Table of Contents:
- Introduction
- What is Bitcoin Cash?
- History of Bitcoin Cash
- Why do you need to use Bitcoin Cash?
- Bitcoin VS. Bitcoin Cash
- How to get Bitcoin Cash?
- Future of Bitcoin Cash
- Conclusion
Tired of waiting for Bitcoin transactions to get confirmed? Bitcoin Cash might be a good solution that you are looking for. Bitcoin Cash is designed to improve Bitcoin’s scalability issue and promises faster and cheaper transactions. But how does it work and why is it different from Bitcoin? In this blog, we will dive into the world of Bitcoin Cash and explore how it is changing the aspect for cryptocurrency users.
What is Bitcoin Cash?
Bitcoin Cash (BCH) is a form of Bitcoin that was designed to do more transactions quickly and at a lower cost. It was developed in the year 2017 when some developers sought to make improvements in the speed and scalability of Bitcoin. By allowing an increase in block size, Bitcoin Cash can actually process more transactions in each block, so it’s faster and cheaper to use, especially for daily payments. Although it has many features similar to Bitcoin, the main difference is its higher capability to process more transactions, which will make it more viable for those who need faster and cheaper transfers.
But how did the idea come from? How was Bitcoin Cash created? Let’s dive into the history.
History of Bitcoin Cash:
The history of Bitcoin Cash (BCH) begins with a discussion in the Bitcoin community on how Bitcoin could be made faster. In 2017, Bitcoin’s network had slow transaction times and high fees because of its 1 MB block size limit. This became a major issue as Bitcoin’s popularity grew, limiting its efficiency for everyday use.
To address this, two main solutions emerged. One group proposed the update of Segregated Witness (SegWit), which would make transactions smaller and slightly increase the block size without changing the structure of the blockchain. Another group argued for a direct increase in the block size to allow more transactions per block.
This disagreement led to a hard fork on August 1, 2017, making Bitcoin Cash distinct from the other cryptocurrencies. Bitcoin Cash began with a block size of 8 MB, which later grew to 32 MB. This change helped make transactions faster and fees lower compared to Bitcoin. Over time, Bitcoin Cash had its own splits, like Bitcoin SV in 2018, which divided the community even more. Even with difficulties, Bitcoin Cash is still a popular option for people wanting a quicker and more scalable choice than Bitcoin.
Bitcoin Cash (BCH) is designed to address some limitations of Bitcoin, offering faster, cheaper, and more efficient transactions. Now the question is, why will you use Bitcoin Cash? What are the key features of Bitcoin Cash? Is it really profitable and less time consuming? Let’s figure it out.
Why use Bitcoin Cash?
1. Fast Transactions:
With Bitcoin Cash, sending money is faster because it has a higher block size, currently 32 MB, while Bitcoin has 1 MB. This means that it can fit more transactions in each block, thus reducing the wait time.
For example, suppose that you are in a coffee shop and want to pay with Bitcoin. It may take more than 10 minutes with Bitcoin, but with Bitcoin Cash, it takes just a few seconds to a couple of minutes. This makes Bitcoin Cash more practicable for small, day-to-day purchases.
2. Lower Transaction Fees:
Bitcoin Cash has lower fees preformed than Bitcoin does, which is excellent news for those who need to make multiple or small transactions. While the transaction fee of Bitcoin can be a few dollars or more, the processing of Bitcoin Cash usually costs less than one cent.
For example, if you send $5 to a friend using Bitcoin, you may have to pay a $3 fee that is almost the same as what you are sending! But with Bitcoin Cash, it could be less than a penny, therefore way cheaper for small payments.
3. More Scalability:
Bitcoin Cash has a larger block size, which means it can process more transactions at once. This ability to grow makes it good for big uses like online shopping or across countries without having to wait.
For example, imagine an online shopping sale where many people are paying at the same time. Bitcoin Cash can manage many more of these payments at once than Bitcoin, which means no one has to wait for their order to be confirmed.
4. Peer-to-Peer Payments:
Bitcoin Cash aims to be a real peer-to-peer electronic cash system. People can send money directly to one another without needing a bank or middleman; it is a decentralized currency that grants more control to the people.
For example, sending money to a friend in another country usually requires the use of a bank. This may take days and cost you a lot in fees. Using Bitcoin Cash, you can send money directly to your friend’s wallet immediately with very low fees.
5. Reliable for Microtransactions:
Because of Bitcoin Cash’s minimal transactional fees and fast block processing time, it can be great for micro-transactions, or an extremely small payment.
For example, if you want to pay for a small amount of data-say, a pay-per-view article or a few minutes of Wi-Fi, then Bitcoin Cash can help. Through regular methods, such a minute amount of transfer would prove cumbersome with regard to the fees involved and the time required.
6. Secure and Decentralized:
Similar to Bitcoin, Bitcoin Cash is both secure and decentralized, with no single person or government owning the network. Transactions are validated and added by a huge number of computers all over the world called miners, which maintains the system fair and open.
For example, unlike the use of a credit card whereby personal information is kept by companies and can be subject to hacking, Bitcoin Cash transactions are secure and don’t require sharing personal details. In so doing, Bitcoin Cash presents itself as a safer way of transacting money online.
Bitcoin (BTC) and Bitcoin Cash (BCH) are two cryptocurrencies with a common origin but significant differences in their design, functionality, and philosophy. Below, we’ll explore the detailed differences between Bitcoin and Bitcoin Cash.
Differences between Bitcoin and Bitcoin Cash:
| Feature | Bitcoin (BTC) | Bitcoin Cash (BCH) |
| Launch Date | January 3, 2009 | August 1, 2017 |
| Purpose | Digital currency, store of value | Digital currency, faster and cheaper transactions |
| Block Size | 1 MB | Initially 8 MB, now 32 MB |
| Transaction Speed | Slower (10-60 minutes for confirmation) | Faster (few seconds to a couple of minutes) |
| Transaction Fees | Higher (can range from a few dollars to more, especially in busy periods) | Lower (typically less than 1 cent) |
| Scalability | Limited scalability due to small block size (1 MB) | Higher scalability due to larger block size |
| Consensus Mechanism | Proof of Work (PoW) | Proof of Work (PoW) |
| Market Value | Higher market value and wider adoption | Lower market value but growing in use |
| Block Time | 10 minutes | 10 minutes |
| Mining Algorithm | SHA-256 | SHA-256 |
| Main Use Cases | Store of value (often compared to “digital gold”) | Peer-to-peer cash system, daily transactions |
| Segregated Witness (SegWit) | Yes, implemented to help compress transactions | No, does not use SegWit |
| Lightning Network | Supported (for off-chain scaling solution) | Not supported, relies on on-chain scaling |
| Adoption | More widely adopted with larger market cap and brand recognition | Growing but less adopted compared to Bitcoin |
| Forks | Original blockchain with several forks (e.g., Bitcoin Cash) | Fork of Bitcoin, also had a split (Bitcoin SV) |
| Decentralization | Highly decentralized, with a vast network of miners globally | Also decentralized, but with a smaller network |
| Vision | Prioritizes security, decentralization, and a store of value | Prioritizes speed, low fees, and daily transactions |
| Smart Contract Support | Limited (through secondary layers like RSK) | Limited but under development for dApp potential |
| Community Support | Strong, with a global user base and institutional backing | Strong, particularly among those prioritizing fast, low-cost transactions |
Source: bitpay.com
Bitcoin focuses more on being a secure, decentralized store of value, often called “digital gold.” Its smaller block size limits its transaction speed and scalability, but it remains the most popular cryptocurrency with a large market cap.
Bitcoin Cash was created to solve Bitcoin’s scalability issues by increasing the block size. It allows faster, cheaper transactions, making it more practical for everyday use, but it has a lower market value and adoption compared to Bitcoin.
But how will you get the Bitcoin Cash? Here’s a short, step-by-step guide on how to buy or get Bitcoin Cash (BCH).
How to get Bitcoin Cash?
Buying BCH on Exchanges:
It’s possible to purchase Bitcoin Cash from crypto exchanges, such as Binance, Coinbase, Kraken, or even KuCoin. You can create an account there, deposit cash in, and exchange for BCH.
Mining:
Personal Computers:
It is possible to mine BCH using a personal computer equipped with special graphics cards. This, however, is an inefficient way, and the investment hardly generates any profit due to great competition and low rewards.
Mining Pool:
Participation in a mining pool to increase your rewards. Pools amalgamate resources from multiple miners and distribute the rewards according to one’s share, but the earnings at a personal level can be very low.
ASIC Miners:
The usage of an ASIC (Application-Specific Integrated Circuit) miner, which is built for mining BCH, is faster than personal computers by a great deal. Although new ASIC miners are rather expensive, used ones can be bought for lower values. Used ASIC miners may have lower performance, and their condition might be unknown.
Future of Bitcoin Cash:
The future of Bitcoin Cash (BCH) hinges on its ability to maintain and enhance its core advantages, faster transaction speeds and lower fees, while navigating challenges such as competition from other cryptocurrencies and market adoption. As the cryptocurrency space evolves, Bitcoin Cash aims to improve its scalability and utility for everyday transactions, potentially increasing its use in retail and online payments. Ongoing developments and innovations, such as improvements in transaction efficiency and integration with emerging financial technologies, could strengthen its position. However, its success will depend on its ability to adapt to changing market conditions and user needs, as well as its ability to differentiate itself from Bitcoin and other blockchain projects.
Bitcoin Cash offers a compelling alternative to Bitcoin with its focus on faster transactions and lower fees, making it a practical choice for everyday payments and microtransactions. As it continues to evolve and address scalability issues, it could play a significant role in the future of digital cash.
Are you considering using Bitcoin Cash for your transactions or investments? Share your thoughts and experiences in the comments below!
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