I want my website to accept donations. BTC or BCH?

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Many websites could well use a few more public contributions to keep going, but their donation pages often only list PayPal, Patreon or bank account details, and are missing cryptocurrency donation options.

If you have a site and are wanting to accept cryptocurrency, you may be wondering which is better to accept:

Bitcoin (BTC) or Bitcoin Cash (BCH) ?

Let me explain in a simple way: When someone sends either of these two cryptocurrencies, they have to pay a "network fee" to the respective currency network (BTC or BCH).

There are sites to compare these fees, you can see for example at

https://bitcoinfees.cash/

The network fee for BCH is quite reliably at below 1 US cent per transaction, unless the transaction is extremely unusual. That means, it costs someone almost no extra money to make a BCH donation to you.

Whereas the network fee for a BTC transaction is orders of magnitude higher, and amounts to at least a few cents, but has in the past climbed much higher - even to more than $10 just for one transaction!

The reason for this difference in fees is that BTC takes the approach of limiting the amount of transactional capacity, which can cause fees to increase sharply when the network is congested.

Whereas on BCH, the goal is to have enough capacity for transactions such that congestion should (almost) never occur, keeping the fees for users very low. That means more of the money ends up in your pocket as a receiver.

So which is better?

In my opinion, BCH is much better suited for donations, as people will be much happier to donate - even small amounts - if they do not lose much money to fees. You can see that in action on this site, where people regularly tip amounts of $0.05 or even less since the fees are still an order of magnitude less than that.

Of course, it may be best to accept donations in both - a BCH address and a BTC address.

What's the difference between a BCH address and a BTC address?

Bitcoin Cash BCH inherited the same key scheme from Bitcoin BTC, but it introduced a new format of displaying the addresses.

A BCH address is commonly shown in what is called "CashAddr" format, which looks like this:

bitcoincash:qptfelt5jlale5xjcvwuvjrwy9szrxun3clfznfr0q

whereas a BTC address commonly looks like this

18tyBMmRzfaZBDndq9rXmYvkJz1Tzqx3on

(sometimes starting with a 3 if it is an address for a multi-signature account)

Converting between formats

You can convert between "BTC" addresses that look like the above, and Bitcoin Cash addresses, using this converter tool or the built-in converter in the Electron Cash wallet.

If you use that tool on the addresses above, you will see that they are in fact equivalent!

This is because each CashAddr address maps to a corresponding legacy BTC address and vice versa. But this does not mean that a user can send BTC coins to a BCH account or vice versa! BCH coins can only move and stay on the BCH network, and BTC coins can only move and stay on the BTC network.

But the same address, like 18tyBMmRzfaZBDndq9rXmYvkJz1Tzqx3on, can exist on both networks, and hold a difference balance on each. You can check the balance by putting the address into a block explorer like https://blockchair.com which automatically displays results for various currency networks, including BCH, BTC and BSV. (BSV is another coin, descended from BCH, which has some overlap in valid addresses with BCH/BTC.)

When you are accepting Bitcoin Cash, e.g. by having a donation address on your website, you should always provide your sending counterpart with a CashAddr.
This will prevent misunderstandings.
Also, include the bitcoincash: prefix if the address is for Bitcoin Cash. That makes it quite unambiguous.

Unfortunately, some sites which accept Bitcoin Cash still display legacy addresses. When you see them, it's best to politely remind the site operator to update the displayed address to avoid any confusion.
Please point them at the converter tools I linked above!

If you have questions, leave them in the comments below and I'll answer them if I can :)

Lead image: Photo by Bayu on Unsplash


Some useful links:


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Comments

Hey there, For art and music (as I'm musician, mainly), it's clearly the way! :0) & I will work on it on this 2020 year. Selling tracks or Albums at very cheap price!! Thanks to share your opinion.

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1 week ago

Great article. Makes it seem a bit more complicated than it might need to seem, but, it is better than most or all others?.

Possible typo in this sentence: "But the same address, like 18tyBMmRzfaZBDndq9rXmYvkJz1Tzqx3on, can exist on both networks, and hold a difference balance on each. "

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2 weeks ago
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