There are several cryptocurrencies in the market, but one of the largest is Bitcoin Cash. If you are already wondering “What is Bitcoin Cash (BCH)?” in this article we will share with you all the must-known details and information you should know about this cryptocurrency.
In the last few weeks, we have been writing a guide about each of the most popular cryptocurrencies in the world that would definitely be very useful for you to learn about this industry and how it is currently expanding.
What is Bitcoin Cash (BCH)?
Bitcoin Cash (BCH) is one of the largest virtual currencies in the world. Currently, Bitcoin Cash has a market valuation of $4.38 billion and it was able to become the 5th largest digital asset in the world.
No, it is not Bitcoin (BTC), but it has been created after it. Indeed, Bitcoin Cash was created back in 2017 as a hard fork from the Bitcoin network. We will come back to it in the coming sections.
Compared to Bitcoin, it has a few important differences that make of it better in some parameters than Bitcoin. However, it has not been widely adopted by the BTC community, instead, it was mostly adopted by a smaller group of individuals – which are now expanding and becoming a more important community in the space.
Bitcoin Cash Creation
As we have mentioned before, Bitcoin Cash is a hard fork from Bitcoin. That means that in a certain point in time (in mid-2017), a group of miners decided to move away from the Bitcoin network and continue to mine blocks on a parallel network called Bitcoin Cash.
BTC and BCH supporters have been arguing about which should be the “leading” Bitcoin in the market. Of course, Bitcoin Cash has some differences from Bitcoin and this is a very important point we should talk about.
Basically, Bitcoin Cash and Bitcoin followed different paths due to a lack of consensus on how to scale the Bitcoin network. While Bitcoin Cash proponents preferred to use on-chain scaling solutions, Bitcoin supporters were focusing on off-chain solutions.
Bitcoin Cash vs Bitcoin Differences
In order to better understand “What is Bitcoin Cash (BCH)?” we need to know which are the differences between BCH and BTC. As we have suggested in the paragraph above, BTC and BCH have a different approach to scaling.
While Bitcoin is currently using blocks with 1 megabyte of size, Bitcoin Cash decided to add more megabytes to its blocks in order to have faster and cheaper transactions. Indeed, BCH has 8 MB blocks compared to 1 MB blocks of Bitcoin.
Each of the transactions you made using BTC is sent to the miners that must approve them. In this way, they will be added to a block. Of course, each block has a limited amount of transactions that can be added, meaning that if there is a large number of transactions in a certain period of time, it could become difficult for miners to process al the transactions requested by users.
When there is a large queue of transactions waiting to be processed, the fee for miners becomes an important feature to take into consideration. Large exchanges, companies and users that want to process a transaction in the next block, will definitely pay for a higher fee and the transaction will be processed smoothly.
Instead, if a small user wants to process a small transfer with a low or standard fee, it may wait not just some hours but even days before the miners will process the transfer. This is why it is so important to understand how the system works.
Bitcoin Cash does not have this problem considering it has a lower number of transactions and it has also more space per block, meaning transactions fees are usually similar and low. Moreover, there is no congestion and transfers take place just a few minutes after being processed by the user.
Bitcoin Cash is one of the most popular cryptocurrencies in the market. It was created due to a philosophical and technical discussion with BTC supporters on how to properly scale the network. It is worth pointing out that BCH has also experienced a hard fork on its own network with Bitcoin Satoshi Vision (BSV) at the end of 2018.
Of course, many users in the community will be defending one side or the other side, however, it is always important to remain united in the crypto space. At the end of the day, will be the market and the users that will decide which network is more useful or not.