According to the Bitcoin Cash website, Bitcoin Cash brings sound money to the world, fulfilling the original promise of Bitcoin as „Peer-to-Peer Electronic Cash”. Merchants and users are empowered with low fees and reliable confirmations. The future shines brightly with unrestricted growth, global adoption, permissionless innovation, and decentralized development.
What is Bitcoin Cash?
Bitcoin Cash (BCH) is an upgraded version of the Bitcoin Core software. It was released on August 1st, 2017. Bitcoin Cash is peer-to-peer electronic cash for the Internet. It is fully decentralized, with no central bank and requires no trusted third parties to operate.
Differences between Bitcoin Cash and Bitcoin
Bitcoin Cash is the continuation of the Bitcoin project as peer-to-peer digital cash. It is a fork of the Bitcoin blockchain ledger, with upgraded consensus rules that allow it to grow and scale.
Anyone who held Bitcoin at the time Bitcoin Cash was created became owners of Bitcoin Cash. This means that Bitcoin holders as of block 478558 (August 1st, 2017) have the same amount of Bitcoin Cash as they had Bitcoin at that time. If your Bitcoins are stored by a third party such as an exchange, then you must inquire with them about your Bitcoin Cash.
Any transactions after the August 1st ledger split are completely separate between Bitcoin and Bitcoin Cash. This means any Bitcoin acquired after the split does not include any Bitcoin Cash, and any Bitcoin Cash does not include any Bitcoin.
Bitcoin Cash differs from Bitcoin Classic in that it increases the block size from 1 MB to 8 MB. It also removes Segregated Witness (SegWit), a proposed code adjustment designed to free up block space by removing certain parts of the transaction.
About transactions
The goal of Bitcoin Cash is to increase the number of transactions that can be processed, and supporters hope that this change will allow Bitcoin Cash to compete with the volume of transactions that PayPal and Visa can handle by increasing the size of blocks.
Bitcoin Cash transactions use a new signature hashing algorithm indicated by the flag SIGHASH_FORKID. These signatures are not valid on the Bitcoin Legacy network. This prevents Bitcoin Cash transactions from being replayed on the Bitcoin blockchain and vice versa.
Why was Bitcoin Cash created?
Bitcoin Cash was created to bring back the essential qualities of money inherent in the original Bitcoin software. Over the years, these qualities were filtered out of Bitcoin Core and progress was stifled by various people, organizations, and companies involved in Bitcoin protocol development. The result is that Bitcoin Core is currently unusable as money due to increasingly high fees per transactions and transfer times taking hours to days. This is all because of the problems created by Bitcoin Core’s blocks being full.
Basically speaking, “blocks” are groupings of new transactions that are added to the blockchain. In Bitcoin, transactions are processed block by block. Bitcoin was designed to target 6 blocks per hour, or one every ten minutes.
Today, the Bitcoin Core network is at maximum capacity and processes approximately 2,500 transactions per block. Bear in mind that to be verified and processed, a bitcoin transaction must be included in a block.