What is Bitcoin Cash? | Beginner’s Guide to Bitcoin Cash

What is Bitcoin Cash? | Beginner’s Guide to Bitcoin Cash

Bitcoin Cash - cryptocurrency was created in 2017 as a result of Bitcoin's hard fork. This split occurred due to the lack of agreement in the community regarding the method of scaling and further development of the Bitcoin project.

What is Bitcoin Cash? | Beginner’s Guide to Bitcoin Cash

Bitcoin Cash - cryptocurrency was created in 2017 as a result of Bitcoin's hard fork.

Bitcoin Cash Project Description

Bitcoin Cash is a cryptocurrency based on peer-to-peer technology. It is based on the same idea as Bitcoin, ie it plays the role of electronic cash. It was created as a result of a hard forum, or a fragment of the bitcoin database. This event occurred as a result of the split in the group of developers who decided that introducing a larger block and increasing the network speed are necessary. Not all community members shared this sentence. Another reason was the fact that Bitcoin has departed from the idea of being a form of payment and more has become an investment asset. The main goal of the creators was to achieve low transaction costs.

Specification of Bitcoin Cash

Bitcoin Cash uses the following solutions:

  • OnChain scaling - network scalability has been raised to 8 megabyte blocks. The block size can be increased in the future. OnChain relies on scaling the main BCH chain, which is a different solution than in Bitcoin where additional side chains are created (off-chain)
  • DAA - a new algorithm that adjusts the hashing algorithm. Miners are free to switch between Bitcoin Cash and Bitcoin Legacy, thanks to this solution the algorithm will adjust the difficulty of mining and protect against downtime. DAA balances the speed of the hashrate to the block interval every 600 seconds. Quick adjustment of mining difficulties to computing power.
  • Sighash - gives protection against chain splitting. It protects against prolonged confirmation time of subsequent blocks. Removes quadratic scaling of hashed signatures which increases network security.

Mining Bitcoin Cash

Currently, the difficulty of mining BCH is lower than in the case of Bitcoin. For mining, various mining rigs are used, such as: Antminer S7, which are more efficient than the GPU. BCH uses the same algorithm as BTC - SHA-256.

Bitcoin Cash Wallets

Bitcoin Cash Vs Bitcoin

Bitcoin Bitcoin Cash
Speed of creating new blocks 10m 10m
Algorythm SHA256 SHA256
Privacy To use Bitcoin (and other cryptocurrencies) you only need to have a public and private key that does not contain any user data such as personal data or the address of residence. The anonymity is theoretically ensured. In practice, you have to do a lot of work because all transactions and public addresses are public on the web - what is the essence of Bitcoin. It is not impossible to trace transaction history and with appropriate determination you can link the address to the user, eg by analyzing its activities in the network using Bitcoin addresses and IP address. To minimize the risk, you should keep your funds on more addresses, make transactions from different addresses, and ultimately use the sites that offer coin mixing. As with Bitcoin, you must have a wallet address (private key). The same solutions were applied in matters of privacy.
Speed The confirmation time is quite long and sometimes is over a few hours. Currently, due to the increasing number of transactions per second, not all transfers go straight to the block. It depends on the transaction fee - the higher it is, the sooner it will be in the block and will be confirmed. The confirmation speed is faster than in the case of Bitcoin.
Others The entire mining reward goes to the miners. The result is a fairly expensive maintenance of the BTC network. Bitcoin is based only on mining BCH has larger blocks - 8 MB. Has some improvements compared to BTC, e.g. DAA. Making decisions about activities in the project are made on the basis of consensus (development teams).