Bitcoin is the first decentralized digital cryptocurrency which can be transacted between different users without the need for a trusted centralized bank. The bitcoin transactions are recorded in a shared distributed ledger which is maintained by the computer nodes (peer nodes) in a peer-to-peer (P2P) network. The underlying technology is called as distributed ledger technology (DLT) or Blockchain. The ticker symbol for Bitcoin is BTC.
Last year in 2017, Bitcoin Cash came into existence. Having similar names, it may get confusing as to whether they are same? Can Bitcoins be converted into Bitcoin Cash based on any formula? Well, Bitcoin and Bitcoin Cash are different.
If you have come across this newer cryptocurrency, namely, BitcoinCash, you must be wondering abount some of the following which you will learn in this post.
- What is BitcoinCash? What is ticker symbol?
- How is BitcoinCash different than Bitcoin?
- What are some of the cryptocurrency exchanges where both Bitcoins and BitcoinCash are traded?
Why Bitcoin Cash when there were Bitcoins?
As Bitcoin grew into popularity and saw greater adoption, the volume of transactions at any given point of time started increasing in leaps and bounds. However, at any point, a block of size 1 MB could only be mined and added to the blockchain. Thus, it started getting delayed for transactions to be included in a block and getting confirmed due to the limited size of Block. At times, those paying higher fees started seeing their transactions getting confirmed earlier. This made the bitcoin unreliable and users started moving away from using Bitcoins.
Due to above problem of higher fees and delayed confirmation of Bitcoin transactions, a need to scale the Bitcoin came into the picture. There was an option to increase the block size of Bitcoin Blockchain from 1 MB to larger number. However, due to the disagreement between developers in the Bitcoin Blockchain, it was decided that Bitcoin Block size won’t increase.
This is where another cryptocurrency BitcoinCash was conceptualized with a primary goal to grow and scale with lower fees and faster confirmations. On August 1, 2017, a hard fork of Bitcoin Blockchain resulted in BitcoinCash Blockchain. The following are some of the characteristics of Bitcoin Cash Blockchain.
- Upgraded consensus rules
- The larger block size of 8 MB to accommodate larger number of transactions than what could get stored in a Bitcoin block of size 1 MB.
What is Bitcoin Cash? What is its Ticker Symbol?
Bitcoin Cash has originated as a result of a hard fork of the Bitcoin blockchain ledger on August 1, 2017.
As like Bitcoins, Bitcoin Cash is a cryptocurrency which can be transacted between two different users without the need for the third party such as centralized banks. Bitcoin Cash transactions are recorded in a shared distributed ledger (Blockchain) which is maintained by computer nodes in a decentralized P2P network. The ticker symbol for BitcoinCash is BCH.
What is the difference between Bitcoin (BTC) and Bitcoin Cash (BCH)?
As mentioned in earlier sections, Bitcoin and Bitcoin Cash are both a kind of cryptocurrency which can be transacted between two users without the need for the centralized bank and whose transactions records are maintained in a blockchain. However, Bitcoin and Bitcoin Cash are different.
The following are some of the key differences:
- Transactions for both BTC and BCH are maintained in different blockchains.
- As on the day of the hard fork on August 1, 2017, a person having X number/amount of Bitcoin would have got the same number of Bitcoin Cash. For example, let’s say Charlie has 2.345 BTC before the fork happened. After the fork happened, the following would happen:
- Charlie would have 2.345 BTC and the same number of Bitcoin Cash (BCH) which is 2.345 BCH.
- Any person starting to transact on Bitcoin blockchain would only have/own bitcoins and no Bitcoin Cash. In the same way, any person starting to transact on Bitcoin Cash blockchain would only have/own BitcoinCash and no Bitcoins. This is primarily because both cryptocurrency and related transactions are maintained on a different shared distributed ledger (Blockchain).
- After the fork (post 1st August 2017), transactions made on Bitcoin blockchain and Bitcoin Cash are separate/different. Thus, if Charlie earned 0.025 BTC and 0.015 BCH, the total value of BTC and BCH he owns up is (2.345 + 0.025) BTC and (2.345 + 0.015) BCH which is equal to 2.37 BTC and 2.36 BCH.
- Bitcoin Cash transactions use a new signature hashing algorithm indicated by the flag SIGHASH_FORKID. These signatures are not valid on the Bitcoin network.
- BitcoinCash is maintained by decentralized development teams, unlike Bitcoin which was maintained by a single team.
Cryptocurrency Exchanges where BTC and BCH are traded
Those maintaining Bitcoins happened to be supporting BitcoinCash as it is created as an offshoot of Bitcoin Blockchain. Here is the list of popular cryptocurrency exchanges supporting BitcoinCash.
In this post, you learnt about some of the following:
- How did Bitcoin Cash (BCH) came into existence?
- What are differences between Bitcoins (BTC) and Bitcoin Cash (BCH)?
Did you find this article useful? Do you have any questions about this article or suggestions regarding differences between Bitcoin (BTC) and Bitcoin Cash (BCH)? Leave a comment and ask your questions and I shall do my best to address your queries.