Did you know that Bitcoin Cash originates from Bitcoin itself? That’s right – the nodes/nodes of Bitcoin Cash were part of blockchain of Bitcoin. The Bitcoin Cash is a fork of Bitcoin.
But which of the two should you choose to invest? What is the difference between Bitcoin and Bitcoin Cash? What is a fork? There are so many questions and I am here to answer all of them!
At the end of this guide, you will know the difference between two different cryptomonads – Bitcoin Cash vs. Bitcoin.
You will learn more about its history, value and its potential for the future. After that, you must decide on which you prefer to invest or if you want to invest in both.
First, let’s take a look at Bitcoin and its history. So, I’ll explain what a fork is. After that, we’ll see the story behind Bitcoin Cash and its features.
What is Bitcoin?
The Bitcoin was the first cryptocurrency of all time and for many years, was not widely known. It’s just like any other real currency. You can use it to buy, sell, and market goods, services, investments, and more.
The blockchain technology that is made prevents it from being counterfeit. This also means that it is not owned by anyone nor is it issued or controlled by a single group or entity.
For example, the US dollar is issued by the US government and is controlled by banks. In this scenario, the central controller is the government and the banks. When you transfer dollars to a friend, you are relying on the bank to authorize and process the transaction.
The Bitcoin, on the other hand, is not issued or controlled by any central authority. The transactions in the blockchain are verified by the computers themselves that execute the blockchain, and these computers can be owned by anyone – the blockchain is decentralized.
In blockchain, transactions are stored and sent in blocks. Computers scan the entire block of transactions at once solving a complicated math problem. When the problem is resolved, transactions on the block are checked and new Bitcoin is created – which is given to the computer that solved the problem as a premium. This process is called mining!
The total number of Bitcoins in circulation is limited to 21 million. Even though there are already more than 16 million Bitcoins, it will be a long time before the Bitcoins count reaches 21 million! This is because every 4 years, the amount of Bitcoins created per block is halved.
As more people try to get their hands on some Bitcoin and the rate of creation decreases, the common belief is that the value will increase. That’s why so many people are crazy about Bitcoin now!
Today, Bitcoin is the most valuable crypto-currency in the market. While other currencies are trying to outperform Bitcoin and reduce its dominance over the digital currency industry, few are coming close. However, Bitcoin Cash may be an exception to this because of the difference between Bitcoin and Bitcoin Cash!
As Bitcoin Cash is a fork of Bitcoin, I will explain what a fork is before explaining what Bitcoin Cash really is. Here we go?
What is Bitcoin Cash?
Like Bitcoin, Bitcoin Cash is a cryptomonad with its own blockchain. It functions as a digital currency and the new BCH (Bitcoin Cash) is created through the mining of Bitcoin Cash. It was created at the end of 2016, is therefore much younger than the original Bitcoin.
The Bitcoin fork to create Bitcoin Cash happened because the developers of the original Bitcoin wanted to make some important changes in Bitcoin.
However, the developers of the Bitcoin community could not agree on some of the changes they wanted to make. So a small group of these developers bifurcated Bitcoin to create a new version of the same code with some modifications.
The changes that make all the difference between Bitcoin and Bitcoin Cash are these:
- The Bitcoin Cash has lower transfer rates (about $ 0.20 per transaction), thus making transactions with BCH save more money than the BTC. A BTC transaction can cost about $ 1 per transaction, although this amount is decreasing considerably with the implementation of Lightning Network technology.
- The BCH has faster transfer times. Thus, you do not have to wait for the 10 minutes required to verify a Bitcoin transaction.
- The BCH can handle more transactions per second. This means that more people can use BCH at the same time than with BTC.
- The Bitcoin is more scalable than the Bitcoin Cash. The changes made to Bitcoin (which are not reflected in the BCH) offer advantages to Bitcoin over Bitcoin Cash in terms of scalability, with the increase in the day-to-day user network.
All these changes are due to the fact that a Bitcoin Cash block (in the blockchain) is eight times larger than a Bitcoin block. This makes BCH faster and cheaper than Bitcoin. However, Bitcoin may be more scalable than BCH.
Difference between Bitcoin and Bitcoin Cash – the price war
As mentioned earlier, crypto derivatives such as Bitcoin or Bitcoin Cash derive their value from how much they are adopted, used and popularized. We can analyze them in terms of ROI (return on investment) and value growth.
They are both worthy of value, and while Bitcoin has been the highest-value holder yet, Bitcoin Cash is gaining users as well and gaining momentum.
Bitcoin Cash is still under one year old. So, it is still in the process of capturing and conquering its own place in the crypto-coins market.
Many people speculate that Bitcoin Cash can absorb much of Bitcoin’s market share, making it the dominant new cryptomonad in the industry.
However, the truth is that, to date, the market has shown a different idea. Not only has Bitcoin retained most of the support from developers and enthusiasts, but it has also been reflected in its price and market value.
Today, many months after its creation, Bitcoin Cash has managed to gain a solid place in the top 5 of the cryptomonads, but Bitcoin comfortably holds its place at the top of the crypto-coins market.
Conclusion: the difference between Bitcoin and Bitcoin Cash
In the course of this article, we explored some of the main differences between Bitcoin ( BTC ) and its main fork – Bitcoin Cash (BCH). We also discussed some of its history and the reasons why Bitcoin Cash was created.
Bitcoin Cash, after its inception, has emerged as a potential solution to Bitcoin’s scalability problems. But the truth is that with the launch of the SegWit and Lightning Network technologies, the original Bitcoin may be able to correct this same problem, making the existence of the BCH totally redundant.
The implementation of these technologies is already occurring and only time will tell if they will effectively solve the problems that Bitcoin has had to face in recent months in terms of scalability.
Meanwhile, continue to follow our guides on bitcoin and other crypto-coins to know where, when, and in which crypto-coins to invest safely. Welcome to the world of crypto-coins!