Bitcoin Cash (BCH) cryptocurrency was created as a result of a hard fork from Bitcoin (BTC) in August 2017. The main reason behind the creation of Bitcoin Cash was to address the scalability issues faced by Bitcoin at the time.
As the number of transactions on the Bitcoin network increased, it became clear that the network could not process transactions fast enough due to the 1MB size limit of its blocks. This led to increased transaction fees and slower transaction processing times.
The Bitcoin Cash community proposed increasing the block size limit to allow more transactions to be processed in a single block, aiming to make the network more scalable and keep transaction fees low. This proposal, however, was contentious within the Bitcoin community, leading to a split. The faction supporting the block size increase forked the Bitcoin blockchain, and Bitcoin Cash was born with an initial block size limit of 8MB, which has since been increased to 32 MB.
What’s the Difference Between Bitcoin and Bitcoin Cash?
1. Larger Block Size Limit: Bitcoin Cash has a larger block size limit, allowing it to process more transactions per block. This makes the network more scalable and lowers transaction fees, especially during peak times.
2. Different Consensus Rules: Bitcoin Cash shares its history with Bitcoin until the fork. However, it follows a different set of consensus rules, primarily related to block size and transaction processing.
3. Focus on Peer-to-Peer Transactions: Bitcoin Cash emphasizes its utility as a medium for daily transactions and payments, aiming to become a practical cryptocurrency for buying and selling goods and services.
4. Technical Innovations: Beyond the block size increase, Bitcoin Cash has implemented other technical improvements over the years, such as Schnorr signatures and CashFusion, to improve privacy and efficiency.
5. Market Position: While Bitcoin remains the most recognized and valued cryptocurrency, Bitcoin Cash has carved out its niche within the broader crypto market, appealing to users and merchants who prioritize fast and low-cost transactions.
