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What is Bitcoin Cash?

Bitcoin Cash

If you’ve heard of cryptocurrency, you’ve at least heard of Bitcoin (BTC). You may be less familiar with Bitcoin’s relative, Bitcoin Cash (BCH)—but there’s never been a better time to get acquainted! While Bitcoin cash is not represented with a unique currency symbol, it is sometimes referred to as Bcash. *Bitcoin Cash came to be through efforts to improve transaction speeds, confirmation speeds, and processing fees. Today, Bitcoin Cash is unique because it enables the blockchain to increase the number of transactions in a single block. Bitcoin cash is different from Bitcoin because it has reduced transaction fees significantly. Since more and more crypto users are participating in Bitcoin transactions, the transaction times have become a concern. Bitcoin’s technology needed to adjust to the demands of the network, and Bitcoin Cash was the solution. 

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What is Bitcoin Cash?

As you might imagine, Bitcoin cash is very similar to Bitcoin—in fact, Bitcoin cash is based on the original code that made the classic cryptocurrency famous. Bitcoin Cash is a fork, or spin-off, of the original Bitcoin software. Forks are implemented as a way to independently continue development, adding or improving on it’s its features and thereby creating a separate cryptocurrency. To accomplish its scalability goals, Bitcoin went through a hard fork targeting the efficiency of Bitcoin. Before this hard fork, the blockchain was limited by small block sizes. As of 2023, Bitcoin Cash’s blocks are thirty-two times larger than the original blocks, making transactions faster and more efficient.  Since its first hard fork, Bitcoin Cash has forked several more times to improve its functionality.

Comparing Bitcoin Cash (BCH) To Bitcoin (BTC)

How does BCH compare to BTC? Here is a summary of their key differences:

  • Both BCH and BTC operate on a blockchain. 
  • BCH has lower fees than BTC.
  • BCH has faster transaction times than BTC.
  • BCH supports more transactions per second than BTC.
  • BCH has larger blocks. While BTC’s blocks are 1MB, BCH’s blocks are 32 MB. 
  • BCH is favored for peer-to-peer transactions, while BTC is favored for everyday transactions.

The Bitcoin Cash Fork: The History Of Its Technology And The Groups That Made It Happen

The Bitcoin Cash fork occurred in August 2017 and is regarded as a significant event in the history of cryptocurrency. Its main motivation was the scalability issues that Bitcoin was experiencing (as noted above). To gain a deeper understanding of the fork’s history, you should know that there was (and continues to be) a long-standing debate on how Bitcoin should adjust its technology to solve this scalability problem. 

Some members of the Bitcoin community believed that the block size should increase to accommodate more transactions per block and improve efficiency. Other Bitcoin community members argued that the issue could be solved by shrinking the data that is necessary for processing each transaction. Though compromises between the two ideas were proposed, a portion of the Bitcoin community still believed that a straightforward block size increase was the solution. 

In August 2017, they initiated a hard fork, creating a new cryptocurrency called Bitcoin Cash (BCH). BCH had an 8MB block size limit (later increased to 32MB), which allowed for more transactions per block compared to Bitcoin.

How Bitcoin Cash Works

This 32MB block size increase has made a big difference. Let’s talk about the technology behind BCH, and dive into an explanation of its block size and faster transaction times.

One of the main motivations behind increasing the block size limit in Bitcoin Cash was to reduce congestion on the network during times of high transaction volume. By accommodating more transactions in each block, BCH aims to provide a smoother and more efficient user experience. 

Bitcoin Cash, like Bitcoin, relies on a Proof of Work (PoW) consensus mechanism, which was benefited by the fork as well. Miners compete to solve complex mathematical puzzles, and the first one to solve them gets to add a new block to the blockchain. With the increased block size limit, miners can include more transactions in each block, increasing the network’s transaction capacity.

The fork achieved its goal: the 32MB block size limit allows Bitcoin Cash to process a higher number of transactions per second compared to Bitcoin. This increased throughput can lead to lower transaction fees and faster confirmation times during periods of high demand.

How To Buy, Store, And Use Bitcoin Cash

So now that you know all about the technology, you are likely wondering how to buy and use BCH. You can buy Bitcoin Cash at RockItCoin’s Bitcoin ATMs or right on the website with credit or debit card. 

You will need to find a wallet that supports BCH before purchasing, so your assets have somewhere to go. The RockItCoin app is perfect for all of your crypto storage needs!. Other options for mobile wallets (hot wallets) and hardware wallets (cold wallets) are available. 

Advantages of Bitcoin Cash

The scalability advantages of BCH (like faster transaction times and lower fees) are important. They come alongside more advantages you should know about too. 

Improvements in accessibility are a key advantage. If you are looking for a cryptocurrency to use for small transactions or daily use, then BCH is a great option because of its small transaction fees. Bitcoin Cash is often favored for everyday transactions, such as buying coffee or making online purchases, due to its lower fees and faster confirmations.

Notable Developments and Upgrades

Since the hard fork in 2017 that led to the creation of Bitcoin Cash, the cryptocurrency has undergone several notable upgrades and improvements. These upgrades have been aimed at addressing various aspects of the network, including scalability, security, and functionality. 

Here is an overview of some of the key upgrades and improvements that Bitcoin Cash has undergone.

  • The initial hard fork creates Bitcoin Cash by increasing the block size.
  • In a subsequent upgrade, the block size limit was further increased from 8MB to 32MB, allowing for even more transactions to be processed in each block.
  • An upgrade in May 2019 implemented Schnorr signatures, which improve privacy, security, and efficiency in transaction processing. 
    • This upgrade enabled the recovery of funds sent to SegWit addresses, providing better interoperability with the Bitcoin network.
  • Simple Ledger Protocol (SLP)  improvements are underway. Development efforts have been directed toward expanding the capabilities of SLP tokens, enabling token creation and management on the Bitcoin Cash blockchain.
  • Smart contracts like CashFusion allow for greater privacy and security.

 Adoption and Merchant Acceptance

Thousands of companies accept BCH as a form of payment. Its adoption for everyday purchases continues to grow, and if you’re wondering where you can spend your BCH, you should know that an extensive range of businesses (from Twitch and Menufy to eGifter and LUSH) will accept BCH payments. 

Bitcoin Cash vs. Bitcoin (BTC)

The fork highlighted a fundamental difference in the vision for Bitcoin’s future. Bitcoin proponents favored a store of value similar to digital gold, with slower but more secure transactions. Bitcoin Cash supporters, on the other hand, saw it as a medium of exchange for daily transactions, with faster and cheaper transaction fees.

After the fork, Bitcoin and Bitcoin Cash went their separate ways. Each had its own development teams, communities, and market value. The split also resulted in some confusion and controversy, as the two cryptocurrencies shared a common history up until the fork. Since the fork, both Bitcoin and Bitcoin Cash have continued to evolve independently, with their unique communities and use cases. The debate over scalability and the future of Bitcoin’s blockchain remains a central issue in the broader cryptocurrency space.

Bitcoin Cash Community and Development

BCH has an active and passionate community that is dedicated to promoting its use as a digital cash system. This community-driven approach has led to ongoing development and improvements to the BCH ecosystem.  The BCH developer community actively works on improving the protocol. This includes addressing technical issues, optimizing performance, and proposing changes through Bitcoin Improvement Proposals (BIPs) or similar mechanisms. These updates aim to enhance the network’s scalability, security, and usability.

Roger Ver (CEO of Bitcoin.com), and Haipo Yang (CEO Of ViaBTC) have been active supporters of the development of Bitcoin Cash. Other Bitcoin developers have participated in and facilitated BCH’s forks, development, and accessibility since its inception in 2017. Since BCH is open-source, more developers are joining the network all the time, and the slow, steady growth has been fueled by the BCH community.

Future Prospects and Innovations

In the future, BCH will likely continue to play a role in the broader cryptocurrency ecosystem by contributing to the diversity and functionality of the blockchain space. The network’s larger block size limit allows for increased transaction throughput, which can be valuable in assessing the feasibility of scaling blockchain networks and points to a future of innovation inspired by BCH’s split from BTC. 

BCH offers users an alternative to BTC, which has a different approach to scaling and transaction fees. This provides users with a choice and allows them to select a cryptocurrency that aligns with their preferences for transaction speed, cost, and use case.

Bitcoin Cash has a dedicated community of users, developers, and advocates who promote its adoption and use as a digital cash system. This community-driven approach is an integral part of the cryptocurrency ecosystem, as passionate supporters play a role in shaping the narrative and development of cryptocurrencies.

BCH’s presence in the cryptocurrency market adds competition among digital currencies, which can help drive innovation, improve services, and incentivize other cryptocurrencies to enhance their features and user experience.

Bitcoin Cash stands as a prominent and evolving cryptocurrency within the broader digital currency ecosystem. Created as a result of a hard fork from Bitcoin in 2017, BCH aimed to address scalability issues and provide faster, lower-cost transactions. Since then, it has undergone several key upgrades and improvements, including significant increases in block size and enhancements to its transaction capabilities. Bitcoin Cash differentiates itself from Bitcoin by offering lower transaction fees, faster confirmation times, and increased scalability. It serves as a digital cash system, designed for everyday peer-to-peer transactions and small transactions. BCH has gained adoption among merchants and businesses, making it a viable option for real-world purchases.

The Bitcoin Cash community, supported by a passionate group of developers, actively works on protocol enhancements, infrastructure development, and user-friendly applications. This collaborative effort contributes to BCH’s ongoing growth and innovation. 

As BCH continues to evolve, it remains an intriguing cryptocurrency to explore and consider for various use cases. Staying updated on its developments and the broader cryptocurrency landscape is essential for anyone interested in the world of digital currencies. Whether you’re a supporter of Bitcoin Cash or simply curious about its potential, further exploration and engagement with the cryptocurrency community can provide valuable insights into its role within the ever-changing crypto ecosystem.