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Why Bitcoin Cash is much better than Bitcoin? Personal opinion!
When I heard for the first time about Bitcoin and then about Bitcoin Cash, honestly, I thought it is one and the same. Having the word "Bitcoin" in its name, I thought that BCH is just another abbreviation of Bitcoin. But no! There is a huge difference and each side tried to beat the other one. Even nowadays, there is a huge debate and the end cannot be seen at the horizon. Thus, I did hard research on this hard topic, especially on Bitcoin Cash and I really believe that BCH is better than BTC, actually much better, in terms of being a digital currency. This is the main topic of today's post and I will try to explain you, as much as I can based on my understanding so far, why BCH is much better than Bitcoin.
If you are a fan of Bitcoin Cash or like hearing more about Bitcoin forks, make sure to engage with me and exchange all type of materials so that I (and you) learn as many things as possible.
As I said above, in today's post I will talk about the differences between Bitcoin and Bitcoin Cash itself and why Bitcoin Cash is better at being a digital currency. Also, I am going to make a price prediction for BCH at the end of this post, because why not?! I like predictions and I had a huge success with my previous post My top 5 predictions for February. I will tell you where I believe this price can go.
I see on the Internet that many people are asking about Bitcoin forks and the first one to talk about is Bitcoin Cash. BCH started as a hard fork of Bitcoin in August of 2017 or at block 478559. The entire reason this fork happened was because of a disagreement in the community about the future of Bitcoin, especially in regards to several aspects of the protocol, namely block size, transaction time and scalability.
As Bitcoin grew in popularity and usage, the speed of the transactions became slower. The cost of those transactions became higher. This issue came to a head in 2017, when the number of transactions dramatically increased and network congestion caused Bitcoin's average transaction fee to climb to as high as $55 by the end of the year, some transactions taking hours and in some extreme cases days to finally confirm. This is the first time that the scalability problem that some had predicted for Bitcoin was actually experienced by those using the crypto. In order to address the scaling issue, a number of off-chain scaling solutions were suggested, including the Lightning Network, Segregated Witness or SegWit and various side-chain scaling options.
SegWit was designed to resolve the scalability debate by removing the digital signatures from the input instead moving it to the end of the transaction. In theory, this solution increases the 1MB limit of a block up to around 4MB. However, there were many that thought this approach would not work, including those who would eventually become part of the Bitcoin Cash community. They sought to keep scaling on chain and instead proposed that the block size be increased from 1MB to 8MB. Unable to come to a consensus about the best solution, miners initiated the hard fork of the Bitcoin protocol, created Bitcoin Cash in August 2017 and it was a frenzy.
This work of the protocol occurred just before the SegWit update which did slightly improve Bitcoin scalability by reducing the size of transactions, allowing more data to fit into the 1MB block and it allowed for second layer solutions for Bitcoin. Though the size of each Bitcoin block is limited to 1MB, there have been examples of blocks successfully mined that are larger than this due to the benefits of the SegWit upgrade. Bitcoin Cash on the other hand, now has a maximum block size of 32MB, which was increased from its original block size of 8MB during its first hard fork in May of 2018.
This change in block size significantly increased the number of transactions that can be included in each block and substantially increase the overall speed of the Bitcoin Cash network. It is important to note that even though the block size was increased, Bitcoin Cash maintains the 10 minute average block discovery time first implemented by the Bitcoin protocol. This means that transactions for Bitcoin Cash are confirmed in approximately the same amount of time, as Bitcoin. But because the transactions can be squeezed into each Bitcoin Cash block, the overall throughput of the Bitcoin Cash network is higher, around 100 transactions per second compared to only 7 TPS for Bitcoin.
Now, it did increase though to 14 TPS after SegWit of course, but still not that great. Aside from the larger block size and thus greater throughput of Bitcoin Cash, one of the main advantages the Bitcoin Cash has over Bitcoin has to do with the transaction fees. The highest transaction fee price for Bitcoin Cash was in January of 2018, when the average transaction fee was around 90 cents. However, the transaction fees have dropped considerably since then with the current transaction fee costing only a few cents. Bitcoin on the other hand had its highest transaction fees of around $55 in January 2018 and though the fees have gone down since then, transaction fees are still around five or six US dollar, significantly higher than Bitcoin Cash.
So, all this boils down to one thing: BCH is better than Bitcoin at being a currency. The original vision of Bitcoin was to be a peer-to-peer electronic cash system that allowed anyone in the world to send money to each other quickly and cheaply. However, due to the long block confirmation times in the high transaction costs, Bitcoin has fallen away from this original vision.
While for those of us blessed enough to be living in a first world country, $5 may not seem like that much money to pay to transfer money, but for those unfortunate people who live in third world countries, $5 could translate to a week's pay and that would be totally unsustainable as means of transferring money. One interesting thing to note is that in regards to price, Bitcoin and its forks like BCH almost mirror each other: when Bitcoin goes up, it is forced to go up with it, when Bitcoin goes down, it is follow suit and go down as well. There are many that say when Bitcoin goes down, all of the altcoins go down, but if you have you seen any of the recent altcoin market moves like Ethereum, UNI and Aave for example, you would have noticed that even when Bitcoin was retreating from 40k to 30k, these altcoins have been steadily increasing in value, with Aave obviously recently hitting an All Time High.
Now, if we take a look at some comparison charts between Bitcoin and Bitcoin Cash, it is clear to see that they follow each other closely. Take a look at the six month chart:
the three month chart:
the one month chart:
the seven day chart:
the one day chart:
It is undeniable that they look nearly identical. So, it goes without saying that the value of Bitcoin and its forks like Bitcoin Cash are tightly correlated. This means that if the bulls are right and Bitcoin is going to continue to rise in value, then, in theory, the Bitcoin forks like BCH will continue to rise as well. So, Bitcoin Cash is better than Bitcoin being a currency. I have established that and its value will also increase as well but for many projects it is easy to look back at their previous All Time Highs and make predictions for where they can go during this bull run. But for Bitcoin Cash that launched with an insane amount of momentum that made its previous All Time High kind of irrelevant to where the price can go from here.
Out of every project I have recently looked at, Bitcoin Cash does seem like the one project that may not be able to return to its All Time Highs. I believe that BCH will top out around $3.000. That is a little less than a 10x from here, but still not an All Time High.
You also have to keep in mind that the Bitcoin SV fork took away some of the Bitcoin Cash supporters, so that could limit its growth to some extent. I believe there is a lot of upside in the future, but beating its previous All Time High is probably not in store for this cycle. But hey you Bitcoin Cashers or Be Cashers can still dream.
Personally, I have not invested in BCH, but I follow closely this project and I have big hopes with it. With the help of people around here, I managed to raise some nice parts of BCH and I keep them on Celsius. It is like my little treasure and I am more than happy with it.
What are your thoughts on BCH? Do you think the Bitcoin and its forks will be forever tightly correlated or will they eventually break away from Bitcoin?