasoned hodlers, observed through a considerable number of wallets holding onto BCH for upwards of 52 weeks.

Bitcoin Cash Gears Up for Block Size Limit Upgrade

In the upcoming week, the Bitcoin Cash blockchain is slated for an upgrade aimed at establishing a more flexible mechanism capable of handling heavier network loads. This imminent update will implement an elastic block size limit, with network rules poised to adapt based on prevailing circumstances. This initiative follows years of contentious debate surrounding the block limit, with advocates on opposing sides debating the merits of small blocks versus unrestricted block sizes.

Despite the Bitcoin Cash network not yet reaching a saturation point in terms of usage, recent advancements have introduced tools for crafting smart contracts. The upcoming upgrade sets a solid foundation for scalability and adaptability, eradicating the need for last-minute voting or protracted discussions concerning block sizes.

Migration of BCH Tokens to Exchanges

Following BCH's successful rebound from its low point, a segment of traders has opted to capitalize on profits garnered during this period. Consequently, in recent months, the influx of BCH into exchanges has accelerated, surpassing the six-month average.

According to insights derived from Chainalysis research, about 51.3K BCH is presently held across various exchanges. However, this figure only paints a partial picture, as an increasing proportion of BCH is gravitating towards crypto-to-crypto exchanges, with a corresponding decline in BCH allocations directed towards fiat-based exchanges. Notably, the most active trading pairing involves USDT on Binance, albeit with a riskier slippage rate hovering around $700K for a 2% downturn. The pairing with USD on Coinbase boasts twice the liquidity compared to its counterparts. Additionally, BCH's liquidity is bolstered by the Korean won, accounting for approximately 19% of its trading volume, thereby establishing a substantial pairing alongside BCH/USD.

Bitcoin Cash Embraces DeFi Landscape

With aspirations of aligning itself more closely with Ethereum and other Layer 1 networks, Bitcoin Cash has embarked on a transformation journey towards building a decentralized finance (DeFi) portfolio. This strategic shift unfolded in recent months as Bitcoin Cash witnessed an uptick in the value locked within the DeFi segment, which, although nascent, currently houses under $20 million across various projects. In emulating Bitcoin's approach, which now serves as a platform for hosting tokens and facilitating decentralized trading, Bitcoin Cash aims to carve a niche for itself within the burgeoning DeFi ecosystem.

Noteworthy as well is Bitcoin Cash's comparative advantage in terms of maintaining relatively low transaction fees. On regular days, the transaction fees for transacting in BCH hover around $0.01, a stark contrast to the consistently high fees incurred when transacting in Bitcoin. Even during periods of heightened activity, such as the recent episode on May 5, BCH transaction fees have not exceeded $1, showcasing its allure to users seeking cost-effective transactions.

Resurgence of BCH Miners in the Past Month

The realm of Bitcoin Cash mining has undergone a revival in recent weeks, witnessing a twofold increase in hash rate as of May, thereby culminating in a current hash rate of 4 EH/s. This surge in mining activity can be attributed to improved difficulty conditions, with the Bitcoin Cash network featuring a dynamic difficulty recalibration mechanism, thereby forgoing the bi-weekly adjustment cycle present in Bitcoin's mining ecosystem. Such measures aim to avert periods of sluggish block production, especially considering the comparative scarcity of miners participating in Bitcoin Cash mining operations relative to Bitcoin's robust mining network infrastructure.