What is the difference between Bitcoin and Bitcoin Cash? Which side do you prefer to choose in this war of two giants, namely Bitcoin vs Bitcoin Cash?
Scienceloversss - What is the difference between Bitcoin and Bitcoin Cash? Which side do you prefer to choose in this war of two giants, namely Bitcoin vs Bitcoin Cash??
Did you know that Bitcoin Cash comes from Bitcoin itself? That's right - Bitcoin Cash nodes (computers) used to be part of the Bitcoin blockchain. Bitcoin Cash is a fork of Bitcoin, this is one of the real differences between Bitcoin and Bitcoin Cash.
But which of these two giants should you choose to invest in? What's the difference between Bitcoin and Bitcoin Cash? What exactly is a "fork"? There are lots of questions, and I'm here to answer them all!
By the end of this guide, you will thoroughly understand the differences between Bitcoin and Bitcoin Cash which are two separate cryptocurrencies.
You will learn more about their history, values , and potential for the future. After this, you will be able to decide which one you choose to invest in, or even you want to invest in both.
First, let's look a little bit about Bitcoin and its background. Then, I will explain what a fork is. After that, we will take a look at the story behind Bitcoin Cash and its features.
If you are already familiar with Bitcoin and Bitcoin Cash and are only here for a comparison between the various differences between Bitcoin and Bitcoin Cash, skip the section entitled Bitcoin and Bitcoin Cash Differences: The War between the Two Prices!
Bitcoin
Bitcoin was the first cryptocurrency and for many years it was not very well known. Bitcoin is just like any other real currency. You can use it to buy, sell, and trade goods, services, investments, and more.
Blockchain technology that makes it prevent Bitcoins from counterfeiting. It also means it is not owned, excluded, or controlled by any group or party.
For example, US dollars are issued by the US government and controlled by banks. In this scenario, the central parties are the government and the bank. When you transfer dollars to a friend, you rely on the bank to authorize and process the transaction.
Bitcoin, on the other hand, is not issued or controlled by any central authority. Transactions on the blockchain are verified by the computers running the blockchain, and all these computers can be owned by anyone - blockchain is decentralized.
In the blockchain, transactions are stored and transmitted in the form of blocks. All these computers verify all blocks of transactions at once by solving complex math problems. When this problem is solved, all transactions in the block are verified and new Bitcoins are created - these Bitcoins are then given to the computer that solved the problem. This process is called mining or mining!
The total number of Bitcoins that have been and will be created is limited to 21 million. Even though there are already over 16 million Bitcoins, it will take a long time until the number of Bitcoins created reaches 21 million! This is because every 4 years, the number of Bitcoins created per block is cut in half.
As more and more people try to acquire Bitcoins as the number of them gets smaller, the belief generally holds that its value will increase. That's why so many people are crazy about Bitcoin now!
Currently, Bitcoin is the most valuable cryptocurrency on the market. While other currencies are trying to outperform Bitcoin and reduce its dominance in the digital coin sector, few have come close to Bitcoin's fame. However, Bitcoin Cash can be an exception due to the differences between Bitcoin and Bitcoin Cash!
Since Bitcoin Cash is a fork of Bitcoin, I will explain what a fork is before I explain Bitcoin Cash!
Fork
There are several Bitcoin forks, but none are as used or well-known as Bitcoin Cash. A fork is formed when the original blockchain code is updated (or updated) but only part of the nodes (computers) in the blockchain agree to the update.
The original blockchain (such as Bitcoin) remains the same, and the updated nodes separate from the original blockchain and create a new blockchain (such as Bitcoin Cash) and the coins on the blockchain are separate and unique from those on the original blockchain.
Anyone holding the original coin at the time of the fork will automatically get the forked version of the coin they were holding. So, when Bitcoin forks into Bitcoin Cash, someone who owns 10 BTC will automatically receive an amount of BCH that is equivalent to their 10 BTC worth.
Alright, now let's talk about Bitcoin Cash itself!
Bitcoin Cash
Just like Bitcoin, Bitcoin Cash is a cryptocurrency that has its own blockchain. It works like a digital currency and new BCH (Bitcoin Cash) is created through BCH mining or BCH mining. It was created in late 2016, which makes it much younger than Bitcoin.
Bitcoin was branched out to create Bitcoin Cash because the Bitcoin developers wanted to make some important changes to Bitcoin. The developers of the Bitcoin community were unable to come to an agreement on some of the changes they wanted to make. So, this small group of developers formed an offshoot of Bitcoin to create a new version of the same code with some modifications.
The changes that make all the difference between Bitcoin and Bitcoin Cash are as follows:
- Bitcoin Cash has cheaper transfer fees (around $0.20 per transaction), so transacting on BCH will save you more money than using BTC. BTC transactions can cost around $1 USD per transaction, although it has previously gone up to around $25 per transaction!
- BCH has a faster transfer time. So, you don't have to wait 10 minutes to get Bitcoin transaction verification!
- BCH can handle more transactions per second. This means that more people can use BCH for the same length of time as compared to BTC.
All these changes are due to the fact that Bitcoin Cash blocks (in the blockchain) are eight times larger than Bitcoin blocks. This difference between Bitcoin and Bitcoin Cash makes BCH faster, cheaper, and more scalable than Bitcoin. Bitcoin Cash is becoming more and more adopted day by day because of this.
Bitcoin and Bitcoin Cash Differences: A War Between Two Prices
As previously mentioned, cryptocurrencies like Bitcoin or Bitcoin Cash derive their value from how much they are adopted, used, and demanded. We can analyze it in terms of ROI (Return on Investment) and value growth.
They are both value holders, and while Bitcoin has been the biggest value holder to date, Bitcoin Cash continues to gain users and value rapidly.
Bitcoin Cash is less than a year old. So, it is still in the stage of capturing and realizing its own place in the crypto market. Many people have speculated that Bitcoin Cash might take a sizable share of Bitcoin's market share, making it the new dominant cryptocurrency in the industry. This is because Bitcoin Cash has overcome the scaling problems Bitcoin faces, allowing more people to use it easily and at a lower cost.
If the Bitcoin developer community doesn't find a way to agree on a mutual update to the Bitcoin code to solve the problem, Bitcoin may lose the Bitcoin vs Bitcoin Cash war. This means that more people are likely to switch to using BCH as their primary store of value and transactional currency.
In the recent past, Bitcoin Cash has been valued as low as 5% of Bitcoin, to as high as 33%. It is currently in the 10-15% range of the Bitcoin price. Below is a graph of Bitcoin vs Bitcoin Cash prices over the last nine months.
(Orange line is BCH to BTC)
One of the things holding back BCH's rapid growth is the confusion people have about the difference between Bitcoin and Bitcoin Cash. Many novice investors see Bitcoin Cash as a cheaper Bitcoin with a lower entry point into the market. This is because they have very similar names and come from the same community and brand.
This confusion over the differences between Bitcoin and Bitcoin Cash has also caused Bitcoin Cash to receive negative attention as a copycat currency that is simply a cash grab, aiming to trick new crypto investors into buying fake Bitcoins. However, this is not true.
BCH is not fake Bitcoin, but rather something that might be better.
Difference between Bitcoin and Bitcoin Cash: Features
Bitcoin Cash Benefits
The main advantage of Bitcoin Cash is that it is cheaper and faster to use. This is because it is more scalable, meaning more people can transact on the blockchain at any time.
Its development team is quick to implement solutions that make the blockchain more scalable. This provides great potential in the future for adoption and use.
One more difference between Bitcoin and Bitcoin Cash is that BCH is cheaper to switch between exchanges. Whenever the price spikes, it is a great trading asset or trading against Bitcoin and is also a solid investment to hedge Bitcoin, should Bitcoin lose its market dominance one day?
Note: There is no financial advice in this article! You should always consult a financial advisor before making an investment.
Bitcoin Cash Losses
Another difference between Bitcoin and Bitcoin Cash is that Bitcoin Cash does not have as much investor confidence as Bitcoin. In addition, the adoption and market penetration rates are much lower than Bitcoin. This has a lot to do with the fact that Bitcoin Cash is much younger than Bitcoin.
In terms of price, the difference between Bitcoin and Bitcoin Cash is that although the BCH price is around 10-15% of the Bitcoin price, the cost of BCH mining is relatively the same as Bitcoin mining. This means that someone who does BCH mining makes 50-60% less profit than someone who mines Bitcoin with the same device. For this reason, miners cannot be so fast in mining Bitcoin Cash.
Lastly, in terms of trading, BCH has significantly fewer trading pairs than BTC, making it less tradable than Bitcoin. All of these disadvantages serve to make the adoption rate and price of Bitcoin Cash much lower than Bitcoin.
Advantages of Bitcoin over Bitcoin Cash
As the original cryptocurrency, Bitcoin is the base currency of the entire sector. It is what all other cryptocurrencies (as well as ETH, most of the time) is traded against and can be traded on most exchanges. Bitcoin is the most popular and has the most trading pairs with other cryptocurrencies.
As of March 23, 2018, Bitcoin made up 44.5% of all crypto sector capital and is considered the Gold standard of a fast-growing industry.
The difference between Bitcoin and Bitcoin Cash is that Bitcoin has a much larger community than Bitcoin Cash and its followers are like a cult: Bitcoin is the first cryptocurrency that people hear about. It's very, very popular - if your Grandma knows about a cryptocurrency, I'll give you $100, it's Bitcoin!
Loss of Bitcoin more than Bitcoin Cash
Bitcoin's disadvantage, when compared to Bitcoin Cash, is mostly related to the scalability issues that Bitcoin faces. Bitcoin is older, slower, and costs more per transaction. It is very likely that as the sector grows, Bitcoin will continue to lose its dominance over these other coins.
Another disadvantage that sets Bitcoin and Bitcoin Cash apart is that Bitcoin's core development team is not as strong as other crypto teams, like Ether's, for example. The Bitcoin team appears to be tenuous as a group and lacks clear leadership.
This makes implementing scalability solutions more difficult to agree on and implement into the network - this is not good at all!
Difference between Bitcoin and Bitcoin Cash: Where Can You Buy It?
One of the most popular exchanges for buying Bitcoin and Bitcoin Cash is Coinbase.
On this platform, you can use fiat money to buy popular cryptocurrencies (including Bitcoin and Bitcoin Cash) via credit cards, bank accounts, and more. Unfortunately, Coinbase is only available in 32 countries:
USA, Canada, UK, Switzerland, Sweden, Spain, Slovenia, San Marino, Portugal, Poland, Norway, Netherlands, Monaco, Malta, Liechtenstein, Latvia, Jersey, Italy, Ireland, Hungary, Greece, Finland, Denmark, Czech Republic, Cyprus, Croatia, Bulgaria, Belgium, Austria, Australia and Singapore.
If you are not in one of these countries and you want to buy Bitcoin Cash or Bitcoin, you can try another broker exchange like CoinMama or CEX.io.
If you use a broker that doesn't sell BCH but sells BTC, you can always buy Bitcoin and exchange it for Bitcoin Cash on a trading platform like Binance.
Another option for buying these coins for cash is to do so on a P2P exchange (Peer-2-Peer; meaning between peers), such as LocalBitcoins. Again, you can only buy Bitcoin on P2P exchanges, but you can trade your BTC for BCH using the trading exchange afterward.
Difference between Bitcoin and Bitcoin Cash: Conclusion
Many people are under the impression that Bitcoin vs Bitcoin Cash is really at war, and that one has to be better than the other. For practical reasons, Bitcoin Cash is a faster and cheaper asset to use for transacting on the blockchain.
But Bitcoin, as the original cryptocurrency, is the most widely adopted store of value and for now the largest in the crypto market. This leads me to believe that these two coins can continue to serve as staples in this industry which is in its infancy and maturity.
BCH can become the main tool for transactions and moving money as more users adopt it. BTC can continue to be used as a store of value which is considered the gold of digital currencies. Both stand to grow in value and adoption over time, making them worthy investments for any investor to look at and consider.
Now that you know the difference between these two coins, you can better decide how you want to invest in them and how you will use them.
For example, you can invest in Bitcoin Cash to use it as your primary form of currency for transactions. However, you can invest in Bitcoin just like you would invest in gold - for the benefit of the investment.
The question is, which option do you want? And for what? Do you prefer Bitcoin as an investment but Bitcoin Cash as a coin to use? What do you think about Bitcoin Cash vs Bitcoin? Let me find out!
Important note: Always do further research, be independent and always consult financial investors before investing.
