BTC or BTC Cash?
What are BTC and BTC Cash?
Bitcoin Cash (BCH) emerged in 2017 as a solution to Bitcoin's increasing capacity challenges, which resulted in a controversial hard fork that led to the creation of a new blockchain. BCH offers improved scalability specifications such as larger block sizes, enabling faster and more affordable transactions. With a transaction block size of 32MB, BCH can handle over 100 transactions per second, while Bitcoin's capability is limited to only seven transactions per second. While Bitcoin is mostly known for its value as an investment, Bitcoin Cash has a competitive advantage in daily crypto purchases. However, Bitcoin remains the most popular cryptocurrency due to its popularity and growing efficiency in payment methods through layer two solutions like the Lightning Network, as evidenced by its significant margin in adoption compared to Bitcoin Cash. During the 2021 bull run, Bitcoin has outperformed Bitcoin Cash in terms of ROI over the past three years.
Differences between Bitcoin (BTC) and Bitcoin Cash (BCH):
Initially designed as a decentralized global payments network, Bitcoin faced challenges as the number of users grew exponentially, leading to longer transaction processing times. The network's technological limitations, restricting the maximum amount of data per transaction block to 1MB, contributed to this problem.
To address these scalability issues, in July 2017, users representing 80-90% of Bitcoin's computing power voted to adopt Segregated Witness (SegWit), a technology that removes signature data and reduces block size by up to 65%, thereby increasing the number of transactions per block. However, a group of Bitcoin miners and developers opposed SegWit's adoption, believing that it did not adequately address the network's scalability problems and detracted from Bitcoin's original vision as a means of value exchange.
To counter SegWit, the opposing faction proposed a rules change to increase the Bitcoin transaction block size from 1MB to 8MB, allowing for more transactions per block. The majority of network users rejected the proposal, resulting in the first hard fork of the Bitcoin blockchain. This hard fork created Bitcoin Cash, a new cryptocurrency with its own blockchain and scalability specifications. The Bitcoin Cash block size has since grown to 32MB, enabling faster and cheaper transactions than Bitcoin.
Despite the hard fork, Bitcoin remains a popular cryptocurrency, with many investors seeing it as a speculative asset, while Bitcoin Cash has gained traction as a means of value exchange. However, Bitcoin's efficiency in payment methods through layer two solutions such as the Lightning Network makes it the most popular cryptocurrency by far.
Facts about BTC and BTC Cash:
- Bitcoin was created in 2009 by an individual or group of individuals using the pseudonym Satoshi Nakamoto.
- Bitcoin has a limited supply of 21 million coins, of which approximately 18.7 million have already been mined as of February 2023.
- Bitcoin transactions are recorded on a public ledger called the blockchain, which allows for secure and transparent transactions without the need for a trusted intermediary.
- Bitcoin operates on a peer-to-peer network, with transactions being verified and recorded on a public ledger called the blockchain.
- Bitcoin has been used for various purposes, including as a store of value, a speculative asset, and a means of payment.
Bitcoin Cash (BCH):
- Bitcoin Cash was created in 2017 as a result of a hard fork of the original Bitcoin blockchain.
- The primary motivation behind the creation of Bitcoin Cash was to address Bitcoin's scalability issues by increasing the block size limit from 1 MB to 32 MB.
- Bitcoin Cash allows for faster and cheaper transactions compared to Bitcoin, with a capacity of over 100 transactions per second.
- Bitcoin Cash is the sixth most popular cryptocurrency used according to CoinMarketCap, and has a market capitalization ranking of 26th as of February 2023.
- Bitcoin Cash has faced criticism from some in the cryptocurrency community who believe it has strayed from the original vision of Bitcoin and that its development is centralized.
Bitcoin(BTC) as an investment?
As the use of cryptocurrency for payments continues to increase, Bitcoin has emerged as a leading investment option, with its status akin to that of digital gold. During the 2021 bull run, Bitcoin delivered a three-year ROI that was significantly higher than that of Bitcoin Cash, which has not fared as well.
As of September 1st, 2017, the value of 1 Bitcoin Cash (BCH) was approximately $400, while three years later, the value had only increased to around $600. If an investor had purchased 1 Bitcoin Cash on September 1st, 2017, and sold it on the same day in 2021, their ROI would have been roughly $200 or 50%.
By contrast, the value of 1 Bitcoin on September 1st, 2017, was about $4,400, and after three years, it had increased to around $48,000. If an investor had purchased 1 Bitcoin on September 1st, 2017, and sold it on September 1st, 2021, their ROI would have been around $43,600, or nearly 986%.
Bitcoin Cash (BCH) as a payment?
As a blockchain network's transaction processing speed is measured in TPS (transactions per second), it directly impacts user convenience and transaction cost. In January 2023, the Bitcoin Network could process only 7 transactions per second, even after implementing SegWit. Meanwhile, Bitcoin Cash's 32MB block size enables it to process over 100 transactions per second, making it more suitable for everyday crypto purchases. However, layer 2 solutions such as the Lightning Network have made Bitcoin more efficient as a means of payment.
You might ask:
1. Are BTC and BCH on the same blockchain?
Bitcoin Cash was created through a process known as a "hard fork," where it separated from the original Bitcoin blockchain to form its own network and digital currency.
2. Do I need two separate wallets to own Bitcoin and Bitcoin Cash?
Shortly yes, but some wallets are having functions to store assets in a single place. It’s called a multi-asset wallet.
On Cryptal, you need to create two separate addresses.
3. Where can I buy Bitcoin (BTC) and Bitcoin Cash (BCH)?
Bitcoin Cash (BCH) is a cryptocurrency that emerged in 2017 as a solution to Bitcoin's scalability issues. Its larger block size of 32MB allows faster and more affordable transactions, making it more convenient for everyday crypto purchases than Bitcoin, which is mostly known for its value as an investment. Bitcoin faced challenges with longer transaction processing times due to its technological limitations, leading to a hard fork that created Bitcoin Cash. Bitcoin remains the most popular cryptocurrency due to its popularity and growing efficiency in payment methods, while Bitcoin Cash has gained traction as a means of value exchange. Bitcoin is mostly used as a store of value and a speculative asset, while Bitcoin Cash is more suitable for everyday crypto purchases.