Within the cryptocurrency community, the words Bitcoin and Bitcoin Cash are used interchangeably. Despite popular belief, they are really very different. The procedures, usage, and purposes of these two coins couldn’t be more different from one another. Do you want to know the differences between the two? If so, this guide is the way to go about it.
A Technological Evolution: An Introduction to Bitcoin
Bitcoin is a digital money that runs on a distributed, peer-to-peer network. An anonymous individual or group operating under the alias Satoshi Nakamoto introduced Bitcoin in 2009 as a decentralized digital currency that may one day replace fiat money and central banks. The decentralized nature of Bitcoin makes it distinct from fiat currencies that are created by authorities or monetary organizations like banks.
The innovative application of blockchain technology is the driving force behind Bitcoin. Distributed ledger technology, or the blockchain, logs each payment and all other activities that takes place on an interconnected set of devices. Because it is not centralized, it is resistant to censorship, secure, and transparent.
Mining is the method of acquiring Bitcoin by ensuring that transactions are included to the blockchain by having powerful hardware solve complicated mathematical inquiries. On the other hand, people may use fiat money to purchase Bitcoin on different cryptocurrency exchanges.
The 21 million coin cap is one of the defining features of Bitcoin’s limited production. To deter inflation and reflect the unique qualities of scarce commodities like gold, this system is intentionally designed to be scarce.
The Evolution of Bitcoin Cash
After several members of the Bitcoin community voiced concerns about some aspects of the original Bitcoin, a new cryptocurrency called Bitcoin Cash (abbreviated BCH) was born. In 2017, a hard fork happened because Bitcoin’s development community and miners couldn’t agree on how to make the original cryptocurrency more scalable and faster for transactions.
The installation of segregated witness (SegWit), a mechanism that attempted to minimize the amount of data in each block, in Bitcoin was the main topic of disagreement.
Bitcoin Cash advocates thought this didn’t do enough to address the scalability issue, so they went in a different direction. In comparison to Bitcoin, whose block size is 1 MB, Bitcoin Cash’s 8 MB block size allows for quicker transaction processing. The goal of this change was to streamline and speed up Bitcoin transfers for regular use.
Bitcoin Vs Bitcoin Cash: Key Differences
While both Bitcoin (BTC) and Bitcoin Cash (BCH) have a shared history, their technological aspects and underlying philosophical aims have caused them to differ.
Bitcoin was the first cryptocurrency ever made, with the main block size set at 1 MB.
A large number of users and major institutions showed interest in Bitcoin because of its positioning as “digital gold” and a safe way to deposit wealth.
In contrast, a group of developers and miners who had become unhappy with Bitcoin’s direction spearheaded a hard split and Bitcoin Cash was born.
To solve scalability issues and accommodate more transactions, Bitcoin Cash chose to raise the block size from 8 MB to 32 MB in 2018. One can consider Bitcoin Cash as an upgraded yet different version of Bitcoin.
Despite Bitcoin’s continued dominance, a more niche audience has emerged around Bitcoin Cash, whose proponents are pushing for improvements in scalability that happen on the blockchain.
In conclusion, the idea behind Bitcoin has expanded to include two more digital currencies: Bitcoin Cash and Bitcoin. Bitcoin Cash has attracted a large user base in addition to Bitcoin, making it the top cryptocurrency by valuation and market cap. Though there have been regular disagreements between the supporters of Bitcoin and the ones that support Bitcoin Cash, there is no doubt in the fact that both these cryptocurrencies have a long way to go. Nevertheless, bitcoin is still the most popular and well-known cryptocurrency, but Bitcoin Cash has established itself as a viable option for those seeking a more specialized product.