What is the difference between Bitcoin Cash and fiat currency like USD or PHP?

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Avatar for Telesfor
2 years ago
Topics: Bitcoin Cash, BCH, Money

After a discussion it with a read.cash user, I realized that many don't understand the difference between Bitcoin Cash and a fiat currency like USD or PHP. Many know only that Bitcoin Cash is a cryptocurrency, a digital currency, that you need a wallet for it and that you can trade with it on the exchanges.

What is fiat money?

To understand the difference, one must first properly understand what a fiat currency is. The first misunderstanding starts with the fact that many think that currencies such as USD, EUR or PHP are backed by gold, oil or other goods. But that's not true. The fiat currencies are not backed by anything. It used to be that way, but it was lifted in 1976 at the latest. Everyone can read it here:

https://en.m.wikipedia.org/wiki/Gold_standard

In reality, the fiat money is created out of thin air at the banks (especially central banks, but also private banks). This money is lent to other banks, companies, governments or private individuals in the form of loans. You can read more about this here.

https://en.m.wikipedia.org/wiki/Money_creation

Because this article is quite complicated and maybe not everyone can understand it, to simplify matters, one can say that fiat money is nothing other than debt. The money that you have in your account, or as a banknote, is nothing more than the debt of someone who has taken out a loan.

What's the problem with the fiat money? There is very, very much of it because there is so much debt. There are many countries that are very indebted. USA is very indebted, many countries in Europe are very indebted, Japan is very indebted. Countries have to repay the debt, but they don't have the money to do it. So what are they doing? They take on new debts to pay off old debts. This is called a debt spiral. The result: more and more fiat money is being created.

Such phenomena have happened many times in human history. Most of the time, they end in hyperinflation and creating a new monetary order. The old money is largely declared invalid. The government can void the money overnight (it happens without notice, of course, so people don't immediately spend the old money as long as it is worth something)

Will it happen this time? Nobody knows, but it is likely.

What is Bitcoin Cash?

Bitcoin Cash is a cryptocurrency that was developed as an alternative currency by Satoshi Nakamoto in 2009 (at that time still under the name Bitcoin) in response to the 2008 financial crisis. In 2008, the world was on the verge of a financial collapse. With money, everything is based on trust. In 2008 the banks lost confidence in each other because each bank feared that another bank would be insolvent. Many banks were no longer able to act because they could not borrow money. You have to know that no bank has as much money as is deposited in the customer's accounts. If all customers want to withdraw their money at once (so-called bank run), every bank is broke in no time. That is why Satoshi had a brilliant idea to develop money that is independent of governments and central banks and is crisis-resistant.

Bitcoin Cash is not created by the central bank or governments, but by miners. And best of all, anyone can become a miner. Everyone can create their own Bitcoin Cash. In the past you could do it with your own computer. Today you have to join a miner's pool.

The software that creates Bitcoin Cash ensures that only 6.25 BCH are created per block. In the beginning it was 50, later 25, then 12.5. In the future, fewer and fewer BCHs will be created per block. This ensures that the amount of Bitcoin Cash does not grow uncontrollably. So it is different from fiat, where more and more are created. Each block is created every 10 minutes on average.

You don't need a bank that can go broke to store Bitcoin Cash. All you have to do is write down your seed. That's all. To make a transaction you only need a wallet. I have described how a Bitcoin Cash wallet works here. Nobody can take away or invalidate your Bitcoin Cash. A government can ban exchanges but it is absolutely unthinkable that all governments in the world ban exchanges. There is also https://local.bitcoin.com that nobody can forbid. You need only internet access and a device.

Why BCH and not BTC?

Why do I write that Bitcoin Cash BCH and no longer Bitcoin BTC is the cryptocurrency that can serve as an alternative world currency? Unfortunately, the developers of the Bitcoin Core software decided to keep the Bitcoin BTC block size at 1MB. Bitcoin BTC can only process 6 transactions per second. That is far too little. Some transactions are already waiting weeks for confirmation. That means you have to wait weeks for the money. How is it supposed to work when there really should be a lot of people using BTC? The Bitcoin Core developer are probably not interested in developing Bitcoin in the sense of Satoshi Nakamoto. They have created a speculative asset. That's why Bitcoin was forked and so I no longer use BTC.

Note: I have deliberately made a lot of things very simplified so that the article is understandable for as many users as possible

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+ 6
Avatar for Telesfor
2 years ago
Topics: Bitcoin Cash, BCH, Money

Comments

I have so much things to know about the crytocurrency world. Its quite complicated for me as a beginner, but with this article I gained information. Thanks!

$ 0.00
2 years ago

BCH will be the ultimate winner that i am sure !

$ 0.00
2 years ago

This is really an in-depth explanation of the two terms.... I believe after reading this, people will get to really understand the differences.

$ 0.00
2 years ago

Thank you so much sir. Your article is so amazing. I can know about difference between Bitcoin cash and USD.

$ 0.00
2 years ago

Dear @Telesfor sir, first I am so sorry to interrupt to you here. I'm in a little trouble. I withdrew 3.1 USD in my bitcoin cash wallet in the morning (00.30, GMT 00) in coinbase. But I have not received the pending notification yet. But there is no money in my read.cash account. I don't know what's the problem is. Please suggest me what can i do? Thanks in advance sir.

$ 0.00
2 years ago

If I understand you correctly, you have sent from read.cash BCH to coinbase wallet and the coinbase wallet does not show whether the funds have arrived. I don't use coinbase wallet, but it is an exchange online wallet and I know that such wallets sometimes wait a lot of confirmations until the money is credited. You just have to wait. It is best not to use something like that. I use bitcoin.com Wallet. There the transaction is displayed immediately.

$ 0.00
2 years ago

I got the transaction notification immediately another time, its already 9 hours. I think i lost 3.1 usdπŸ˜₯. After that i tried 0.25 USD but it has been successful immediately. But what happens for 3.2 USD I can't understand πŸ˜₯πŸ˜₯

$ 0.01
2 years ago

You sent your BCH to different addresses.

$0.25 to this one:

bitcoincash:qrhwvryt7wfejq7jp9ck5r37nf2ez7pxc5x32fqva4

This is your transaction https://explorer.bitcoin.com/bch/tx/2c780761446a835691c55df55e27b6a277acf284bf9fc0f2ec22770f5de46e51

$3.1 to this one:

bitcoincash:qpe0nkyzvze9wlckdzd3t5d3seysxve75q6clm32qs

Your transaction https://explorer.bitcoin.com/bch/tx/17e7fd45d46cbea21522ed572724e088f4504346362cf226fdb372ecba02eaef

You probably sent it to the wrong address.

$ 0.00
2 years ago

I can't accept it, how its possible, i can't create any wallet address. Anyways after 1 week later i got payment, and its a good amount for me but i have lost itπŸ˜₯ Thanks for the information and upvote sir

$ 0.00
2 years ago

You do not need to have created the address. You may have copied a wrong address and pasted it in for sending. What kind of address is this?

bitcoincash:qpe0nkyzvze9wlckdzd3t5d3seysxve75q6clm32qs

Maybe this is your address in another wallet? I have many different addresses in different wallets.

$ 0.00
2 years ago

I have received my 3.1 USD just right now. Thanks for you help sir❀

$ 0.00
2 years ago

Thank you so much sir @telesfor sir to clear us this matter... Previous I'm not clear about that now i can understand the matter hope you’ll public more informative article like this.... Thanks for this information sir......

$ 0.00
2 years ago

What is the difference between Bitcoin Cash and fiat currency like USD or PHP I didn't know either But after reading your article, it has become clear to me

$ 0.00
2 years ago

Yes, many people don’t how to use read.cash. And can’t understand what is Bitcoin

$ 0.00
2 years ago

The article is very instructive. @telesfor

$ 0.00
2 years ago

I read the article carefully. Thank you so much sir for helping with so much unknown information. Hope you will always help us with many more important information.

$ 0.00
2 years ago

Sir I read the article carefully but from this article I came to know about it better and one of my request to you is that I want a sponsor from you, if you give, I will be very happy.😊😊

$ 0.00
2 years ago

Wow! II didn't know about this before.Thank you very much for your feedback on this topic.

$ 0.00
2 years ago

I know somebody who does not understands the difference between USB and MP3.

$ 0.00
2 years ago

This is @PASTOR001 ones again with another wonderful Calvary greetings for your kindguesture, my God will also upvote your carrier thanks

$ 0.00
2 years ago

I also think BCH has that potential.. BUT right now it's value is very less compared to BTC.. and a few days back it's value got dropped by 25% .... so I think it's not a competition till now.. It will take time and depend on many other sensitive issues...

By the way I needed a help from you.. my account has been dead for a few days.. and the response to my mail to the RC authority was that I need an upvote from a power user, in this way things can be fixed.. Since u are one, can u help me out plz?? Thanks in advance....❀❀

$ 0.00
2 years ago

All cryptos fall and rise strongly, this is nothing new. You have to think long term. The fact that BTC is overpriced only shows that BCH has much more growth potential. The dominance of BTC is falling and falling. Read here:

https://read.cash/@jonald_fyookball/keep-an-eye-on-the-btc-dominance-chart-03495f7e

What do you mean saying "account is dead"?

$ 0.00
2 years ago

I really learned in your shared information know I really know. As you said that I should remember.

To understand the difference, one must first properly understand what a fiat currency is. The first misunderstanding starts with the fact that many think that currencies such as USD, EUR or PHP are backed by gold, oil or other goods. But that's not true. The fiat currencies are not backed by anything. It used to be that way, but it was lifted in 1976 at the latest.

Actually I really confused about that But the unclear becomes clear in me in a sinple why. Actually I am new here and begginner knowledge about Bitcoin but I really learned in you about Bitcoin.

Bitcoin Cash is not created by the central bank or governments, but by miners. And best of all, anyone can become a miner. Everyone can create their own Bitcoin Cash. In the past you could do it with your own computer. Today you have to join a miner's pool.

I hope I learn a lot things in you. keep on posting and I will support you because you gives an interesting articles. God bless you.

$ 0.00
2 years ago

Amazing

$ 0.00
2 years ago

So having value behind the notes was invalidated ;-; i thought there was still an equivalent physical item that represented those notes. So it's true, i guess. Every person will be born with a debt to pay. I can understand better why people go on a frenzy for cryptocurrencies

$ 0.00
2 years ago

i thought there was still an equivalent physical item that represented those notes.

Most people think so, but that is not true.

$ 0.00
2 years ago

They should be teaching things ke these in economy classes somehow. It makes it unfair to newer generations to be born indebted by such a large amount

$ 0.00
2 years ago

Your article is interesting for reading and informative.Actualy I dont know a lot about cryptocurrencies.I have to learn more about this.I know only this much as I need to,so I can invest or withdrawal.

$ 0.00
2 years ago

I don't really understand the differences between the currency, but I really want to say a very big thank you for the upvote you gave to me @PASTOR001 God bless you

$ 0.00
2 years ago

I was good artical. After reading the article I can understand everything 😊

$ 0.00
2 years ago

Friend, I would like to be able to do BCH and Readcash induction workshops, in my city, in my community, in my area. How could i do? Do I need authorization from someone?

$ 0.00
2 years ago

Thank you for giving information between different crypto

$ 0.00
2 years ago

Please read my article carefully. At least read the title.

$ 0.00
2 years ago

Very informative sir, thank you for sharing your knowledge.

$ 0.00
2 years ago

Hmm im everyday learne something about crypto also lot of thing hear here in read.

$ 0.00
2 years ago

I learned a lot from this article, I don't have any knowledge about this cryto stuffs but yours posts giving me knowledge about it. Thank you so much 😊

$ 0.00
2 years ago

Your explanation about the fiat currency is quite intrusive and revealing. What is there now is that the whole world stand indebted to one another, America to Europe, China to America, Africa to China. This is a circle of debt that have no end. This is the mess the greed of men has put all of us into. You can imagine a nation in Africa where the overhead debt is perked at $15000 to China. What that means is that each citizen of such nation is indebted to China.

$ 0.00
2 years ago

Great article for newbies!

$ 0.00
2 years ago

Many thanks for the appreciation and the tip.

$ 0.00
2 years ago

Informative . Thanks for sharing.

$ 0.00
2 years ago

Thank you sir, in this post of yours I have understood the path. I have also taken the idea. I have not known much about this for so many days .

$ 0.00
2 years ago

Wow! thank you for this one really helps me to understand more and know the difference

$ 0.00
2 years ago

Woow .. love you Bitcoin

$ 0.00
2 years ago

Thank you sir for explaining the difference between fiat and bch. 😊

$ 0.00
2 years ago

Thanks sir for sharing this information.

$ 0.00
2 years ago

Thanks for this article of yours n for sharing it here, fiat currency's a piece of paper or a bank note n BCH, BTC, XRP's a digital money n maybe soon, it will be widely used n all will be on a cashless payments, transactions, etc., this article's so good n informative n gained another knowledge about BCH because of this one, thank u again for this, sir

$ 0.00
2 years ago

Thank you for describing this important thing so beautifully. I had no idea about BCH honestly before using RC. Now i am learning a lot from different different articles . This one is easier to perceive.

$ 0.00
2 years ago

Sir I have a few questions coming to my mind from ignorance . These blocks 50/25/12.5/6.25, these were created as a software, so it can be changed also to change the block size again? The person or group of people with that ability can then control BCH block size and BCH value? The size of each block is decreasing then what about the number of blocks, is it also decreasing?

$ 0.00
2 years ago

The blocks are created with software. All miners use the software. If someone changes the software and creates larger blocks again, his block is considered invalid on the network and discarded. In order to make such changes, more than 50% of the miners (more precisely PoW) have to agree with it and use changed software. But it will probably not come to that.

You can see it right now in the IFP drama. ABC has changed its software so that 8% of the 6.25 BCH should go to ABC's address. She wants to use the software on November 15th. But the majority of miners don't want it.

https://cash.coin.dance/blocks

ABC now has two options. Either they do without it or they create a new coin.

The number of blocks is also permanently programmed in the software. There are an average of 6 blocks an hour.

$ 0.00
2 years ago

If ABC has changed the software on her own then only the miners can stop it, no one else? Can she take such an arbitrary decision on her own?

$ 0.00
2 years ago

The miners create the coins. They decide which software they use. ABC tried it, but it won't work because the majority of miners and developers are against it.

Here you can read ABC position: https://read.cash/@Bitcoin_ABC/ifp-questions-and-answers-08522a53

https://read.cash/@Bitcoin_ABC

Here the others

https://read.cash/@asicseer/joint-statement-from-bch-miners-regarding-bitcoin-abc-and-the-november-2020-bch-upgrade-2cbdc38d

Here a good article by Jonald Fyookball

https://read.cash/@jonald_fyookball/amaurys-ifp-is-incompatible-with-bitcoin-cash-cadaec1a

$ 0.00
2 years ago

That is good news then.

$ 0.00
2 years ago

Saving money on the bank is like you are letting other people used your money in a form of loan like you said, sir. Some people especially us Filipino converting BCH to fiat because of the volatility of its value, especially if the value decreased. Is there any way not to worry if the value drops? Or can we still cope with the loss, if it drops big time sir?

$ 0.00
2 years ago

The price can fall. The prices are very much determined by speculation at the moment. If you need the money now, it is better to exchange and spend it. In the long run, I believe the price of BCH will go up. But keeping all savings in cryptocurrencies is unreasonable. I keep around 10% and not just in BCH.

$ 0.00
2 years ago

Oh, I see so it is really advisable to diversify portfolio not just putting all the egg in one basket. Thank you sir for your answer, I was enlightened.

$ 0.00
2 years ago

In layman's term, fiat currency is a piece of paper, and crypto currency like BCH and BTC is a digital money. For my own opinion, I think people should now adopt to the digitalized world, and say goodbye to the old currencies. For my own experience, my money in the bank does not grow, even if they say that it gets to earn interests. But if I actually transfer it to the digital coins, it has a chance to multiply. Though you really have to think about what coin you are going to transfer your money. But anyway, thank you for this article. I hope most of the users who still don't have any idea about the differences of these currencies will be able to read it.

$ 0.00
2 years ago

Thanks for sharing this very useful information Sir, I really dont know what is Fiat money before but you've explained it well ., now I understand more.

$ 0.00
2 years ago

Thank you very much sir. To give such a beautiful description. In fact, like many, I was in confusion. now most of my confusion are gone.. Also i have some wrong idea about fiat money and also about bch. But After reading your description. Always you try to explain any think in vry simple and clear language. I really appreciate your great work. Again say. Thank you so much sir.

$ 0.00
2 years ago

Thank you for upvoting

$ 0.00
2 years ago

I really like your your article. I think you you deserve more. But my bad luck last few day's i have been sick. So i cannot work here more. I getting low points so i got low $ everyday. Your article deserves more tips.

$ 0.00
2 years ago

For me, your tip is an expression of your appreciation. I don't write for money, I write to explain it to you. I hope you really read it and understood it.

$ 0.00
2 years ago

Yes sir. I read it. And your article help me to get right idea. I have some wrong idea before. Thank you so much sir. 😍

$ 0.00
2 years ago

Thanks Sir for explaining the difference between the two currency. Cryptocurrency like Bitcoin Cash BCH is more secure than currency in the form of banknotes issued by government. As long as you have the Seed Phrase of your crypto wallet its safe and government can't infiltrate your crypto assets. But for a young people like me that just turn 18 this year has still have many questions about this complicated topic. Again thanks.

$ 0.00
2 years ago

Wow. That is a great explanation sir. Before i read this article, i read first your conversation with @Great_influence. It was indeed a long convo between the two of you. But i learned a lot from your conversations. And now here, you totally explained it well.. thank you so much. Btw, i also converted my btc to bch. I am no longer using it. 😁

$ 0.00
2 years ago

This article explains the concepts of Fiat and crypto currency in very simple and clear language. Truly to secure one's future and assets crypto is the way to go. Thanks a lot for this write up.

$ 0.00
User's avatar M3i
2 years ago

After reading your article I has just gain a bit of knowledge about What is the difference between Bitcoin Cash and fiat currency like USD or PHP. I'm new here and now I'm know a bit about crypto-currency.

$ 0.00
2 years ago

Thanks for the effort to publish an article that is very easy to comprehend. Even those people (like me) who have a limited knowledge about crypto and bch can understand what you really want to say.

$ 0.00
2 years ago

Oh now I deeply understand about FIAT .About 2 weeks ago I published an article also about FIAT and in my some information are slightly wrong hehe. But thanks for this I now understand it well.

$ 0.00
2 years ago

Yep this is why we need to ditch this as soon as possible and adopt other money like BCH for a brighter future.

$ 0.00
2 years ago

Now i understand the difference and how does these currency works on.Thanks for your describe which help us a lot.

$ 0.00
2 years ago

This is a really and nice explanation about differences between Fiat and BCH I hope the "same" user and others understand a lot more about!

$ 0.00
2 years ago

Thank you sir. To write so beautifully about the difference between Bitcoin and Dollar. In the end the matter was cleared. Sir, can I translate and post it in Bengali so that it more understandable to all Bangladeshi people?

$ 0.00
2 years ago

Feel free to translate it

$ 0.00
2 years ago