What is Bitcoin Cash (BCH)?
Bitcoin Cash (BCH) is a cryptocurrency launched on August 1, 2017, after the hard fork from Bitcoin. It uses Bitcoin’s blockchain platform but has a number of more innovative features. Bitcoin Cash was launched with the purpose of overcoming the disadvantages of Bitcoin such as transaction speed, security and scalability.
At the time of the hard fork anyone holding Bitcoin will receive a Bitcoin Cash ratio of 1: 1. However, if you store Bitcoin, you must hold the private key. For an exchange wallet, the exchange must support a hard fork in order to receive BCH.
Bitcoin Cash has 3 superior features than Bitcoin:
- Firstly, Bitcoin Cash offers a larger block size of 8MB.
- Second, Bitcoin Cash provides replay protection and wipeout protection. The transaction signature is a bit different and the block fork must be larger than 1MB.
- Third, Bitcoin Cash provides a way to adjust proof-of-work difficulty faster than the 2016 block difficulty adjustment period found in Bitcoin.
Features of Bitcoin Cash
The Bitcoin Cash platform has some minor changes. However, these changes will be the stepping stone for a race against Bitcoin later.
- Increase the block size limit
- Providing replay protection and wipeout protection, this makes the Bitcoin and Bitcoin Cash chains completely independent in all aspects.
- Adjusting the Proof-Of-Work difficulty in Bitcoin Cash is faster than Bitcoin
- New transaction signature
The principle of operation of Bitcoin Cash
Bitcoin Cash provides 3 outstanding features to solve the Bitcoin problems encountered, namely:
- The block size of Bitcoin Cash is 8 MB
- Using the new method of adjusting the difficulty of the PoW algorithm
- Provide Replay Protection and Wipeout Protection for extra security
As a result, Bitcoin Cash has advantages over Bitcoin such as faster, more stable and more reliable transaction time. In addition, it also possesses the most powerful Blockchain technology today and extremely low transaction costs.
Bitcoin Cash application
Bitcoin Cash was created to bring back the essential qualities of the money inherent in the original Bitcoin software. Built on the Bitcoin model, Bitcoin Cash is a cryptocurrency:
Decentralization: The network is spread on many different computers around the world.
Peer-to-Peer: Person A can send Bitcoin Cash directly to Person B from anywhere in the world without an intermediary, such as a bank.
Secure: Bitcoin Cash uses strong encryption to prevent phishing, fraud and cyber attacks.
Open transactions: The history of all Bitcoin Cash transactions is logged into a public access blockchain that can be viewed and verified by anyone.
The average Bitcoin Cash cash transaction costs less and can confirm an average of 10 minutes as the payment of pending transactions is cleared with each new block. This means that Bitcoin Cash can be used at ease in the same way as cash.
Pros and cons
The larger block size with 8MB helps Bitcoin Cash solve the problem that Bitcoin encountered: speed and transaction fees. Bitcoin Cash can handle more transactions at a cheaper cost.
Bitcoin Cash provides a way to adjust the Proof-Of-Work difficulty faster than the 2016 block difficulty adjustment period found in Bitcoin.
Many people believe that the solution to expand into 8 MB of Bitcoin Cash is just a short time, because in the case of BCH becoming popular and increased transaction, 8 MB is also not enough. Then they will have to increase again and it is not a good way.
Bitcoin has a lot of miners, mining pools, and decentralization are huge, so the possibility of an individual attacking 51% of the Bitcoin network is impossible. Bitcoin Cash is the opposite, very focused. Currently, they have 3 main mining groups, together they can generate over 51% of the total BCH. This is a dangerous situation for the Bitcoin Cash network.
Bitcoin Cash is not as popular as Bitcoin before, but it has turned itself into an extremely powerful cryptocurrency. It is the fifth-largest cryptocurrency in the world by market capitalization, second only to the industry of Bitcoin, Ethereum and Ripple Stalwarts.
Bitcoin has a maximum limit of 1MB of data per block and as mentioned above, this has caused scalability issues. The community did not reach consensus on the expansion issue even after years of debate. Bitcoin Cash, meanwhile, follows Bitcoin’s original vision but has implemented a variable block size limit, defaulting at 8MB. Along with that, many outstanding features are faster, more stable and safer.
You can check BCH price here.