What exactly is Bitcoin Cash/BCH and what is the big deal behind it?
The abbreviation for Bitcoin as you probably know, is BTC. The abbreviation for Bitcoin Cash is BCH.
So what is the difference between the two? Why does there need to be both? Is there a valid reason? Today I want to look over this question briefly and try to go over just a few of the basics with you.
The size of the bitcoin block has bothered a number of developers, miners, and others involved in the popular cryptocurrency. It seems that the limit of 1 megabyte as the block size means that only 7 transactions can be handled in one second. Because of the number of transactions increasing, this can cause the system to lag.
On August 1, 2017, the protocol was changed making the block size limit 8 megabytes. The result was that the new currency was not the same as the bitcoin core so it had to fork into two streams of currency.
The first bitcoin cash block was mined 6 hours after bitcoin’s block 478558 was mined. This was the last entry in the blockchain before mining the first bitcoin cash block. It held 6,985 transactions and was nearly 2 MB in size – 1.915 MB.
Holders as of block 478558 were suddenly owners of both versions of bitcoin. If you owned a bitcoin on that date, it split into two and for every bitcoin you had, you received bitcoin cash. After that, you had both currencies in your wallet. Bitcoin cash carries the same transaction history as bitcoin up to that point.
Bitcoin’s block 478558 had 331 transactions. Bitcoin’s next block 478559 had 472 transactions. During its first 3 months, bitcoin cash performed well, starting around $300 USD per coin with a couple of peaks of $700. In November it went over $1,000 and it seems to be holding steady at the new high. On August 1, bitcoin was $2,863 per coin. Since then it has risen steadily, passing the $8,000 mark in November.
There are endless news reports claiming that cryptocurrency is a foolish fad and that it cannot be taken seriously, it is a cover for criminal transactions, and it is a scam. In spite of these nay-sayers, usually from the traditional financial people who believe in banks and stocks and all those tried and true things that never fail. Okay, they do sometimes fail spectacularly but these are the institutions that the financial community has promoted for generations. The idea of decentralized currency is upsetting to traditional banks.
The original bitcoin is now being referred to in some circles as Bitcoin Classic and the offshoots like Bitcoin Cash are the new kids on the block. Bitcoin has the same protection, privacy, and potential as bitcoin had and continues to have. It’s the same but different and some feel that it has the software upgrade that bitcoin needed. It does perform transactions smoothly and quickly and it satisfies those who agreed with the developers and other wizards who believed that bitcoin would clog the system with its limited block size.
Miners dig for the hash power of bitcoin cash the same way as they do for bitcoin. In the beginning, it was slow going and miners were not too eager to keep digging. The process has become easier and mining the new currency is growing.
In the crypto world of finances, ethereum has been running second to bitcoin in the overall ranking of all cryptocurrencies. Bitcoin cash has moved into third place. In November 2017, Bitcoin had a market cap of $137,956,376,673 and a price of $8265.34. Its volume is $3,660,040,000 and there are 16,690,950 BTC in circulation. Right behind it is ethereum which has a market cap of $34,874,490,795. The ethereum price is $363.86. Its volume is $806,323,000 with 95,846,958 in circulation. Bitcoin Cash’s market cap is $19,957,278,125 and it is selling for $1187.05. Its volume is $810,345,000. There are 16,812,500 BCH in circulation.
Figures change frequently. To keep an eye on the future of bitcoin cash, users are advised to follow the prices at a site such as coinmarketcap.com or check out any of the exchanges. Time will tell what their future holds.