What Is Bitcoin Cash (BCH)?
What Is Bitcoin Cash (BCH)?
Bitcoin Cash (BCH) is a decentralized digital currency that emerged in August 2017 as a result of a hard fork from Bitcoin (BTC). The split occurred due to growing concerns in the Bitcoin community about the cryptocurrency’s ability to scale and handle an increasing volume of transactions. The developers behind Bitcoin Cash believed that Bitcoin had strayed from its original purpose of being "peer-to-peer electronic cash" and instead had become more of a store of value, often referred to as "digital gold."
To address these concerns, Bitcoin Cash was created with one key modification: it increased the block size limit from 1 MB to 8 MB at launch and later to 32 MB. This change allows more transactions to be processed per block, enabling faster and cheaper transactions. As a result, Bitcoin Cash aims to be a more practical and scalable payment system suitable for everyday use everything from buying coffee to sending money across borders.
In essence, Bitcoin Cash retains many of the core features of Bitcoin—such as decentralization, cryptographic security, and a fixed supply of 21 million coins—but with enhancements aimed at improving its usability as a medium of exchange.
How Does Bitcoin Cash Work?
Bitcoin Cash operates on a blockchain, which is a public ledger that records every transaction made on its network. This ledger is maintained by a network of computers (called nodes) that validate and verify transactions through a process called mining. Like Bitcoin, Bitcoin Cash uses a consensus mechanism known as Proof of Work (PoW), where miners solve complex mathematical problems to validate blocks and add them to the blockchain.
The primary difference between Bitcoin and Bitcoin Cash lies in the block size. With larger blocks, Bitcoin Cash can handle more transactions per second compared to Bitcoin. This significantly reduces transaction congestion and results in lower fees, making BCH a more appealing option for day-to-day transactions and micro-payments.
Another technical feature worth noting is the adjustable difficulty algorithm used by Bitcoin Cash. This algorithm helps maintain block production times even when there are changes in the number of miners on the network. It ensures the stability and consistency of the blockchain, especially in times of high or low mining activity.
Bitcoin Cash wallets function similarly to Bitcoin wallets. Users are assigned a pair of cryptographic keys: a public key (used to receive funds) and a private key (used to access and send funds). These wallets can be online, mobile, desktop, or hardware-based, depending on user preferences and security needs.
What Are Important Features of Bitcoin Cash?
One of the standout features of Bitcoin Cash is its focus on speed and low fees. Here’s a breakdown of some of the core characteristics that define the BCH network:
- Larger Block Size: The original reason for creating Bitcoin Cash was to increase the block size limit. A larger block can accommodate more transactions, reducing the need for users to compete for limited space and pay higher fees.
- Lower Transaction Fees: Because of the larger blocks and more efficient processing, BCH typically offers lower transaction costs than Bitcoin. This makes it ideal for microtransactions and frequent transfers.
- Faster Transaction Confirmations: Bitcoin Cash transactions are confirmed more quickly than those on the Bitcoin network, especially during times of high network traffic. Users don’t have to wait long for their transactions to be verified.
- Decentralized Network: Like Bitcoin, BCH is fully decentralized and operates without a central authority. Its community-driven development ensures that no single entity controls the network.
- Fixed Supply: Bitcoin Cash has a maximum supply of 21 million coins, similar to Bitcoin. This limited supply makes it deflationary and potentially valuable over time as demand increases.
- Smart Contract Capabilities: Bitcoin Cash also supports smart contracts through CashScript, enabling developers to create decentralized applications (dApps) on the BCH network.
Bitcoin Cash vs Bitcoin: What’s the Difference?
Although Bitcoin and Bitcoin Cash share the same genesis and much of the same codebase, their goals and technical differences have caused them to diverge significantly.
Bitcoin has evolved primarily into a store of value—a kind of digital gold. It is used more for long-term investment rather than everyday transactions. Due to its smaller block size and increasing demand, Bitcoin often suffers from higher transaction fees and longer confirmation times, especially during periods of high usage.
In contrast, Bitcoin Cash was developed with the express purpose of being a usable currency. It processes transactions faster and more cheaply, making it more aligned with the original vision outlined in Satoshi Nakamoto’s whitepaper. While Bitcoin is preferred by investors and institutions, BCH is favored by users who want to make everyday payments quickly and affordably.
This divergence in philosophy has led to different levels of adoption. Bitcoin is more widely accepted and recognized, while Bitcoin Cash is still working to establish itself as a popular payment alternative. Nevertheless, BCH continues to gain traction among merchants, developers, and users who value efficiency and scalability.
How to Buy BCH?
Purchasing Bitcoin Cash is relatively simple, especially with the growing number of cryptocurrency exchanges that support BCH. One recommended platform is Ourbit Exchange, which allows you to trade BCH against USDT and other cryptocurrencies.
To buy BCH on Ourbit:
- Visit Ourbit Exchange and sign up for an account.
- Complete your identity verification (KYC) as required.
- Deposit funds into your account using USDT or other cryptocurrencies.
- Search for the BCH/USDT trading pair.
- Enter the amount of BCH you want to buy and execute your trade.
Using reputable exchanges ensures that your transactions are secure and that you get fair market rates. Always enable two-factor authentication and follow best practices for online security.
BCH FAQ
1. Is BCH coin a good investment?
Whether or not BCH is a good investment depends on your financial goals and risk tolerance. BCH offers strong potential as a payment-focused cryptocurrency, especially due to its speed and low fees. However, like all cryptocurrencies, it is subject to market volatility. Investors should conduct thorough research and consider diversification when building a portfolio.
2. What is BCH used for?
Bitcoin Cash is primarily used for peer-to-peer payments, e-commerce purchases, remittances, and other financial transactions. Some merchants accept BCH as a payment method both online and in-store. Its fast transaction speeds and low fees also make it suitable for tipping, donations, and cross-border transfers.
3. What’s the future of BCH?
The future of Bitcoin Cash depends on broader adoption, continued innovation, and its ability to differentiate itself from other cryptocurrencies. If BCH continues to be embraced by merchants, developers, and users who value speed and low costs, it could carve out a strong niche in the cryptocurrency ecosystem. Upcoming upgrades, strategic partnerships, and increased real-world use cases will likely influence its long-term success.
Disclaimer: The information provided herein is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are risky; conduct your own research before investing.
