Bitcoin Cash on the Rise: Should You Choose BCH Over BTC?
Have you heard of Bitcoin Cash? Do you think it’s a better alternative to Bitcoin? Bitcoin rose to prominence as an alternative to Bitcoin, and it is currently one of the most valuable cryptocurrency assets by market capitalization. This was launched on August 1, 2017, to offset the increase in transaction wait times and fees on the original Bitcoin network. Bitcoin Cash multiplies the number of transactions that can be executed in each block.
This guide explains the rise of Bitcoin Cash and whether it’s an alternative to Bitcoin.
Bitcoin Cash
Bitcoin Cash is a different story. In 2017, this was created by Bitcoin developers who had the cryptocurrency’s future at heart. They created Bitcoin Cash with its blockchain and specs, with one key distinction from Bitcoin: it has an 8 MB block size to speed up the verification process.
How Does Bitcoin Cash Work?
Bitcoin Cash keeps several aspects of the original Bitcoin blockchain. It retains the Proof of Work consensus process, and the majority of the network’s first miners are from the original Bitcoin network. The fork in the Bitcoin blockchain also resulted in a 1:1 airdrop of Bitcoin Cash on the new network. The total quantity of Bitcoin Cash (BCH) is also set at 21 million. However, Bitcoin Cash takes a different approach to creating a speedier and more flexible system. These include an expandable block size and smart contracts. Let us explain them:
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An Expanded Block Size
Bitcoin Cash has a higher block size, starting with 8MB and increasing over time to 32MB at the time of writing.
This block size supports more than 25,000 transactions, which allows the Bitcoin cash network to perform about 100 transactions per second, 14 times quicker than the Bitcoin blockchain.
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Smart Contract
The introduction of ordinal NFTs and BRC-20 tokens means that the original Bitcoin blockchain can work similarly to other smart contract blockchains, even though they differ significantly from regular smart contracts. Bitcoin’s Layer 2 Lightning Network is also considered a smart contract application because it leverages its smart contract scripting language to facilitate off-chain transactions.
However, the Bitcoin Cash network has already built smart contract functionality, which supports smart contracts and side chains. CashScript, a smart contract language designed specifically for creating apps on the Bitcoin Cash network, is used to create Bitcoin Cash smart contracts.
Bitcoin vs Bitcoin Cash: Key Differences
Here are the main distinctions between them:
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Block Size Limit
Bitcoin has a block size restriction of 1 MB; however, Segregated Witness (SegWit) effectively permits additional data to be processed by segregating transaction signatures.
On the other hand, when Bitcoin Cash was launched, the block size limit was upped to 8 MB, with later updates allowing for even larger blocks. This is meant to handle more transactions per block while lowering costs and transaction times.
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Transaction Fees
Due to the limited space in each block, Bitcoin can have higher transaction fees, particularly during moments of network congestion.
On the other hand, because of Bitcoin Cash’s greater block size, which can support more transactions, it typically offers lower transaction fees.
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Market Position
Bitcoin is the most well-known and valuable cryptocurrency, frequently serving as a benchmark for the whole crypto market.
Bitcoin Cash: While significant in its own right, it has a lower market value and less influence in the larger cryptocurrency scene.
Understanding these distinctions is critical for anyone wishing to interact with or invest in various cryptocurrencies since each has unique benefits, challenges, and applications.
Smart Contract Capabilities of Bitcoin vs Bitcoin Cash
- Tapscript: This is the scripting language included with Taproot. It improves Bitcoin’s scripting capabilities and makes it easier to build sophisticated transaction spending rules.
- Privacy and Efficiency: Taproot improves privacy by rendering complex transactions indistinguishable from simple ones when spent. It also minimizes the number of complex transactions, which leads to increased efficiency.
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Conclusion
Bitcoin Cash benefits from the increasing connectivity between traditional finance and the crypto realm with EDX Markets. Native crypto institutions (including some of the most reputable ones) have been heavily entwined with regulatory complications.
EDX Markets’ goal is to create a platform for assets that are free of these issues, thereby avoiding controversial regulatory implications and attracting the most viable investor class.
If it lives up to its boasts, conventional investors will be able to enter the crypto world without concern about investing in the wrong asset class and its consequences. This might be a successful link between traditional finance and cryptocurrency or simply a transfer of resources from the bigger TradFi industry to the smaller crypto sector.
Any one of these will benefit the cryptocurrency space. The increase in the value of Bitcoin Cash and other listed assets (at the time of writing) demonstrates what this relationship could bring to the crypto market.