While everybody is talking about Bitcoin, not all users know that there is a hard fork from Bitcoin called Bitcoin Cash. What is Bitcoin Cash though? How is it different from Bitcoin, what was the main reason for its creation, and what are the forecasts? Let us check in detail.
Bitcoin was launched in 2009. It is considered the first fully functional cryptocurrency and without a doubt, it is the most successful coin. This is the first coin that is decentralized which means that Bitcoin isn`t controlled by any authority.
The Basics of Bitcoin Work
Bitcoin was launched in 2009 and is regarded as the first cryptocurrency. It is undoubtedly also the most expensive cryptocurrency for now.
Basically, Bitcoin is a code, a string of symbols, stored on the blockchain. When a Bitcoin is bought or sold, some symbols change in the initial string, and a new string of symbols, thus, a new coin is formed. All coins are stored on an open-source public ledger called the blockchain.
To access coins, people use special private keys. A private key is a string of symbols used to prove that a coin belongs to a specific user. The one owns a coin who has a private key to it. Private keys are stored in wallets. A wallet is a special place or device used to store the private keys of a specific user.
For example, when you use a BCH to BTC exchange on LetsExchange.io, you provide the wallet address to receive the exchanged funds. However, you will never be asked to share your private key to complete a transaction.
With time, Bitcoin used to become increasingly popular, people were getting more interested and willing to pay more. It was the main reason why the transactions in the Bitcoin network started slowing down. Then, a decision was made to create a cryptocurrency that would solve the issues Bitcoin started facing. Bitcoin Cash was created.
Bitcoin Cash was launched in 2017 with the intention to solve the issues that Bitcoin started facing such as scalability, transaction fees, resources needed to mine coins, and similar. All the users that owned Bitcoins received the same number of Bitcoin Cash coins.
We can compare Bitcoin Cash with a new version of Microsoft Word. While it can open the documents created by an older version, the same older version cannot open the documents created by the newer release.
While Bitcoin Cash is cheaper than Bitcoin, it can be exchanged on almost all exchanges such as https://letsexchange.io/, Binance, Changelly, and others.
The main differences between the two currencies are the following:
- The node size: in the Bitcoin network, it is smaller which allows even private users to run nodes. In the Bitcoin Cash network, nodes can be big companies.
- The difficulty adjustment algorithm: Bitcoin adjusts the mining difficulty after every 2016 block. In the case of Bitcoin Cash, the mining difficulty is adjusted after every block mined.
Now, Bitcoin Cash is among the leading cryptocurrencies in the world even though it still has a long way ahead to reach Bitcoin.