Bitcoin Cash is a unique cryptocurrency developed in 2017. It is a proof of work blockchain network that is faster than Bitcoin. Bitcoin is the most well-known cryptocurrency in the market, and we all have heard a thing or two about it. However, there have been questions regarding its ability to scale since its development.
You know that bitcoin transactions are verified, processed, and stored in a blockchain. Blockchain is a public Ledger that made it difficult to manipulate the network for malicious actors. It is a secure network; it exists on many computers worldwide. When it comes to the bitcoin network, you will experience slow transactions. At the same time, popular credit card companies process up to 150 million transactions per day; Bitcoin transactions seem very slow.
Bitcoin (BTC) and bitcoin cash (BCH) are similar namesakes but unique cryptocurrencies. In the following, you will talk about how bitcoin cash works and everything you need to know before investing in this cryptocurrency.
What Is Bitcoin Cash?
Bitcoin Cash or BCH shares some characteristics of Bitcoin, but some features make it apart from Bitcoin. Developers created Bitcoin Cash as a form of a fork of Bitcoin. Due to the scalability problem of Bitcoin, it went through a fork and created three popular types of Bitcoin cryptocurrency.
The three most popular types of Bitcoin are called Bitcoin (BTC), Bitcoin Cash (BCH), and Bitcoin Gold (BTG). You can find all of them on Bitunivex, one of Australia’s most powerful crypto exchange platforms.
Bitcoin Cash aims to cut the hands of certain people from controlling Bitcoin. BCH increases the size of bocks to process more transactions and solve the problem of scalability.
The History of Bitcoin Cash
An individual or a group of people going by the pseudonym Satoshi Nakamoto created the first bitcoin block in 2009. Bitcoin became one of the most popular cryptocurrencies, but it suffers from scalability issues. That is why Bitcoin Cash comes into play. It aims to solve the problem of long transaction times in Bitcoin. Bitcoin network splits into two at block 478558.
Miners and developers who have decided to fork the Bitcoin believed that bitcoin is a medium for digital transactions and not just a store of value. But when it takes minutes or even hours to confirm a transaction in Bitcoin, how could that happen?
Bitcoin Cash was a great solution, but it had its forks, Bitcoin Cash ABC (BCHA) and Bitcoin SV (BSV).
Bitcoin Cash ABC has the same features as Bitcoin Cash, but this network reinvests 8% of lock rewards innervation. 8 % of the reward acts as a salary for the open-source developers.
Bitcoin SV, also known as Bitcoin Satoshi Vision, offers even bigger block sizes than Bitcoin Cash. An Australian scientist, Craig Wright, created this cryptocurrency. Bitcoin SV or BSV verifies up to 9000 transactions per second and can store 16.4 million transactions in one block.
How Does Bitcoin Cash Work?
The main difference between bitcoin and Bitcoin Cash is philosophical because they work the same. Both of them have a limited supply of 21 million assets and use nodes to validate transactions. Both of them operate on a proof of work consensus algorithm.
On the other hand, BCH verifies transactions faster, and you must pay lower fees in this network. Bitcoin Cash tries to solve the problems of Bitcoin by increasing the size of blocks to 32 MB. While Bitcoin proposed 1000 and 1500 transactions per block, Bitcoin Cash processed 25000 transactions per block.
What is Bitcoin vs. Bitcoin Cash?
You know that Bitcoin Cash can support 25,000 transactions blocked while the famous Bitcoin can support 1000 to 1500 transactions per block. This made Bitcoin Cash one of the most popular bitcoin forks on the market.
- Bitcoin Cash increased the block size from 1 MB to 32 MB.
- Bitcoin can process 3 to 7 transactions per second, why Bitcoin Cash can manage up to 200 transactions per second.
- Bitcoin Cash transaction fees are lower than that of Bitcoin.
- BCH uses smart contracts to perform more complex functions than transactions. This feature allows Bitcoin Cash to operate decentralized finance applications such as CashShuffle and CashFusion.
Use Cases of Bitcoin cash
Considering all the great features of BCH, it can be regarded as a long-term store of value.
The total supply of Bitcoin cash is 21 million coins, and it’s not going to change. Bitcoin cash is a great peer-to-peer payment system between individuals, and it can be used just like cash. It is interesting to know that you have to pay less than a penny per transaction in this network.
One of the most notable features of Bitcoin cash is that it is an alternative form of money that supports economic freedom.