- 1 What is Bitcoin Cash?
- 2 How does Bitcoin Cash work?
- 3 How is Bitcoin Cash different from Bitcoin (BTC)? Is Bitcoin Cash better than Bitcoin?
- 4 Will Bitcoin Cash replace Bitcoin (BTC)?
- 5 How to buy Bitcoin Cash? Which exchanges sell Bitcoin Cash?
- 6 Can Bitcoin Cash be mined? How to Mine Bitcoin Cash?
- 7 Can Bitcoin Cash be stored in a Bitcoin Wallet?
- 8 Where can you store Bitcoin Cash? Which wallets support Bitcoin Cash?
- 9 Where is Bitcoin Cash Accepted?
- 10 Who are the people behind Bitcoin Cash? Who created Bitcoin Cash?
What is Bitcoin Cash?
Bitcoin Cash is a peer-to-peer digital currency that resulted from a hard fork on the Bitcoin blockchain on August 1, 2017. A fork refers to a change made on the original software of a digital currency so as to create two separate currencies that share a common history.
The bitcoin hard fork that resulted in the creation of bitcoin cash was prompted by a disagreement in the team behind the currency. The bitcoin blockchain was designed with the capacity of 1MB on every block. This allows it to process only 4.4 transactions per second.
While this was fine in the beginning, the rising popularity of the currency with time led to scaling issues. The number of transactions on the network became higher than the blockchain’s capacity to process them.
One group on the team recommended increasing the block size to 2MB to accommodate the upsurge. But another group was opposed to the idea. These two teams eventually decided to part ways using a network hard fork, leading to the rise of a new blockchain known as Bitcoin Cash.
How does Bitcoin Cash work?
Btcoin cash operates almost exactly like its parent currency because they share the same basic technical framework. But it has some unique features that define its operations.
First, it offers an increased block size to minimize congestion on the network and allow for scalability.
In addition, it has incorporated some security provisions that protect it from common post-fork attacks. One of these is the replay attack which involves taking a transaction from one network and replaying it on a similar chain. Another security risk would be the wipe out attack whereby transactions carried out on one chain can be deleted through the other one.
Bitcoin Cash has a redefined sighash algorithm that prevents both types of attacks by altering the way transactions are signed on the network so as to make the networks distinct.
How is Bitcoin Cash different from Bitcoin (BTC)? Is Bitcoin Cash better than Bitcoin?
One of the foremost differences between these two digital currencies is the fact that Bitcoin has a block capacity of 1MB while Bitcoin Cash has 8MB. This makes it possible for miners on the latter network to process transactions faster than on the former.
Another difference is that the Bitcoin Cash team believes that scaling the network should be done on-chain while the legacy community believes that off-chain scaling is the way to go.
The latter team therefore embraced the development of a solution known as Lighting Network. This entails the use of node hubs for processing transactions. But the Bitcoin Cash team feels that this is a deviation from the original centralized model that Satoshi Nakamoto proposed in the Bitcoin whitepaper.
Both networks have their merits but the Bitcoin Cash community believes that its approach is closer to Satoshi’s vision. The legacy team on the other hand says that the original vision was flawed as it does not take into consideration the latest developments.
Will Bitcoin Cash replace Bitcoin (BTC)?
The Bitcoin Cash model offers some remarkable improvements over the original blockchain. It offers much lower transaction times and fees. Its model also offers more potential for scaling compared to its predecessor.
Network congestion, high processing fees and general scaling issues are yet to be addressed on the legacy network. This has led to a lot of discontent in the Bitcoin community with some predicting that Bitcoin Cash will soon take the lead in the crypto market.
However, Bitcoin has the distinct advantage of being an early riser as it was the first digital currency created. This has given it a huge market advantage over all other virtual currencies including Bitcoin Cash. It is in fact viewed as the “digital dollar” because it is most widely used to purchase other crypto coins on exchange platforms.
While we cannot totally rule out the possibility of Bitcoin Cash replacing Bitcoin, it would take a lot for that to happen.
How to buy Bitcoin Cash? Which exchanges sell Bitcoin Cash?
There are numerous exchanges where you can purchase Bitcoin Cash (BCH). On a majority of them, for instance Binance, Bittrex, Bitfinex, Poloniex, Coinbase, GDAX, Huobi and Kraken, you need to have Bitcoin (BTC) in order to make the purchase. But if you wish to use fiat currency, you may opt to buy from CEX.io which offers that provision.
All you need to do is to create an account on any one of these exchange sites and buy BTC. The next step is to use a crypto-to-crypto exchange platform like Changelly or ShapeShift to convert your BTC to BCH.
Another alternative is to use the LocalBitcoinCash platform to make your purchase. This site contains a list of buyers and sellers of the currency.
Can Bitcoin Cash be mined? How to Mine Bitcoin Cash?
Just like its predecessor, BCH can also be mined. Mining BCH also uses the Proof-of-Work algorithm and requires SHA-256 equipment just like the ones used for BTC. You might choose to buy the equipment yourself or join a physical or cloud mining pool to start mining BCH.
Even though the total market supply, mining reward system and a number of other mining features are similar on both networks, it incorporates a slightly different protocol to make mining easier.
In order to improve the BCH hash rate, its developers set in place new rules concerning when to adjust mining difficulty. This rule works on the basis of time taken between blocks being mined. When it takes significantly longer than before, then the difficulty automatically decreases by 20% making it easier to mine.
This means that when there are few miners working on the network and the collective hashing power is this reduced, difficulty decreases and more miners come in.
Can Bitcoin Cash be stored in a Bitcoin Wallet?
Bitcoin Cash cannot be stored in a Bitcoin wallet. You need a separate wallet designed specifically for BCH in order to store it securely. Every person on the Bitcoin network who at the time of the fork had BTCs in their wallet got an equivalent amount of BCH.
However, not everyone was able to immediately access their stash of free BCH coins. This was because they needed to extract the coins from the existing BTC wallets and move them to one that supports BCH.
Digital wallet service providers were caught off-guard by the hard fork and not all of them were able to adjust immediately to the development. Some offered support while others chose not to because of the confusion that would arise and the technicalities involved.
Where can you store Bitcoin Cash? Which wallets support Bitcoin Cash?
At the moment, there are numerous wallets that support Bitcoin Cash. These range from hardware and paper wallets for the safety conscious users to mobile and online wallets for those who require easy access to their funds at all times.
Online and mobile wallets offer lots of convenience but come with the risk of losing your coins to malicious parties. Hardware wallets are more secure because they operate offline. They are also relatively accessible because they come in form of small devices that one can carry in their pocket.
Paper wallets are totally safe from hackers but have to be stored safely to avoid losing them or having them come into the wrong hands.
That said being said, Ledger Nano S and Trezor are great hardware wallets to use while Bitcoin Classic and BU Bitcoin Cash Client are popular desktop wallets. BTC.com offers both online and mobile storage options.
Where is Bitcoin Cash Accepted?
Bitcoin Cash is accepted in a number of online and offline stores. Even though this took a bit of time to implement, there is progress in adopting its use. This has mostly come as a result of the fact that many crypto exchange platforms now allow for BCH trading due to its rising popularity.
Some exchanges and vendors were initially hesitant adopt its use as no one knew whether or not the fork would be successful. But the BCH token got off to a good start and has managed to stay in the top five position on crypto charts.
This shows some level of investor confidence and contributes to its widespread popularity and use.
Some of the businesses that accept BCH include merchant service stores Coinify and Rocketr, gaming platform Keys4Coins and gambling sites Satoshi Dice, Betcoin and Satoshi Bones among others.
Who are the people behind Bitcoin Cash? Who created Bitcoin Cash?
The developer behind Bitcoin Cash is known as Amaury “Deadal Nix” Sechet. He was formerly a Facebook Engineer but decided to focus full time on Bitcoin early in 2017. He first revealed the protocol for the project in Arnhem, the Netherlands, at The Future of Bitcoin conference in December 2016.
There are a number of ardent Bitcoin Cash supporters who are also believed to have contributed to its creation. These include Roger Ver, Jihan Wu, Gavin Andresen and John MacAfee.
Jihan Wu owns Bitmain, the largest mining equipment manufacturer on the globe and only accepts BCH as payment for purchases.
John McAfee is the founder of McAfee antivirus software while Gavin Andresen is the man whom Satoshi selected to be bitcoin’s lead developer in 2011. Roger Ver is popularly known as Bitcoin Jesus and is the CEO of Bitcoin.com.