Thursday, July 18, 2019

Bitcoin Cash – A Beginners Guide

 

Bitcoin Cash suddenly announced that they’ll go ahead with a fork on the 1st of August causing a lot of confusion among the cryptocurrency community. This is a brief guide about what Bitcoin Cash is just for the purpose of introducing you to the concept behind it.

What Is Bitcoin Cash?

According to its website, Bitcoin Cash is a peer-to-peer electronic cash for the Internet. It’s fully decentralized, with no central bank and requires no trusted third parties to operate.
This doesn’t seem any different from what the basic premise of Bitcoin itself is but there’s an emphasis on the use of “peer-to-peer electronic cash”. With forking from the original Bitcoin, Bitcoin Cash aims to become a cryptocurrency that has a special focus on transaction capacity.

Bitcoin Cash Logo

Bitcoin Cash Is Different From Bitcoin

Well, Bitcoin Cash is different from Bitcoin because it’s a fork in the Bitcoin Blockchain network which has updated consensus rules which will enable it to grow and scale in a more manageable manner. Bitcoin was able to manage its scaling up until it became popular. With unprecedented growth, it is difficult for the Bitcoin community to simultaneously introduce sufficient Bitcoin Improvement Protocols (BIP).

Bitcoin Cash Is A Fork 

Bitcoin Cash is a fork in the current Bitcoin blockchain network so you will own the same amount of Bitcoin Cash as the Bitcoin at the time of the block forking. It was considered that Bitcoin had finally resolved its scaling issues but the BIP91 was not able to implement changes that everyone would be happy with even though it did manage to increase the transaction capacity of the blocks.

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The legacy Bitcoin code had a limit of 1MB data per block which resulted in 3 transactions per second. Sounds pretty simple but the community on the blockchain community at large was not able to come to a decisive conclusion. That is why a hard fork became a necessity.

What are Bitcoin Cash Features?

Even though Bitcoin Cash is vastly similar to the original Bitcoin, it introduces a few key differences which should be able to address the scaling problems, theoretically speaking. First of all, it offers a much larger block size of 8MB compared to the 1MB previously employed by Bitcoin. Secondly, it offers protection from replay and wipeout since the transaction signature of the block is going to be different from the legacy Bitcoin and it will have a greater block capacity. Lastly, it offers adjustments to the way proof-of-work difficulty works compared to the previous system’s method of adjusting intervals which were there in the previous version.

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Unfortunately, the introduction of Bitcoin Cash does not look like it will be solving any problems with it raising more questions than answering them. It’s highly unlikely that Bitcoin Cash will be worth the same as Bitcoin itself and even if it does gain traction, it will take longer to get there. Another Bitcoin fork is well underway in hopes of addressing the problems that Bitcoin is facing with its scalability going by the name of Bitcoin Improvement Protocols. It is probably going to render the Bitcoin Cash obsolete merely a few months after its introduction.

 

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