Bitcoin Cash (BCH) is a form of cryptocurrency much like Bitcoin. In fact, Bitcoin Cash was a fork of Bitcoin as a result of a chain split when a certain group of Bitcoin developers became dissatisfied with Bitcoin’s overall scalability direction.
In November 2018, the Bitcoin Cash community would later further split into Bitcoin Cash and Bitcoin SVvia another hard fork. The latter camp, supported by Craig Wright and Calvin Ayre proposed a competing software version called Bitcoin Satoshi Vision that would take the block size limit further to 128MB.
On November 15th, 2020 the Bitcoin Cash experienced another hard fork. The forked occured on block #661647 have led to the launch of Bitcoin Cash ABC(BCHA). The Bitcoin Cash ABC network includes a miners' tax where 8% of the mining rewards will be distributed to the BCHA developers as financing for protocol development.
To sum it up simply, the Bitcoin Cash developers were originally dissatisfied with the decisions made in regards to Bitcoin’s development. Specifically, they were dissatisfied over the implementation of Segregated Witness(SegWit). The Bitcoin Cash developers believe that SegWit is a compromise to the decentralization of the Bitcoin network. They believed that the network could have increased its block size instead in order to allow Bitcoin to grow as a currency. Together, this group formed a plan to split from the Bitcoin blockchain and created Bitcoin Cash with a larger block capacity limit of 8 MB. Bitcoin went ahead with their plan to implement SegWit but the newly forked Bitcoin Cash did not implement SegWit. On 15 May 2018, the Bitcoin Cash block size limit was subsequently increased from 8 MB to 32 MB.
On 15 November 2018, Bitcoin Cash experienced a chain split from within its own community that resulted in the creation of Bitcoin SV. The creators of Bitcoin SV argued that Bitcoin Cash is no longer staying true to the original vision of the Bitcoin Whitepaperand decided to split off to form their own coin.
How does Bitcoin Cash differ from Bitcoin?
As Bitcoin Cash is a result of a chain split from Bitcoin, it shares much of Bitcoin’s fundamental workings. In fact, they even share the same history.
Due to it being a fork of bitcoin, all on-chain data prior to the split are inherited. If you owned 1 bitcoin before the creation of Bitcoin Cash, you now have 1 BTC and 1 BCH, which can both be signed using the same private keys.
However, Bitcoin and Bitcoin Cash are not non-interoperable. You cannot send your Bitcoin Cash to the Bitcoin network and somehow own 2 BTC. Your bitcoin cash and bitcoin now exists on two different sets of blockchains.
One of the main differences between Bitcoin and Bitcoin Cash is the block size limit and transaction fee. As Bitcoin Cash has bigger blocks and arguably lower usage, sending Bitcoin Cash on the network is relatively cheaper and faster than if done on Bitcoin. In that sense, Bitcoin Cash does serve as a faster and more efficient form of digital currency as extolled by Bitcoin Cash proponents.
Who is the team behind Bitcoin Cash?
The Bitcoin Cash fork from Bitcoin was supported by some of the critical members of the crypto community, including Jihan Wu (Bitmain) and Roger Ver (Bitcoin.com).
Later in 2018, a faction within the Bitcoin Cash community, supported by Craig Wright and Calvin Ayre, led to another contentious hard-fork, with a permanent chain-split. It ultimately led to the creation of Bitcoin Satoshi Vision (“Bitcoin SV”). This event was referred to as the “hash-war”.
Since its creation, the Bitcoin Cash project has been maintained by core developers and contributors from the community.
Controversy of Bitcoin Cash and Bitcoin
Bitcoin supporters were separated into two teams: 1) Big blockers who prefer Bitcoin as a currency and a medium of exchange. 2) Small blockers who use Bitcoin as a medium that stores value.
In August 2017, the big blockers succeeded and the hard fork applied and created Bitcoin Cash. However, the debate and argument between the community of Bitcoin and Bitcoin Cash did not stop until today. They exchanged insults and vulgars, hurting each other with their self ego.
There were reports of Bitcoin Cash leveraging the name “Bitcoin” and it confuses people to believe that Bitcoin is endorsing Bitcoin Cash. Despite all the dramas and conflicts, Bitcoin is still standing strong when compared to Bitcoin Cash. Bitcoin Cash is currently trading at around five tenths of the value of Bitcoin.
Why did Bitcoin Cash split to Bitcoin SV?
After the split from the Bitcoin network, a civil war was started in 2018 and it diversified the Bitcoin Cash community into Bitcoin Satoshi Vision (Bitcoin SV) and Bitcoin Cash. Due to the constraint of block size of Bitcoin and Bitcoin cash, Bitcoin SV proposed to implement the block size to 128mb to speed up the transaction speed and cost on the blockchain network.
On 15 November 2018, a hard fork on the blockchain splitted the Bitcoin Cash and Bitcoin SV. Currently, Bitcoin Cash’s value is triple of Bitcoin SV.
How to mine BCH？
BCH could not be mine as they are using Proof of Work (POW). You would need to set up dedicated mining rigs to be able to mind BCH. The setup would be very similar to building mining rigs to mine Bitcoins.
What is BCH Difficulty Adjustment Algorithm (DAA)?
When Bitcoin Cash has just migrated from Bitcoin, most of the hash power favours Bitcoin. This has caused serious issues to the Bitcoin Coin blockchain network. Due to the low computational power, the block time is far off the targeted 10 minutes blocktime. To resolve this issue, Bitcoin Cashs; developers decided to implement the Emergency Difficulty Adjustment (EDA) to reduce the blocktime.
They proposed to reduce the difficulty of the block by 20% if the time between the previous 6th block and 12th block is more than 12 hours. The solution has resolved the issue in the short term. However, the difficulty adjustment mechanism caused huge fluctuations in the difficulties and this resulted in the Bitcoin Cash blockchain to run ahead by more than a thousand blocks when compared to Bitcoin.
Eventually, the flawed Emergency Difficulty Adjustment was retired and replaced by a new Difficulty Adjustment Algorithm (DAA) on 13 November 2017. The new Difficulty Adjustment Algorithm determines the difficulties of a new block based on the moving average window of the past 144 blocks. This has greatly reduced the fluctuations of difficulties on the blockchain.
Where to store BCH?
Bitcoin Cash (BCH) is hosted on the Bitcoin Cash network, therefore, you would need to set up a wallet that supports it. Some of the popular crypto wallets that support storing BCH are MetaMask and imToken.
