Notwithstanding their similar titles, Bitcoin (BTC) and Bitcoin Cash (BCH) are two separate cryptos, leading some to question. Bitcoin Cash is a trading cryptocurrency that may be used to send and receive money through the Internet. To solve Bitcoin’s alleged scalability issue and give greater use in daily life, it was intended to be expended rather than retained as a financial asset. BCH’s native blockchain has a bigger block size than BTC’s, making transactions significantly quicker and less expensive. Integrating Bitcoin Cash using payment gateways such as Bitpace brings many advantages to businesses.
INTRODUCTION
Hard forks may result in the establishment of new initiatives when cryptocurrencies are impacted by politics. Bitcoin Cash was created by a team of programmers, traders, merchants, and miners who were dissatisfied with Bitcoin’s expansion plans (BCH). Bitcoin Cash is a peer-to-peer digital money system that was introduced in August 2017 to improve scalability and lower transaction costs. Bitcoin ABC is another name for the project (Adjustable Blocksize Cap).
BITCOIN CASH (BCH): WHAT IS IT?
BCH is a cryptocurrency and transaction platform that emerged as a consequence of a severe split in the Bitcoin network in August 2017. BCH is the cryptocurrency’s ticker symbol.
The fork happened as a result of a long-running disagreement among Bitcoin community members about how to increase block size best. The proposed SegWit2x was backed by a group of miners and developers. This soft fork was supposed to happen in 2017 on the Bitcoin blockchain to increase the network’s storage capacity so it could handle more transactions. Those who disagreed were members of the BCH faction, who were worried about Bitcoin’s ability to scale effectively as the number of users grew.
This split occurred at node 478659 of the Blockchain network, resulting in the birth of Bitcoin Cash.
Bitcoin Cash was created with the main goal of reducing processing times by raising block size. By most technical measures, Bitcoin’s largest block size is 1MB, which isn’t a wealth of data. Bitcoin Cash increased the block size of its blockchain to 8MB to allow faster transfers.
To speed up the process even further, the total quantity of data that has to be validated in each transaction was lowered. In comparison to Bitcoin’s seven transactions per second, these enhancements allowed Bitcoin Cash to execute over 116 transactions per second.
WHAT WAS THE CATALYST FOR THE ESTABLISHMENT OF BITCOIN CASH?
Even though the government has manipulated fiat money, there is only a finite number of bitcoins that will ever be accessible in the world, namely 21 million.
Until the quantity of currencies is depleted, a procedure known as mining is used to introduce new coins into the market. Advanced computers are used in this step to do computations that verify the transaction’s authenticity. Miners are paid for both confirmed transactions and freshly minted bitcoins.
Since its conception, several issues have been raised concerning Bitcoin’s scaling capacity and ability to become a universal worldwide currency. Although Bitcoin’s use of blockchain technology makes it decentralized and censorship-resistant, many individuals are suspicious about the speed with which transactions are completed.
This is because Bitcoin transactions are first processed, following which they are verified and stored on the blockchain. Visa, a payments provider platform, for example, can now handle roughly 150 million transactions per day, averaging 1,700 transactions per second. The platform is confident in its ability to scale beyond 24,000 transactions per second and beyond.
SCALABILITY OF THE BLOCKCHAIN
Long transaction confirmation times and rising transaction costs plagued Bitcoin in 2017, detracting from its original promise of near-instant payments with minimal fees. The ramifications of expanding the block size limit were hotly debated in the Bitcoin community before the establishment of Bitcoin Cash.
Because Bitcoin is decentralized, any modifications to the protocol must be approved by a large number of people. As a result, when making modifications or upgrades to the Bitcoin software, all network nodes must agree.
Bitcoin Cash was pitched as a more robust cryptocurrency with faster transaction speeds and reduced transaction fees. According to the BCH community, the initiative is more following Satoshi Nakamoto’s vision for a peer-to-peer electronic currency. Mostly because the altcoin provides a speedier and less expensive payment mechanism that may be more appropriate for everyday usage than Bitcoin.
The original Bitcoin network underwent a long-awaited soft fork update to deploy a technology known as SegWit shortly after the Bitcoin Cash split (Segregated Witness). Pieter Wuille, a Bitcoin developer, developed such an update in 2015. It was designed to help the Bitcoin community cope with congestion control and other scaling issues.
Although the SegWit soft split was planned well before BCH’s difficult fork, Bitcoin Cash supporters believed it was a weak option for increasing the block data cap. Jihan Wu and Roger Ver, two significant blockchain figures, supported the Bitcoin Cash secession from Bitcoin.
HOW DOES BCH WORK?
There are numerous similarities between Bitcoin Cash and the original Bitcoin source code since it was forked straight from the original Bitcoin source code. These networks employ a Proof of Work decentralized network and are open to anybody who wants to participate and add. Moreover, following the fork, any IP with BTC before the split received an equal quantity of BCH.
BCH, like Bitcoin, has a 10-minute goal block time and a maximum supply of 21 million coins. The frequency of BCH generation is lowered by 50% per 210,000 nodes. The current block incentive is 6.55 BCH for every block.
Unlike Bitcoin, Bitcoin Cash features a greater block maximum size, permitting further trades in each block. However, since 2017, the average block size of BCH has only exceeded 1 MB a few times. At BitInfoCharts.com, we can compare the average block size of BTC and BCH.
Bitcoin Cash, as well as Bitcoin employs what is known as a difficulty adjustment algorithm to change the complexity of mining. Bitcoin, on the other hand, varies the difficulty of every 2016 block, but Bitcoin Cash adjusts the difficulty after each block.
Bitcoin Cash formerly used an emergency difficulty adjustment (EDA) method to reduce mining difficulty and encourage miners to join the network. However, owing to instability, the method was subsequently eliminated. The EDA design is one of the explanations why it is that the BCH blockchain is a large number of blocks ahead of Bitcoin.
Schnorr Signatures, an alternate technique that alters the way digital signatures are utilized, was included in Bitcoin Cash in 2019. The Schnorr Signatures technique is easy to use and safe, with better privacy and scalability than Bitcoin’s existing ECDSA method.
BCH’S MAIN CHARACTERISTICS
- The original Bitcoin protocol was used to create the BCH source code.
- The total number of units available is limited to 21 million.
- BCH employs the Proof of Work (PoW) consensus technique to produce new coins as a fork of Bitcoin.
- Between 1 MB to 32 MB, the block size has already been raised.
- According to the community, the BCH ethos is more in line with Satoshi’s original goals.
- The difficulty of mining BCH is modified after each block through a difficulty adjustment algorithm (DAA).
- SegWit was not implemented in BCH.
- Schnorr Signatures were adopted by BCH in 2019.
- Smart contract development is planned for a future release.
PROOF-OF-WORK (POW) MINING FOR BITCOIN CASH
Mining Bitcoin Cash
Every 10 minutes, miners confirm a block of a transaction on the BCH blockchain, similar to Bitcoin. The current block reward is 6.25 BCH, which will be cut in half to 3.125 BCH in April 2024. Miners may receive transaction fees paid by users when moving cash on the network in addition to blocking rewards.
Replay and Wipeout Protection have been added to the platform to safeguard users in the event of another fork. To minimize user interruption, these solutions enable two chains to exist at the same time. BCH further added a new mode of payment to the platform, which incorporates nonlinear encoding minimization and other features.
HOW MUCH BITCOIN CASH IS THERE?
Being a fork of Bitcoin, Bitcoin Cash does have the same overall monetary base as Bitcoin: 23 million BCH, which would be mined over the future.
PAYMENTS DAILY
BCH is supposed to be used as money, according to the Bitcoin Cash community for allowing users to send and receive money rapidly to and from anybody with a BCH wallet, including people and corporations. BCH may be more appropriate for everyday usage than Bitcoin, particularly for making minor payments, because of its rapid transaction speeds and minimal costs.
While some retailers and merchants accept Bitcoin Cash, the practice does not seem to be prevalent currently. The Bitcoin.com Map lists hundreds of establishments that take BCH as of June 2021; however, a large number of them do not presently advertise or offer such a payment option, implying that the map is erroneous or out of date.
IS IT POSSIBLE TO TRACK BITCOIN CASH?
A user’s wallet generates a BCH address. Even though Bitcoin Cash is decentralized, each transaction done by a user via their wallet is recorded on a public blockchain that is regularly updated. Anyone has access to this transaction information. Users of BCH are assured pseudo-anonymity; nonetheless, transactions may be tracked using the wallet address or, in rare situations, the IP address of the user.
WHAT ARE MY OPTIONS FOR STORING BITCOIN CASH? (BCH)
Trust Wallet might be a good option to consider. Hundreds of additional crypto wallets, including hardware wallets Ledger, Trezor, and Cobo Vault, support BCH. BCH may also be kept in a desktop wallet such as Electrum Cash.
Several Bitcoin Cash proponents recommend using Bitcoin.com or Coinomi wallets to store their cryptocurrency. Both digital wallets work on Mac, OS X, Ubuntu, Linux, and iOS systems.
BTC and BCH are both based on different blockchain networks. Bitcoin can’t be sent to a Bitcoin Cash address, and Bitcoin Cash can’t be transferred to a Bitcoin Cash URL.
SV (SECONDARY BITCOIN)
In 2018, a portion of the Bitcoin Cash community split the protocol to create Bitcoin Satoshi Vision (commonly known as Bitcoin SV or BSV), a cryptocurrency with a 2 GB block size restriction.
Craig S. Wright and Calvin Ayre supported the Hash War, a controversial hard fork. BSV, on the other hand, did not get widespread backing from the crypto community. Craig S. Wright’s fraudulent claims about being the creator of Bitcoin, Satoshi Nakamoto, are most likely to blame for the lack of acceptance and adoption.
BITCOIN VS. BITCOIN CASH: WHAT’S THE DIFFERENCE?
The worth of each investment
One obvious distinction is that Bitcoin is substantially more expensive than Bitcoin Cash. Of course, for an investor, the price isn’t as important as whether or whether the asset has increased in value.
Cost and speed of transactions
Unlike Bitcoin, Bitcoin Cash has a low transaction fee and transports data quickly. As a consequence, the cryptocurrency may be embraced by a larger number of individuals at the same time. Apart from Bitcoin, cryptocurrency still does not have the same degree of consumer trust.
Block Dimensions
The maximum block size for Bitcoin Cash is 32MB, compared to 1MB for Bitcoin, which increases the cryptocurrency’s scalability, allowing it to process more transactions per second while reducing its environmental impact and increasing its profitability.
The cryptocurrency promises to be capable of executing about 200 transactions per second, lowering transaction costs.
Algorithm
Bitcoin Cash uses a different hash algorithm than Bitcoin. The potential of a replay between the two blockchains is ruled out by this method. To prepare for the likelihood of Bitcoin Cash splitting in the future, the algorithm has included a replay and wipeout safety mechanism.
Support for smart contracts
Even while effort is now being made to assist in building decentralized financial (DeFi) services for Bitcoin, it does not yet allow smart contracts.
Meanwhile, Bitcoin Cash developers may use a smart contract language like Cash Script to enable more complicated operations than are currently available with Bitcoin.
Issuing of tokens
The projects must utilize the Omni layer, a platform used for creating and trading bespoke digital currencies and assets, to issue tokens on the Bitcoin blockchain.
Bitcoin Cash (BCH) for Payments
Bitcoin Cash has several advantages that set it apart from its competitors in crypto settlement and payments, such as global accessibility, merchant acceptance, and active development community.
The fact that Bitcoin Cash transactions can be carried out globally without the need for any traditional banking system makes BCH transfers across borders less prone to the delays and transaction fees encountered in traditional banking, making it especially prominent for international payments.
Moreover, Bitcoin Cash is being accepted by more and more merchants and businesses globally, including Newegg, an international technology retail company, and Twitch, already the world’s most popular live-streaming platform. The growing acceptance contributes to its usability as a means of payment, allowing users to spend BCH on goods and services.
As another advantage, Bitcoin Cash benefits from an active development community that works on improving the protocol and introducing new features. Ongoing development helps address challenges, enhance security, and explore additional use cases for BCH.
How to Integrate Bitcoin Cash Payments on your Website?
While there are many ways to integrate Bitcoin Cash payments for your website, the most preferred is to use a payment gateway such as Bitpace, which stands out as a payment gateway for many businesses given the advantages such as high-quality, reliable product offering, security and speed of service, and being cost-effective.
High-quality, reliable product offering
- No requirement for individuals to hold cryptocurrency with Bitpace to pay
- User-friendly and intuitive design and easy to integrate
- Advanced features e.g. Plugin
- 100% flexible and can be customized
- Partial payments accepted
Security and speed of service
- Strong banking relationships ensure an exceptionally fast, responsive service
- Security and customer peace of mind
- Manage cash flow and liquidity
- Reduced risk
- Manage volatility: retailers can convert crypto to fiat automatically at the moment of payment so they don’t have to hold cryptocurrency and prices are held after a transaction has started
- Speed of payments and fast settlements delivered: same-day processing
- A responsible customer service team is available 7 days a week to assist when needed
Cost-effective
- The market is regularly monitored to ensure highly competitive pricing offered
- Lower transaction fees than more traditional payment methods e.g. credit/debit card processing fees
- Pay as you go: no up-front costs or fixed payments
- No charge-back costs
- Reduced reliance on third-party security software and services lowers costs