9 January 2019 17: 00 & nbspUTC
9 January 2019 at 17: 00 & nbspUTC
According to the official Bitcoin Cash website, it is a P2P electronic money for the Internet, completely decentralized, without a central bank and that does not require trusted third parties to operate.
This is the exact definition of Bitcoin because Bitcoin Cash is the hard bet of Bitcoin. But there are more curious people than Bitcoin Cash Blockchain.
A fork is basically a division of a blockchain into 2 different versions, which can happen to any blockchain, but in particular this Bitcoin fork has happened by disagreeing groups about how bitcoin blockchain should evolve over time.
You can also read: How to buy Bitcoin with cash?
Scalability problems with Blockchain BCH
Since the birth of Bitcion in 2009 by Satoshi Nakamoto, Bitcoin has become increasingly popular to use as a digital currency.
Since the use of the network has been improved, Bitcoin's blockchain has begun to clash with the scaling problems due to the limited number of transactions that can fit into every 1MB Bitcoin block.
A block is a group of transactions packaged together and validated. A new Bitcoin block is processed approximately every 10 minutes.
With a block size of 1M, the Bitcoin blockchain can handle only 7 transactions every second compared to a peak of 56,000 transactions per second per Visa.
A prolonged increase in usage over the years has led to a Bitcoin network where transactions can take much longer to search their way into a block until a high transaction fee is set.
High activity periods can lead to network congestion and a spike in transaction fees that make the blockchain impractical for some use cases such as micropayments.
Well, there are different approaches to the growing number of transactions Bitcoin can support. Each of these approaches leads to different but unique compromises, such as having to balance speed, safety and costs.
Because Bitcoin is not only open but accessible globally, there are several groups that use blockchain technology for different use cases and economically benefit from blockchain in various ways.
While each of these groups has a vested interest in Bitcoin, none of them has the exclusive decision-making ability in the update process.
As a result, a large majority of these parties must meet and agree on any changes to Bitcoin to be enacted.
Not only that, the community has been stuck for years, but recently it has agreed on updates to help Bitcoin as a payment network.
You can also read: 10 differences between Ethereum and Ethereum Classic
The original Bitcoin Cash Blockchain plans to carry forward a plan called SegWit2x which provides for the implementation of SegWit (Secret Witness).
SegWit is essentially a change to the transaction data format that has less storage space than the block size limit.
This update would allow you to add scaling innovations such as Lightning Networks, where transactions can immediately resolve blockchain, which means that not all transactions will have to go through the public ledger.
Another cryptocurrency Litecoin was able to successfully implement SegWit and serve as a testing ground for the potential adoption of Bitcoin.
After a few months, SegWit was implemented, and the block sizes would have increased from 1 MB to 2 MB to allow for the inclusion of multiple transactions in the block.
You can also read: 5 sites to buy Bitcoin with debit card
Bitcoin Cash Blockchain
On 1 August 2017, a Bitcoin hard fork created Bitcoin Cash. The story of both was identical up to the fork.
In case a person checked his or her bitcoin's private keys or had his Bitcoin stored on an exchange that supported Bitcoin Cash, then he would automatically have a 1: 1 equivalent of Bitcoin Cash for his own Bitcoin.
Bitcoin Cash aims to increase the block size immediately from 1 MB to 8 MB without implementing SegWit.
This allows you to include multiple transactions in the network and thus reduce transaction fees.
This allows multiple transactions to be included on the network and therefore to transaction fees that are much lower.
Bitcoin Cash received a mixed reception within the community and not all exchanges included support for it.
Some people believe that Bitcoin Cash will allow rapid scalability of the technology, while others believe that a thick fork of Bitcoin makes confusion to the public unnecessary and damages Bitcoin's reputation as a divided community.
You can also read: 5 things you should know about Blockchain
It is not clear which chain will win in the end or if we end up having two separate chains of Bitcoin and Bitcoin Cash, or ultimately also more than two chains that will evolve differently over time.
A potentially exciting part of this hard fork is that if a group basically does not agree with the ideologies of the original group, then they can split to start their version with the same technology but with a different strategy and a governance model. .
This is something that allows the whole cryptocurrency space to evolve by having a kind of fork hard to try new things.
Regardless of the result of these two chains, we are experiencing very exciting moments in the cryptic community.
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