The number of people actively investing in cryptocurrency has increased drastically over the past few years. This happened for several reasons, including the advancement of the existing crypto assets.
In the past few years, the market has witnessed numerous new digital asset launches, and one among them was Bitcoin Cash. Bitcoin Cash came to light in the year 2017 and is often confused with Bitcoin.
Bitcoin was the first cryptocurrency, which provided a head start for the development of the cryptocurrency market we witness today. Bitcoin, or BTC, is ranked as the most popular cryptocurrency and holds an impressive market share.
So, are Bitcoin and Bitcoin Cash the same?
The answer is “no.
Even though Bitcoin and Bitcoin Cash are two different cryptocurrencies, they share a lot of things in common. Because of the similarity in the names of these two, investors, especially novice traders, mistake them for the same.
Let’s see the difference, pros and cons, and similarities between these two bitcoins.
What is bitcoin cash?
The same blockchain that hosts the Bitcoin network serves as the foundation for Bitcoin Cash, or BCH for short. A hard fork of the Bitcoin blockchain on August 1, 2017, brought the coin to the cryptocurrency market. Despite having different uses, bitcoin and bitcoin cash have the same origins. Bitcoin Cash was developed in order to alleviate the most prevalent issues faced by Bitcoin users, such as the meager number of transactions per second.
Bitcoin Cash is widely acknowledged as a more affordable and quick payment option. In a short amount of time, Bitcoin Cash has multiplied and is currently listed among the top 30 coins in the cryptocurrency market. You can easily buy Bitcoin cash through a digital exchange platform.
How does Bitcoin Cash work?
- The number of transactions possible for Bitcoin is only seven per second as the megabyte is limited to 1. But for Bitcoin Cash, around 100 transactions per second are possible as they have expanded the block size from 8 MB to 32 MB. Despite the block size and transaction speed, Bitcoin Cash works very similarly to Bitcoin.
- Miners confirm transactions by solving complex mathematical equations using cryptography. By doing so, miners receive rewards in the form of Bitcoin cash tokens; users can trade these with other users.
- Similar to Bitcoin, Bitcoin Cash has 21 million tokens currently in circulation.
Benefits of Bitcoin Cash
- The transaction cost of Bitcoin cash is negligible and is equal to or less than one US penny.
- Bitcoin cash has the potential to carry out almost 100 transactions per second.
- Bitcoin Cash is much more scalable than Bitcoin. The Bitcoin Cash ledger permits a blockchain that supports increased scalability. This reduces the fees demanded from the users, making it a better transactive asset.
- There are numerous cryptocurrencies available on the market, but the majority are not easily available. But for Bitcoin cash, the case is totally different. These can be bought through most major exchanges.
Drawbacks of Bitcoin Cash
- Because relatively less mining power is needed, Bitcoin Cash has a low transaction cost and a speedy transaction. As a result, the system’s security has been compromised and is inferior to that provided by the Bitcoin system.
- Since it has never had to deal with any form of branding issues, Bitcoin is always the winner when it comes to branding. This makes it challenging for Bitcoin Cash to tell them apart, especially given that they have similar names.
- Users of Bitcoin Cash use computers to solve challenging issues in a proof-of-work mechanism to validate and process transactions. This damages the environment and consumes a tremendous amount of energy.
Final thoughts
Both bitcoin and bitcoin cash have distinct advantages and disadvantages. Since the costs are relatively cheap and the transaction speed is decent, experts in the trading industry advise using Bitcoin Cash for making minor transactions. When it comes to long-term investments, Bitcoin is the ideal option due to its enormous market share and high level of popularity. However, it does not follow that you should use Bitcoin. You need to perform thorough research on the cryptocurrency asset you’ve chosen to buy, keeping your needs at the forefront.
