Bitcoin Cash was the first major Bitcoin code fork and airdrop.
As a result of the forked ledger, everyone holding Bitcoin on the BTC chain were credited with the equivalent amount of Bitcoin Cash, when its block chain launched.
When did the chain start?
The standalone blockchain for Bitcoin Cash started on the 1st August 2017. On this date, a group of miners moved to produce POW (proof of work) and blocks compatible with the protocol implementations for Bitcoin ABC, Bitcoin Unlimited and Bitcoin XT nodes. These three node protocols stayed in consensus with the new blocks but the majority of nodes (Under the Bitcoin core protocol) rejected the blocks, and mined from these miners.
Why did the majority of nodes reject the Bitcoin Cash blocks?
The Bitcoin Cash blocks had a larger block limit of 8mb (Current Bitcoin nodes only accepted blocks under 1mb as part of their consensus rules). All other consensus rules on the nodes remained the same. Examples include the rate of blocks (10 mins) or the total supply of coins (21 million).
The start of the new blockchain?
At the point the chain split in two, it was the first time you could send transactions of funds that you held in Bitcoin to either the original BTC blockchain and also the new BCH blockchain. People assumed they got ‘free’ money with their BCH airdrop.
Is Bitcoin Cash is different to Bitcoin?
Bitcoin Cash today is a 100% independent cryptocurrency; its price is not dependant on that of the original Bitcoin. However, Bitcoin (BTC) is still the most dominant cryptocurrency (with over 50% dominance in market share today).
What happened at the time of the fork?
At the exact time of the hard fork (and split in blockchains) we saw battles break out in two specific places: on exchanges for people selling their BTC for BCH (or the other way around), and also in the hashing power to mine blocks for each fork.
Exchange Battle…
Many popular exchanges (Including Bitfinex and Kraken) announced before the fork that they would start active trading markets for the BTC vs BCH trading pairs. Trading started at close to 7 BCH for 1 BTC but the price quickly collapsed down to around half that at 14 BCH for each BTC.
Hash Rate Battle…
Both the Bitcoin and Bitcoin Cash blockchains required the same hashing algorithm for their miners (Sha 256). A lot of the mining hash power does not care what blockchain they are providing POW (Proof of work) for they just care about ROI. So this means they are dedicating electricity costs to try and earn some of the block reward of 12.5 new BTC or BCH issued every 10 mins.
ROI for miners…
If the price between BTC and BCH are continuously fluctuating on the exchanges, this significantly impacts any ROI calculation used. A website was launched at the time of the fork called fork.lol. On this site, they worked out an index called DARI that represented normalised miner income for work done.
The first fork…
Bitcoin Cash will always be known as the first major Bitcoin fork and airdrop. In the months following the fork we had other airdrops launch like Bitcoin Gold, Bitcoin Diamond, Bitcoin Private and Bitcoin Interest all launch. btcdiv.com is a website that tracks Bitcoin forks, so far they list 26 major BTC airdropped forks.
Who holds the most Bitcoin Cash..
As part of the disclosures from Bitmain’s upcoming IPO, it was revealed that Bitmain held one million BCH. That’s over 5% of all coins in circulation.
Only one real Bitcoin…
According to Bitcoin.com (CEO: Roger Ver), they claim that BCH is the real bitcoin. They claim that the current code implementation of BCH aligns closer to that of Satoshi’s original white paper (published 10 years ago). This viewpoint is also held by Bitmain, who are rumoured to be behind the majority of the hashing power behind the bitcoin cash network.
Who was is Roger Ver…
Ver is a prominent investor and an early crypto adopter. He is also a CEO of Bitcoin.com. He has invested in various emerging Bitcoin start-ups, including Ripple, Z Cash, Blockchain.com, Bitpay, Purse.io and Kraken, he is also known as Bitcoin Jesus.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.