What is Bitcoin Cash (BCH) | Coinsbee
The intention of creating Bitcoin Cash (BCH) goes a little deeper than only creating another digital currency to enter the market. It’s undoubtedly one of the fiercest decentralization tests of bitcoin. It was created back in 2017 by hard forking off of the original Bitcoin, and that’s why it’s basically a Bitcoin derivative. It became a separate altcoin after the hard fork as some cryptocurrency enthusiasts want to increase the block size.
The current block size of Bitcoin Cash is 32 MB, and at the time of its creation, the network was processing 1000-1500 transactions a block.
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What Does Hard Fork Mean?
People who are interested in cryptocurrency get very confused when they get to know that there is not only one Bitcoin type such as Bitcoin Diamond, Bitcoin Gold, Bitcoin Cash, etcetera. All of these are actually original Bitcoin’s forks which means that all of these are alternative versions or different variations of the original cryptocurrency. Generally, there are a couple of fork types which are soft and hard fork, respectively.
The soft forks are capable of working with both original and alternative versions of the original cryptocurrency. So, a new user can get started with the soft fork version without worrying too much. On the other hand, the hard forks are a little more different, and they can’t work properly with the original version. It means that a new user will need to update his/her software to deal with the hard fork version; otherwise, s/he will have to stick to the original one. In simple words, Bitcoin is somewhat similar to the original Bitcoin, but it’s not identical. The hard fork versions that Bitcoin have been the result of the upgrades suggested to the existing protocol, but not all the users agreed to them. So, the hard fork versions were created for the users who needed to use those suggested updates, and these versions have become alternative coins as well.
Why was Bitcoin Cash Created?
Now that you understand what Bitcoin Cash actually, it’s time to understand why it was created. For that matter, we need to travel back in time a few years to look at one of the most controversial points about the code of Bitcoin. It was none other than the block size of the Bitcoin and its scalability issues. The transactions of bitcoin don’t easily get confirmed, and they need to be included as a transaction block part in the Bitcoin blockchain.
A new transaction block is added to the ledger after every 10 minutes on average, which requires space. Moreover, the maximum block capacity on Bitcoin is only 1 MB which can hold about 2700 transactions. It means that 2700 transactions take place after every 10 minutes, which means that only 4.6 transactions take place per second, which is very less. There are portals that can process up to 1700 transactions per second, and when more and more people want to send Bitcoin, the transactions get stuck. If any user wants to bypass the queue, then s/he will need to pay an additional fee for that, and it’s not something that people want. Because of this scalability issue, two groups were created, and one of them joined Bitcoin Cash.
Bitcoin Vs. Bitcoin Cash
Since Bitcoin Cash is the fork of the original Bitcoin, it’s ranked as one of the most valuable cryptocurrencies in the whole world. It’s most similar to Bitcoin, but there are some differences, as we mentioned, such as biller block size and fewer scalability issues. At first, the block size was 8 Mb, but in 2018 it was increased to 32 MB. Moreover, unlike Bitcoin, it also doesn’t support Lightning Network or SegWit, but it also offers quicker mining time.
After the creation of Bitcoin Cash, two different groups within the community of this cryptocurrency emerged (which are ABC and Bitcoin SV), and another fork took place. Bitcoin SV increased the block size to 128 MB but still, Bitcoin Cash with ABC group is more popular and considered as true Bitcoin Cash.
How to Get Bitcoin Cash?
Just like most of the cryptocurrencies, there are two different methods to get Bitcoin Cash which are as followed:
- Mining Bitcoin Cash
- Purchasing Bitcoin Cash
How to Mine Bitcoin Cash (BCH)?
Before getting into the mining process, it’s important to get yourself the right hardware to have an effective and efficient mining experience. These days your mining can only be profitable if you have an ASIC miner, which is a specialized computer built for cryptocurrency mining. It might cost you a good amount of money, and other than your budget, you also need to consider the electricity consumption and hash rate of the miner.
Hardware for Bitcoin Cash Mining
Here are some of the best ASIC miners with their hash rate and power consumption stats.
Miner
Hash Rate
Power Consumption
Antminer S9
12.93 TH/s
1375W +- 7%
Antminer R4
8.6 TH/s
845W +-9%
Antminer S7
4.73 TH/s
1293W
Avalon 7
6 TH/s
850-1000W
Software for Bitcoin Cash Mining
Other than hardware, having the right software tools is also important. You can use many programs especially built for mining Bitcoin Cash, but the following are the best ones.
If you don’t feel comfortable with the command line interface, then we recommend you go with EasyMiner that you can use for both pool and solo mining.
The following are the different methods to mine Bitcoin Cash
- Solo Mining
- Pool Mining
- Cloud Mining
If you’re familiar with cryptocurrency mining, then you would already know that these three are the most common ways to mine any cryptocurrency.
Solo Mining
If you have enough money to buy a powerful miner and you can also bear its electricity consumption, then solo mining will suit you the best. It allows you to keep the complete reward of mining to yourself.
Pool Mining
Unlike solo mining, in pool mining, the reward is split between a group of miners who are contributing their processing power to confirm a Bitcoin Cash block. Currently, the most successful and the largest pools to mine Bitcoin Cash are as followed:
Cloud Mining
If you want to avoid all the hassle of spending money on hardware and setting it up in your close environment, you can opt for cloud mining. In cloud mining, you can access the shared computing power from a company that charges you yearly or monthly. It allows you to simplify the whole mining process where all you need to do is to buy a contract, a simple computer, and a stable internet connection. However, it comes with certain risks that you need to completely understand before making your decision. First of all, you need to stay away from the scammers, and you also need to understand whether the amount for the contract that you’re paying is worth it or not.
How to Purchase Bitcoin Cash?
If you want to invest in Bitcoin Cash for the long term then, purchasing Bitcoin Cash from a reliable vendor is your best choice. There are many online stores that allow you to buy Bitcoin Cash and the most popular one is Coinbase. If your country doesn’t allow you to work with Coinbase, then you can choose any of the following online stores as well:
Bitcoin Cash Wallets
You cannot even start your mining process without having wallets to store your Bitcoin Cash. The cryptocurrency wallet consists of a couple of long random letters and numbers set. One of them is your private key that you keep to yourself, and the other is a public key that you share with other people to transfer or receive BCH. You have to make sure that you never share your private key with anyone to keep your BCH safe and secure because all of your funds can easily be transferred with your private key. Here are some of the wallet types that you can use to store your Bitcoin Cash.
Paper Wallet
A paper wallet is basically a combination of private and public keys printed together generally in the form of a QR code for convenient use. It’s one of the safest ways to store your cryptocurrency as it’s the cold storage type (zero contact with the internet). No one can possibly hack it or steal it from sitting somewhere else, and this makes paper walled entirely safe. Once you have printed your key on paper, you can save it wherever you want, such as a safe deposit box, in your basement, etcetera.
The most convenient way to create a paper wallet is to print the wallet.dat file from your computer located in the wallet. Once you have your private keys printed, you can erase the soft file from your computer to ensure safety. You can also use some online services for the same purpose as well such as:
These tools are open-source and generate random addresses and keys and use the JavaScript engine of your browser to generate the wallet. In simple words, it means that they don’t even use the internet to send you keys.
Bitcoin Cash Software Wallets
Software wallets, as the name suggests, are installed on your mobile or computer, and most of them store your secret information offline. All you need to do is to choose the software wallet and read the instruction manual to install it correctly. Most of the software wallets allow you to store multiple currencies, and you can also create multiple wallets as well. Moreover, some of the wallets also come with the ShapeShift integration that you can use to perform instant exchange between multiple cryptocurrencies. Here’s a list of some of the most popular and safe software wallets that you can use on your device
Hardware Bitcoin Wallets
Hardware wallets are considered to be the safest way to store your cryptocurrencies. They look like typical USBs or portable hard drives, but they are specifically designed to store your digital currency. They can generate your transactions on the fly offline, which means that you can carry them with you wherever you want and connect to any computer to make your transactions.
They are also immune to cyber-attacks like paper wallets as they have no internet connectivity. The latest hardware wallets also offer a backup option, and you can also use multifactor authentication to add another security layer. The best thing about the modern hardware wallets is that they come with a dedicated screen that allows you to use only the wallet to make transactions. But there is a downside to such hardware wallets as they need to connect to the internet. However, you will need to pay for hardware wallets, unlike other types, but they are worth the investment, especially if you have a considerable amount of Bitcoin Cash that you want to store. Here are some of the best options that you can opt for:
Advantages of Bitcoin Cash
As mentioned, Bitcoin Cash is one of the most popular and successful cryptocurrencies available in the market. Just like all the other cryptocurrencies, Bitcoin Cash is also decentralized, and you don’t need to provide any personal information to make transactions. It means that your identity remains safe, and no one can steal it.
Instant Transactions and Bigger Block Size
You can receive and send any amount instantly, as unlike other merchants, there is no waiting time. The block size of Bitcoin Cash is 32 times bigger than the original Bitcoin, which also ensures quick transactions. Not only does it make Bitcoin Cash cheaper and faster, but it also makes it more scalable as compared to most of the major cryptocurrencies. It’s one of the biggest reasons why more and more people are adapting this cryptocurrency.
Lower Fees
As Bitcoin Cash offers more scalability because of its larger block size and quicker transactions, the fees of the transactions are negligible. Not only does it create a win-win situation for the users, but it also eliminates the situation where users need to pay more for quicker transactions. That’s why people like to invest in Bitcoin Cash as it comes with multiple merits. The transaction fee is about 0.20 US dollars per transaction that allows you to save more as compared to Bitcoin.
Customizable Transactions
Not only Bitcoin Cash offers cheap transactions, but it also offers customization as well. It comes with EDA (Emergency Difficulty Adjustment) and an immutable and secure blockchain.
One of the Most Popular Cryptocurrencies
Bitcoin Cash is listed as one of the best cryptocurrencies on all the top crypto exchanges. Not only does it ensure a high level of convenience and ease in investing in this digital currency, but it also brings more people to the community each day.
Disadvantages of Bitcoin Cash
There are also some downsides of dealing with Bitcoin Cash, and some of the most important ones are as following:
Computing Complexity Automatic Adjustment
Bitcoin cash has the automatic adjustment of the computing complexity of the network. It means that the complexity of the mathematical problems is directly proportional to the speed to block confirmation. In simple words, the complexity of the puzzles decreases if the miners don’t get a sufficient number of blocks and vice versa. The miners started exploiting it and started confirming the clock in the time of complexity recession, even with less processing power. It led to the destabilization of the whole network, and it also increased the price volatility of Bitcoin Cash. This problem still resides as it has not been solved, but the development team has included some algorithms that restrain it very efficiently.
Trust Issues
Although the mechanism of this cryptocurrency, just like all the major ones, is decentralized, as the only one elite group decides its roadmap, it appears to be centralized indirectly. This increases many concerns among the existing users, and it also keeps many people from joining the community. Moreover, Bitcoin Cash is still unable to define a distinctive line between itself and Bitcoin that also increases trust issues of new investors.
Lack of Adoption
One of the biggest disadvantages of Bitcoin Cash is the lack of adoption and not having more use cases. The overall crypto community has raised this issue many times that no matter how effective the blockchain mechanism of Bitcoin Cash is, it will stagnate if not many platforms are using it.
Less Investor Confidence
Bitcoin Cash still hasn’t earned the full confidence of investors; that’s why its market penetration and overall use cases are much lower than its competitors. As compared to the original Bitcoin, it also has far fewer trading partners, which essentially makes it less tradable. That’s why big investors still don’t spend their money on this cryptocurrency.
No Cross-Border Payment Protocol
Bitcoin Cash doesn’t offer any cross-border payment protocol such as Ripple (which allows the platform to accept payments from multiple types of vendors). The company is still trying to compete with the other Bitcoin forks, and that’s why such functionalities are missing.
People Call it Copycat
As we have mentioned already, Bitcoin Cash is the hard fork of the original Bitcoin. That’s the reason many people call it a copycat or even a fake coin. Not only does it affect the repute of this cryptocurrency negatively, but it also keeps new people from joining.
The fact of the matter is that there are many functionalities and features that Bitcoin Cash offers that you can’t enjoy with Bitcoin. It comes with no surprise why it’s regarded as one of the best cryptocurrencies of the current time.
What Can You Buy with Bitcoin Cash?
The real purpose of money, regardless of its type, is to buy things, and when it comes to the question of what you can buy with Bitcoin, there are a whole lot of different things that you can enjoy already with this cryptocurrency. The first thing is to find a suitable online store that accepts Bitcoin Cash as an acceptable payment method. Because of the dramatic emergence of cryptocurrency, more and more online stores are adding multiple cryptocurrencies as acceptable payment methods to their portals. One of the best such examples is Coinsbee.
Coinsbee is an online portal that is accessible in over 165 countries, and here you can buy gift cards with Bitcoin Cash, Mobile Phone Topup with Bitcoin Cash, etcetera. This platform also offers eCommerce vouchers, such as Amazon Bitcoin Cash, game vouchers such as Steam Bitcoin Cash.
If you own any other major cryptocurrency, then you can also spend that to get Giftcards for Bitcoin cash, Mobile Phone Topup with BCH as it supports more than 50 cryptocurrencies.
Future of Bitcoin Cash
Bitcoin Cash came with long-term goals and aims, and it’s still on its way to achieving them. But the way it’s handling all the current problems and offering people with better crypto experience makes it a great option to invest in. It’s also considered as the PayPal of the landscape of the crypto world because of its fast, cheap, and easy transactions.
According to the crypto experts, the time of Bitcoin Cash’s peak is still yet to come, and the increasing value of the cryptocurrency backs the claims.
Conclusion
This hard fork of the original Bitcoin demonstrates the unbiasedness of the decentralized system and how a larger block size can help the community. We hope that this information will allow you to understand whether it’s the right cryptocurrency for your investment or not.
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Investing In Bitcoin Cash (BCH) – Everything You Need to Know
https://www.kraken.com/learn/what-is-bitcoin-cash-bch
https://blog-eu.bitflyer.com/what-is-bitcoin-cash-bch/
https://www.bitpanda.com/academy/en/lessons/what-is-bitcoin-cash-bch/
https://whatis.techtarget.com/definition/Bitcoin-Cash
https://www.bitcoin.com/get-started/what-is-bitcoin-cash/
https://www.gemini.com/cryptopedia/what-is-bitcoin-cash
https://support.remitano.com/en/articles/1539401-what-is-bitcoin-cash-bch
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https://bitinfocharts.com/comparison/bitcoin%20cash-size.html
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Bitcoin Cash review, price, features, advantages & disadvantages
https://bravenewcoin.com/insights/bitcoin-cash-vs-bitcoin-how-is-bch-measuring-up
https://cointelegraph.com/bitcoin-cash-for-beginners/how-to-buy-bitcoin-cash
