For many newcomers, cryptocurrencies can be confusing at the best of times. Not only are they extremely complex, but there are also so many of them to choose from.
Bitcoin itself is no stranger to this. There are multiple iterations of Bitcoin, from the original – BTC – to Bitcoin Gold and Bitcoin Private. The biggest competitor to Bitcoin though is Bitcoin Cash (BCH). BCH is a hard fork of Bitcoin that aims to solve the issue of scaling through the use of bigger blocks.
The creation of Bitcoin Cash
Bitcoin Cash arose due to a large scaling debate that happened within the Bitcoin community. Debates began to arise when the Bitcoin mempool began to fill up due to the amount of transactions taking place on the network. This caused Bitcoin to become slower and more expensive to send than it had been in the past.
There were two options depending on your viewpoint. The first was to scale by increasing the block size of Bitcoin, and the second was to scale via a second-layer solution such as the Lightning Network. When neither side could come to a compromise, a fork took place and led to the creation of what became known as Bitcoin Cash.
Bitcoin Cash was backed by evangelist Roger Ver and mining giant Jihan Wu along with many other industry leaders and “experts”. They disagreed with the idea of implementing SegWit onto Bitcoin and wanted to see Bitcoin scale to 8MB blocks.
How do bigger blocks work?
Bigger blocks allow for more transactions to take place. However, this comes with the downside of creating a larger blockchain. Those who believe in BTC argue that bigger blocks will eventually lead to mining centralisation.
BCH supporters argue that through Moore’s Law technology will eventually catch up, allowing for bigger blocks to be possible without these centralisation issues.
Bigger blocks are believed to be necessary due to the fees associated with Bitcoin. When the network became extremely popular in the bull run of 2017, fees and transaction times began to rise considerably. This made it clear that Bitcoin needed to scale.
Bitcoin Cash believes that it has solved these problems through bigger blocks, which it argues allows for much lower fees.
It is impossible to discuss Bitcoin Cash without mentioning evangelist Roger Ver. Ver was one of the first people to promote Bitcoin to the world. He was an early investor in the cryptocurrency and many major cryptocurrency companies today were helped by his funding. As the owner of the bitcoin.com domain, he holds a powerful position.
Ver argues that the direction that BTC has taken has limited the cryptocurrency and allowed other altcoins to rise in prominence. He argues that Bitcoin Cash is the true Bitcoin as it is a form of peer-to-peer electronic cash, as stated in the white paper.
This has not been without controversy, and resulted in much antagonism directed towards Ver. Some have argued that Ver has misled the public in his promotion of Bitcoin Cash as the real Bitcoin – an accusation he vehemently denies.
A fork of Bitcoin Cash
BCH went through its own drama in late 2018. After the split from BTC, BCH was led by Roger Ver, Jihan Wu, and development teams including Bitcoin Unlimited and Bitcoin ABC. They were also supported by Craig Wright of nChain and his partner Calvin Ayre.
However, their relationship soured, and another fork took place splitting Bitcoin Cash into BCH and Bitcoin Satoshi’s Vision (BSV).
Many members of the Bitcoin Cash community are on the r/btc subreddit. The r/btc subreddit is another split from the original r/bitcoin subreddit. The drama began when users argued that the r/bitcoin subreddit was too heavily moderated, therefore limiting free speech.
This led to the creation of r/btc, and this is where you can find the most up-to-date news on Bitcoin Cash and debates surrounding the cryptocurrency. If you want the latest news and to join the community, this is the place to start.
There are many fervent supporters of Bitcoin Cash who believe that on-chain scaling is the main solution to the current scaling issues. Although it has yet to make a dent in overtaking the original Bitcoin chain, their beliefs have not diminished. This is the main difference between Bitcoin Cash and Bitcoin – the debate over scaling on-chain or via a second layer.
Arguments over the split still rage on to this day, with both sides not conceding any ground. Whilst many deride Bitcoin Cash, there is an argument to be made that the testing of an on-chain scaling solution is a good experiment for the whole of cryptocurrency.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.