What is Bitcoin Cash?
As bitcoin gained popularity, the network started being flooded with more and more transactions. This network congestion resulted in some delays to transactions and high transaction fees to send or receive Bitcoin.
The Bitcoin community couldn’t come to a solid consensus to combat the issue and as a result, Bitcoin underwent a hard fork, and Bitcoin Cash was formed.
Bitcoin Cash is a blockchain-based, peer-to-peer electronic cash transfer platform, formed after a hard fork within the Bitcoin protocol. The Bitcoin Cash platform created BCH, as it’s native cryptocurrency.
This all might be a bit baffling and leave you wondering which crypto coin is the ‘true’ Bitcoin? Why are forks created? Don’t worry, we’ll explain this shortly.
What are forks?
Bitcoin is a decentralised platform. As a result, the blockchain protocol is upgraded by voting on suggested updates.
However, when a group of people are not satisfied with the suggested improvements or changes, they can come together to create their alternate version of the blockchain. This alternate version of the original blockchain is called a ‘fork’. There are two different types of forks, soft and hard.
Soft Forks
Soft forks are backward-compatible, meaning these alternate versions are compatible with the original blockchain.
Hard Forks
Hard forks aren't backward compatible. These forks do not support the original version, in this case Bitcoin (BTC). Bitcoin Cash is an example of a hard fork.
Bitcoin Cash features
The number of transactions on Bitcoin Cash’s blockchain can be as high as 25,000 transactions per block in comparison to Bitcoin’s approximate 2,205 transactions per block.
Bitcoin Cash is mostly similar to Bitcoin with some key differences. Let’s look at some notable differences between Bitcoin Cash and Bitcoin:
- Bitcoin Cash has a larger block size. It started with an 8mb block and later upgraded to 32mb block.
- Bitcoin Cash does not employ the SegWit or the Lighting Network.
- Bitcoin Cash has lower mining difficulty.
As a result of additional issues with lack of consensus on direction, in November 2018 Bitcoin Cash underwent an additional fork to split into Bitcoin Cash (formerly known as Bitcoin Cash ABC) and Bitcoin SV.
