Since the creation in August 2017, Bitcoin Cash has gained a lot of popularity among traders around the world. This coin is a fork of BTC. Today we shall talk about what is Bitcoin Cash and what benefits does it have.
Learn more about cryptocurrencies: How to trade Litecoin.
What is Bitcoin Cash?
As we have already said, the Bitcoin Cash cryptocurrency is a fork of Bitcoin. It was developed by a group of users who disagreed with the consensus (BIP-91 and SegWit2x). BCH consists of some differences and adding new features that separate it from the original cryptocurrency. These include:
- Different Naming.
It might seem to be nothing special, but the addition “Cash” to the name encourages traders to use this cryptocurrency.
- Increased Block Size Limit.
Bitcoin Cash is already better for having an increased block size limit to 8MB. Many miners and developers advocated this for Bitcoin, but it all led to them creating a new altcoin.
- New Protection System.
Whenever Bitcoin Cash splits, both chains are protected from replay and wipeouts. This leads to minimal disruptions and lets both chains exist without any problems.
- A New Type of Transactions.
The developers have introduced a new kind of transaction as a part of the Bitcoin Cash protection system. This type has an input value signing, which improves hardware wallet security. It is also used to eliminate the quadratic hashing problem.
Want to know about BCH trading? Learn more about it in our How to trade Bitcoin Cash article!
Difference Between BTC and BCH
The main problem with Bitcoin was that the transactions stacked and had to wait for confirmation, which took a long time. The reason was the limitation of the block size, which had a maximum of 1MB. Bitcoin Cash has this problem solved by significantly increasing the block size. Here it is between 8MB and 32MB.To feel the difference, here is a simple example. Bitcoin has an average number of 1000-1500 transactions per block. During a stress test in 2018, Bitcoin Cash managed to work with 25000 transactions per block. The difference is huge.
Another point is that Bitcoin Cash does not use the Segregated Witness technology, which is used in Bitcoin. This is a solution to the increase in transactions per block. The technology only keeps the metadata, which is related to a specified transaction in one block. Usually, all the information related to a transaction is kept in one block.
We should also mention a similarity between BTC and BCH in the usage of the Proof of Work consensus mechanism to mine new coins, Bitmain as the largest crypto miner, and that they have the same supply cap, which is 21 million.
Bitcoin Cash Price
The price for 1 BCH in the middle of February was near $400 United States Dollars. At the moment this article is being written, the price is at a starting downtrend after one month of constant growth in value. This is a good time to sell.
We hope you found this article to be useful. If you have any other questions, we recommend reading all out other articles!