One of the things that confuses newcomers to the cryptocurrency ecosystem is that many Bitcoins that exist.
Are there more than one Bitcoin?
Are they the same thing?
If not, why all of them named Bitcoin?
These are usually some questions that trouble a cryptocurrency newbie.
The short answer is no. They are not the same thing. All of them derived from the original Bitcoin that's created in 2009, so they do share some of the main properties and the name, but they also have their differences. Some of them are practical and technological and others ideological.
The first of these Bitcoin forks is called Bitcoin Cash that was created on the first of August 2017.
But what led the community to create a new coin and what new property does it bring to the table?
Well, that's what will I address in this article.
What is Bitcoin Cash (BCH)?
One of the major criticism of Bitcoin is that it's too slow. And in times of high volume, these can get very expensive. This is the famous scalability problem that has been tantalizing the most famous cryptocurrency ever since it became more widely used.
This particular issue has sparked quite heated argument within the Bitcoin Community. And when a consensus on the proposed solution couldn't be reached, each faction implemented the solution that they thought was the best one.
So on August 1st, 2017, part of the community started following one set of rules while the rest follows another. This creates a split in the chain that resulted in two separate chains and two separate coins - Bitcoin, which kept the abbreviation BTC and Bitcoin Cash which receive the ticker BCH.
In order to understand the disagreement, we need to see what causes the scalability problem.
So transactions on the blockchain are confirmed when they're added to a block. The Bitcoin block is found every 10 minutes on average and mining is tend to prioritize the transactions with the highest speeds. But because of block has a limited size of just 1 megabyte, only a certain amount transactions can fit into one. So when all transactions can't fit into the next block, the result is delays and increased fees.
The Bitcoin Cash faction proposed that the problem be solved by increasing the block size to 8 megabytes and subsequently to that to 2.
Mega Blocks mean that more transactions can fit into them leading to faster confirmations and lower fees. But the Bitcoin faction wanted to keep the block size the same and it said reduce the size of the transaction. So this would also allow for the development of the Lightning Network - a second layer solution that actually increases scalability even further.
Bitcoin Cash was created with the aspiration to be the Bitcoin version that accommodates day-to-day transactions like cash as the name suggests. This was seen as the original promise of Bitcoin which Bitcoin Core had failed - High transaction rates and low fees.
Bitcoin cash transactions always get included in the next slot and the fees are usually a fraction of a cent. Most services actually accept Bitcoin Cash because it has zero confirmation. So this means that they actually accept a transaction as soon as it sent even if it hasn't been confirmed yet.
What's the catch?
Making transactions and practically instantaneous, but that includes a small amount of risk and for this reason it's usually only acceptable for small amounts. These are the main advantages for Bitcoin Cash plus the fact that as of November 2018, Bitcoin Cash support smart contracts as well. Their usage is not as widespread as on Ethereum and they tend to provide less functionality, but they can certainly bring new users to bitcoin cash even as a DeFi platform. But this new feature wasn't without its own controversy either, and actually led to Bitcoin Cash undergoing its own Fork that gave birth to Bitcoin SV, where SV means Satoshi's Vision
BSV, besides not supporting smart contracts also increase the block size further up to 128 megabytes. Bitcoin Cash critics, however point out that BCH blocks are rarely larger than 1 Megabyte and the actual block space has never really been used. This is actually mainly because BCH never quite gathered the widespread adoption by the community. They had initially hoped for nor did it overthrow Bitcoin as the true Bitcoin. And they also argue that the bigger block offer only a short time solution to scalability but long term they may pose threats to our security and actually proved unsustainable altogether, not to mention the argument that they favored centralization.
But BCH is unarguably one of the top cryptocurrencies and accepted by many merchants and companies for everyday transactions. Although its liquidity is nowhere near to BTC which is actually for some exchanges to delist several BCHs.
The truth is there's no love lost between BTC and BCH, but the animosity between the different Bitcoin cab is of little interest in most cryptocurrency users anyway, not to mention the argument as to which one is the true Bitcoin.
This along with the use of the term Bitcoin by so many coins only adds to the confusion newcomers face and hinders wide adoption.
My say.
The important thing to remember is that each has a different cryptocurrency with some similar and some unique properties and use cases and there is a one that fits all. So if you are someone who's interested in sending or receiving many small transactions quickly and cheaply or if you're interested in a smart contract on house built by Bitcoin platform, then Bitcoin Cash is probably a coin worth looking into.
Lead Image:
https://cafebitcoin.org/roger-ver-bitcoin-cash-bch-co-the-tang-gap-1000-lan-gia-tri-hien-tai/
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