What is Bitcoin Cash and How it Differs from Bitcoin
In the last few weeks, you have probably heard of bitcoin cash, and how it is growing in value as quickly as the original bitcoin. This may have confused you, and left you wondering what is the difference between the two? After all, they all bear the same name, right? Well, you will be surprised to learn that Bitcoin and bitcoin cash are actually two totally different coins, just that they bear the same name. The only thing joining them is the fact that bitcoin cash came from bitcoin, which makes it a more efficient version of bitcoin. To make things clearer, let’s look at what bitcoin cash is, and how it differs from bitcoin.
What is bitcoin Cash?
When bitcoin was first developed, it was designed with a block size of 1 Mb. The idea was to protect the system from spamming. However, as more people took an interest in the system, it began to slow down due to this small block size. That is why the bitcoin community arrived at a consensus to split the code and come up with a new coin, which has a bigger block size of 8mb. That new coin is what is called bitcoin cash.
How does it differ from Bitcoin?
The main difference between bitcoin and bitcoin cash is transactional efficiency. Thanks to its bigger block size, bitcoin cash transactions are faster and can effectively compete with fiat currency transfer methods such as PayPal and Visa. This is unlike bitcoin which has become extremely slow with transactions taking as long as 10 minutes.
Bitcoin cash manipulation controversies
One of the main controversies surrounding bitcoin cash is centralized control, which goes against the whole idea of a decentralized block chain, as envisioned by Satoshi Nakamoto. That’s because a bigger block size gives power to people who have the money to mine on a large scale, using expensive mining equipment. This will only concentrate power in the hands of a few wealthy companies, giving them the power to manipulate the prices of bitcoin cash.
The Coinbase controversy
A few days ago, Coinbase introduced bitcoin cash but was forced to suspend trading due to fears of insider trading. According to the Coinbase CEO, there is a possibility that some employees used their knowledge of the bitcoin cash introduction to profit unfairly from other traders. Due to their activities, the price of bitcoin cash was trading at over $8000 on Coinbase, way higher than the coin’s price on other exchanges. This forced the company to suspend trading in bitcoin cash while it investigates how this happened.
Is Bitcoin cash a viable investment?
The answer is yes! Bitcoin cash is a worthy investment, simply because it is very practical as a currency. Its larger block size makes its transactions faster and cheaper. This will give bitcoin cash the impetus to grow in value in the long run. As for the controversies, they do not in any way affect the functionality of bitcoin cash. This gives bitcoin cash a solid ground to grow in value in the future.