- August 20, 2021
In the world of cryptocurrency, there are a few big names that get thrown around a lot, including Bitcoin. Another cryptocurrency we often hear about is Dogecoin.
You may have heard people talking about something called Bitcoin Cash. And, contrary to what you might think, Bitcoin Cash is not the same as Bitcoin. In fact, there are a few Bitcoin and Bitcoin cash differences that you should know about.
If you’re interested in becoming a cryptocurrency expert, you definitely need to make sure you know the difference between Bitcoin and Bitcoin Cash. Let’s dive into Bitcoin vs Bitcoin Cash and go over what you need to know about these two cryptocurrencies. Keep reading!
What is Bitcoin?
Let’s start by looking at Bitcoin. Bitcoin is a cryptocurrency that was first introduced in 2008 in a whitepaper that its author titled “Bitcoin: A Peer-to-Peer Electronic Cash System”. The mysterious author who published the paper made himself known only as Satoshi Nakamoto.
Satoshi did not make his identity known. In fact, he became an elusive figure who disappeared shortly after publishing his whitepaper. Today, it’s still unknown whether this is an individual or is a group of individuals.
The whitepaper laid out the idea that Bitcoin is an uncontrolled, digital currency that anyone in the world can use. The idea was to create a decentralized currency that could eliminate the need for financial institutions.
It also put a stop to the need for a middle man in transactions, making it possible to verify transactions by using the power of computing. On top of that, the paper made it clear that Bitcoin was a finite resource. Unlike paper money, which governments can print continuously, Bitcoin would eventually run out.
After Satoshi published the paper, Bitcoin still didn’t take off immediately. In fact, it wasn’t until 2009 that there were any recorded transactions using Bitcoin. However, the currency has increased significantly in value since that time. Today, the value of Bitcoin continues to soar, drawing the attention of investors.
What is Bitcoin Cash?
Now that you understand Bitcoin, it’s time to dive into Bitcoin Cash. Bitcoin cash, although it might sound like it’s the same thing as Bitcoin, is actually a little bit different.
The best way to think about Bitcoin Cash is to think about it as a spinoff of Bitcoin that was then turned into its own enterprise. This happens a lot in the stock market. When it happens, the shareholders receive a piece of the new company or receive some other sort of remuneration.
In the world of cryptocurrency, spinoffs are more commonly known as forks. Bitcoin Cash is a fork of Bitcoin that manifested in 2017. Anyone who already owned Bitcoin received the same amount in Bitcoin Cash as compensation.
However, no one was able to buy Bitcoin after August 2017 and receive equal compensation of Bitcoin cash. This helped to keep the integrity of the different cryptocurrencies while still rewarding the original Bitcoin crew.
The fork came about because, in 2017, several developers came up with ideas on improving Bitcoin. The developers couldn’t agree on which changes to the Bitcoin protocol the blockchain network should adopt. So, as a compromise, they formed two groups. The group that split off became what we call Bitcoin Cash today.
Bitcoin Cash took on its own new set of rules. The creators of Bitcoin Cash saw it as a way of exchanging goods and services. The original Bitcoin community chose to view Bitcoin to store value, rather than its own medium.
In the new Bitcoin Cash model, this group increased the block size. That meant that the network could process more transactions and that the currency could begin to grow more quickly.
Understanding Critical Differences In Bitcoin Vs Bitcoin Cash
Now that we’ve clarified the backbone of what Bitcoin is and what Bitcoin Cash is, it’s time to take a look at a few differences. The two modes of cryptocurrency have a few characteristics that set them apart from each other, and understanding both is key to anyone interested in buying or selling either one.
Bitcoin Cash Processes Transactions Faster
One of the key differences between Bitcoin and Bitcoin Cash is the rate at which these currencies process transactions. While both can be used for digital transactions, Bitcoin Cash is a little bit more practical.
That’s because Bitcoin Cash can typically process transactions much faster than Bitcoin can. The reason behind this dates back to the original creation of Bitcoin Cash. Since it was created to be used as a currency rather than simply to store value, it made sense for it to be able to process transactions faster.
To give you an idea of the speed, you should know that Visa can process about 24,000 transactions every second. Bitcoin Cash can process 116 transactions every second. Bitcoin, however, can only process 7 transactions, making it much slower.
Bitcoin Cash Has A Larger Blocksize
Another critical difference between Bitcoin and Bitcoin Cash is the size of the blocks. To enable Bitcoin Cash to process transactions at a faster rate, the block size needed to be larger.
When Bitcoin Cash was created, one of the major differences was that it was given a block size of 8 MB. In contrast, Bitcoin had a block size of only 1 MB.
Since its original creation, both Bitcoin Cash and Bitcoin have been given larger block sizes. Bitcoin Cash now has a block size limit of 32 MB. Bitcoin’s block size still has not increased much.
Bitcoin Is More Widely Accepted
Even though Bitcoin Cash was specifically designed for processing faster, larger volumes of transactions, it’s still not as common as you’d think. In fact, in general, Bitcoin is accepted in far more places than Bitcoin Cash.
On top of that, Bitcoin Cash is not as liquid. That can make it a less popular choice for people who accept cryptocurrency. Because of that, Bitcoin tends to remain more popular than Bitcoin Cash.
It’s also important to note that Bitcoin Cash is still undergoing numerous debates. Even though Bitcoin Cash is, itself, a fork from Bitcoin, there have been other forks from Bitcoin Cash such as Bitcoin Satoshi Vision, or Bitcoin SV.
Bitcoin Cash Does Not Have Transaction Fees
Bitcoin Cash has one major benefit that Bitcoin doesn’t. Bitcoin Cash requires virtually no transaction fees. While transaction fees for cryptocurrencies are always relatively low, the fact that Bitcoin Cash doesn’t involve any fees can make it an appealing payment form.
On the other hand, Bitcoin requires transaction fees that usually hover at around 39 cents. While that won’t necessarily break the bank, it can certainly add up, making Bitcoin Cash an appealing option for people who frequently conduct cryptocurrency transactions.
It’s also important to note that the higher transaction fees required by Bitcoin have been an issue it has faced in the past. This could lead to an eventual loss of value, making Bitcoin Cash the more popular option and the better long-term investment.
Bitcoin Has A More Secure Network
Network security is always a huge question with anything digital. We’ve all heard horror stories of our data being hacked and our privacy being put at risk.
The same is true when it comes to Bitcoin and Bitcoin Cash. While both types of cryptocurrency involve anonymous transactions, the level of security surrounding the transactions is a bit different.
Bitcoin has a much more secure network while Bitcoin Cash is still relatively new. That means that it’s much safer to use Bitcoin to conduct transactions, even though they’ll be processed faster by using Bitcoin Cash.
The Currencies Are Being Adopted At Different Rates
It’s also important to understand adoption rates when looking at different cryptocurrencies. Cryptocurrencies are gaining popularity around the world, but they’re doing so at varying rates.
Bitcoin is used across many major networks and in many countries. In fact, nations such as Japan are beginning to regulate Bitcoin and use it just like any other currency.
In contrast, Bitcoin Cash has only been around for a few years. It hasn’t gained the stability or popularity that Bitcoin has. This means that it may not be adopted as quickly and could be difficult to use.
What Are the Predictions For Bitcoin And Bitcoin Cash?
The good news, whether you’re more interested in Bitcoin or Bitcoin Cash, is that both of these cryptocurrencies are doing fairly well. The projections for both show that they should be increasing in value over the next few years.
New cryptocurrencies are constantly being produced, but with Bitcoin being one of the most well-known currencies, it has a much higher survival rate. On top of that, Bitcoin continues to fork and create new spin-offs, such as Bitcoin Cash.
Both Bitcoin and Bitcoin Cash are still ranking as some of the best cryptocurrency stocks to buy. Both are expected to continue to prosper, which is good news for investors.
You should also know, before investing in either Bitcoin Cash or Bitcoin, that other forks could prosper. Bitcoin Gold and Bitcoin SV are both other forks that were created for different reasons than Bitcoin Cash.
Before committing to an investment, it’s important to look over your portfolio and make sure that you’re making an informed decision. You want to make sure that you have diversified stocks and that you’re making decisions that will help you make money in the long run.
And, since cryptocurrencies’ values are constantly fluctuating, it can be difficult to predict. Looking into your personal strategy will help give you a better idea of the predictions for both of these cryptocurrencies and which to invest in.
Is Bitcoin Or Bitcoin Cash A Better Investment?
Choosing whether to invest in Bitcoin or Bitcoin Cash can be tough. Both offer benefits, and it really depends on what your long-term goals are as well as what your portfolio strategy is.
The first factor you’ll want to consider is the cost of the investment. Bitcoin Cash is much more affordable than Bitcoin. In fact, Bitcoin is worth thousands of dollars while Bitcoin Cash is only worth a few hundred.
For anyone just getting started with cryptocurrency investments, Bitcoin Cash can make a lot more sense and be a lot more accessible. It’s a good starting point for people looking to get into investing in Bitcoin.
However, you also want to think about whether or not you plan to sell your shares well down the line or not. You need to think about how well you expect either Bitcoin or Bitcoin Cash to perform. Think about factors like scalability, processing times, and adoption rates.
Part of investing in cryptocurrency is looking into how well these currencies are being adopted. You also want to look into the type of technology that is being used to mine them. By carefully evaluating your portfolio strategy, you should be able to make a good decision about which is best for you.
Final Thoughts On Bitcoin Vs Bitcoin Cash
Bitcoin and Bitcoin Cash may both be born out of the same idea, but the two are actually fairly different. Having a strong understanding of Bitcoin vs Bitcoin Cash can help you make the right investment choice so that you can better manage your money.
When you’re ready to start investing and get access to your Bitcoin or Bitcoin Cash, Byte Federal is here to help you find cryptocurrency ATMs. Get in touch with us and let’s get you your money at a Bitcoin ATM near you!