What is Bitcoin Cash (BCH) and what are its main advantages?

Bitcoin cash (BCH) is electronic cash that flows quickly and at low cost person-to-person. These characteristics convinced many investors to use it for their transactions. It is a cryptocurrency that is considered a fork of Bitcoin (BTC), and it cannot be forgotten that Bitcoin is the first and best known cryptocurrency. For its part, Bitcoin Cash proposes a different scaling to the Bitcoin base code whose main difference with this cryptocurrency is the size of the block.

It was launched on the market on August 1, 2017 after multiple tests on its operation and with its most outstanding feature: a blockchain length of 8 MB. At the beginning, it greatly outperformed Bitcoin, whose length was limited to 1 MB. Until today it has evolved, with more than 7 updates and has increased the limit of unconfirmed chained transactions from 25 to 50 per second. This speed places it in an important place within cryptocurrencies.

What is Bitcoin Cash (BCH)?

Bitcoin cash BCH is a type of cryptocurrency that emerged as a fork of Bitcoin. With this cryptocurrency, a way was sought to have longer blockchains or blockchains that would allow more transactions to be carried out in less time. This fork arose from disagreement between Bitcoin's creators to increase the block size limit of the first cryptocurrency. Bitcoin Cash has been presented as a more scalable cryptocurrency, with reduced transaction fees and faster confirmation times.

Unlike Litecoin, which tries to act as a brother to Bitcoin, Bitcoin Cash is the direct competitor of Bitcoin. Its uniqueness comes from its scaling solution being increased block size rather than Bitcoin's SegWit or Lightning Network. At the moment, Bitcoin Cash can process up to 61 transactions per second and a maximum of 21,000,000 coins. It is the third cryptocurrency after Bitcoin and Ethereum within the scope of market capitalization.

How does Bitcoin cash (BCH) work?

The way a user works with Bitcoin cash is no different from the way BTC is handled. Bitcoin cash has been intended to be used as a payment method. It uses a peer-to-peer network that is protected by the structure of the proof-of-work algorithm. It is also protected by miners who use it to confirm transactions. Utilizing the mechanism called Proof of Work, it gives miners BCH as a reward for their computing power

In 2019, Bitcoin Cash implemented a technology called Schnorr Signatures, an alternative algorithm that changes the way digital signatures are used. Schnorr's signature scheme is simple and secure, and provides greater privacy and scalability than the ECDSA scheme currently used by Bitcoin. Another key factor in its performance is the block size limit, which was initially increased from 1MB to 8MB and then increased again in 2018 to 32M

What future do you have in the cryptocurrency market?

When it comes to Bitcoin Cash, the Bitcoin community is divided as to its future. BCH has a maximum supply of 21 million coins and a quantity in circulation of more than 18 million of them. And it currently has approximately a $ 13.5 billion market capitalization with growth potential. So today it is one of the most popular cryptocurrencies. It is currently among the 15 largest cryptocurrencies in terms of market capitalization.

Although it has risen to prominence, we must not forget that the cryptocurrency market is volatile. Strong fluctuations are not uncommon here and therefore make it difficult to provide an accurate analysis. However, the main experts and supporters of the BCH expect a significant price increase whose percentage range will reach triple digits during the period 2021-2025. But its detractors consider that its mining is less profitable so that it will reach its maximum peak in 2022 by then fall drastically.

What differences does it present with respect to Bitcoin?

One of the most striking differences between Bitcoin and Bitcoin Cash is the size of the block, which makes transactions faster. Bitcoin Cash tried to find a faster solution to the speed of transactions by increasing the block size from 1MB to 8MB and later to 32MB. Larger blocks can contain more transactions. When compared to Bitcoin blocks, this cryptocurrency handled between 1,000 and 1,500 transactions per block, while Bitcoin Cash was able to handle up to 25,000 transactions per block.

Another difference is the encoding algorithm. Bitcoin Cash is different from Bitcoin. Bitcoin Cash uses the Eda algorithm. If Bitcoin Cash breaks down in the future, there is a plan in place to protect against such attacks and crashes. In this way, it is believed that if a new fork occurs, the two chains can coexist with minimal interference for all involved. This algorithm helps the blockchain work properly when the number of miners changes drastically.

Advantages of Bitcoin cash (BCH)

Bitcoin cash stands out in the cryptocurrency market due to the advantages it possesses, which makes it attractive for investors looking for decentralized options. Today it continues to be a market giant for several reasons: its excellent positioning that facilitates better negotiations. In addition to the speed of your transactions, as well as their low costs. The stability of BCH with its characteristics of ease of use, intuitive mode, reliability and fluidity of the network make it a widely used currency among cryptocurrency users.

Another important advantage is the security that covers it. This is due to the hardware and its software structure, thanks to the quadratic hash it uses. We cannot fail to mention the guarantee of its blockchain technology and its evolution that includes seven updates, which affects its value. In addition to this, another of its advantages is the protection against the repetition of the data chains, this characteristic avoids its long-term instability.

Disadvantages of Bitcoin cash (BCH)

Despite its excellent positioning, Bitcoin cash has some disadvantages. Among them is the use of larger blockchains or blockchains, which implies that the centralization of this cryptocurrency is stronger. That is, it requires more storage hardware so due to its high costs only large companies and not small miners will be able to mine BCH and obtain good profits. Its volatility makes it not recommended for long-term savings because, just as its value has substantially positive changes, there is also the risk of losing.

It should be noted that its characteristic of not being able to trace makes it easy to move around, but if there is an error in the transaction, it will not be possible to recover the money sent. Also, in some countries they only accept it as a marginal currency and in others cryptocurrencies are not even accepted. This makes exchange difficult in some places, so care must be taken when carrying out transactions. Although Bitcoin cash is classified as a free and decentralized currency, it is currently subject to regulations in some countries.

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