A year ago, Bitcoin Cash (BCH) was born after a hard fork by Bitcoin's blockchain.
It has been an interesting 12 months since the fork gave birth to BCH, as proponents continually discussed the merits between Bitcoin (BTC) and BCH. However, on the anniversary of the creation of Bitcoin Cash, it is worth revisiting what caused the existence of this altcoin and what it aimed to do.
How We Got Here
Since its creation in 2009, the Bitcoin-based user has grown steadily during the better part of a decade. In the last three years, this has caused some "growing pains", since the original parameters that govern the blockchain have led to problems with speed and transaction costs.
In the Bitcoin white paper, its creator, Satoshi Nakamoto, has technical details for a "peer-to-peer electronic payment system" that would allow people to make transactions without the need for a central authority.
While you can read Cointelegraph's guide to Bitcoin here, the preeminent cryptocurrency is managed by a network of computers that validate and share a ledger of ongoing transactions that requires hash-based job testing algorithms to prevent double spes
. These transactions are validated and then stored in blocks by miners. Each block is limited to containing 1 MB of data before being added to the blockchain. When a miner unlocks a block, a certain amount of Bitcoin is created.
Here's where scaling has recently become a problem. As more people started using Bitcoin, there was a spike in the amount of transactions. The network became congested due to the volume that had to be validated, which caused an increase in transaction fees. In other words, it was becoming slower and more expensive to use Bitcoin for transactions.
As shown in the following chart, taxes have gradually increased in 2017:
to the wider Bitcoin community – consisting of vast mining pools, wallets and suppliers of exchange services and developers – to discuss ways to address these problems.
This gave rise to what is known as Segregate Witness (SegWit), a soft fork in the Bitcoin Protocol that originally seemed to solve the malleability of transactions. However, it was proposed that SegWit include an update in blocks of sizes from 1 MB to 2 MB, and this is where the community has reached a crossroads.
The SegWit was finally implemented – unless we increase the size – but some members of the community pushed for a difficult fork that would also implement the change in size.
Bitcoin Cash was born by courtesy of a fork on August 1, 2017. The Bitcoin community celebrated the launch of SegWit on August 24th.
The launch of Bitcoin Cash has been a very controversial topic among the cryptocurrency community for a number of reasons.
As mentioned earlier, some community members had died on SegWit including an increase in block size to provide more capacity for transactions on each block.
When it became clear that SegWit would go on without this change, a group of miners designed the hard fork, which would have seen a series of changes to the protocol – including an increase from 1 MB for block to 8 MB.
Vice President of Business Operations at BTC.com, Alejandro de la Torre told Cointelegraph about the importance of bifurcation:
"The ability to build forks keeping the community aligned has been a great achievement. bandwidth per block increasing first to 8MB and then again to 32MB This extra room is more than needed at this time, but BCH seems to look ahead and prepare to process high volumes of traffic. in addition to BCH to store more information in each transaction, giving the blockchain space the ability to write intelligent low-cost chain contracts. "
As a blocking of Bitcoin's blockchain, Bitcoin users would receive an equal number of Bitcoins Cash at the time of the fork
The Chinese mining producer Bitmain was an original proponent who suggested the Bitcoin cash fork in 2017, but later clarified the move as a contingency plan for a soft fork. Amaury Séchet is credited with the first announcement of Bitcoin Cash, originally known as Bitcoin ABC.
Bitcoin vs. Bitcoin Cash
Since then, Roger Ver has probably been the biggest promoter of Bitcoin Cash. His initial support to BCH in 2017 was met with skepticism, partly due to his involvement in a previous fork, Bitcoin Unlimited (BU).
Ver strongly supported the BU and, at some point, even claimed that it would sell its BTC holdings in favor of the forked currency. However, once Bitcoin Cash was launched, the owner of Bitcoin.com seemed to jump on the bandwagon.
Since then, Ver has apparently pushed an anti-BTC program, beginning with the claims that Bitcoin Cash is the "true Bitcoin" in November 2017.
Regarding the ideological battle between BTC and BCH, De La Torre suggests that the fervor between the different fields highlights the trust that people have in the two cryptocurrencies:
"Both cryptocurrencies have clear advantages that attract users according to different interests and cases of use. exclusive, but more like complementary currencies.BCH was created to immediately preserve the status of Bitcoin as an electronic cash-point system and its focus remained on this goal. "
Bitcoin.com also suffered pressures from the community cryptocurrency, with a group pushing a lawsuit against the website for the use of misleading language and information.
Image source: Bitcoin.com
The Twitter handle @ Bitcoin was temporarily suspended in April from the social media platform after numerous complaints on the tweets that promote BCH – flaring the argument between BTC and BCH supporters.
Shapeshift CEO Erik Voorhees went so far as to tell Ver publicly on Twitter in April to refrain from binding him to his opinion that BCH is Bitcoin.
Roger – please stop referring me to support your opinion that Bitcoin Cash is Bitcoin. It is not. Bitcoin is the chain originated from the genesis block with the highest evidence of accumulated work. The Bitcoin Cash fork has not managed to get the majority, so it's not Bitcoin.
– Erik Voorhees (@ErikVoorhees) 27 April 2018
The owner of the Galaxy Digital Michael Novogratz also took a picture of the Twitter @Bitcoin for his tweets promoting BCH in May.
I already have enough. Bitcoin's core is BTC. It is a value shop. It is digital gold. It is a cash market with bitcoin dwarfs. If you want to be a payment currency by definition, you must have a stable value. So, why own it. ??
– Michael Novogratz (@novogratz) 5 May 2018
Bitcoin Cash – by numbers
While the BTC against the BCH debate that rages endlessly in sight, Bitcoin Liquidity has established itself as one of stronger cryptocurrencies in terms of market value.
The competition from BTC and BCH, De La Torre believes, is a vital part of the continued development of the cryptocurrency ecosystem.
cryptocurrency as a digital currency is what will push the entire industry forward. #HODL has been a call for many in the community of cryptocurrencies, but I hope the call to #BUIDL (creating blockchain solutions and decentralized activities) stimulates the sustainable and practical use of Bitcoin and BCH at the same way, building a new era of peers Financial sovereignty open to all is accessible to all. "
According to data from Coinmarketcap, BCH is currently ranked fourth in terms of market capitalization, with over $ 13 billion, but BTC still holds a whopping 47% of the total cryptographic market cap.
BTC.com it was one of the first portfolios to provide BCH support, which gave the platform some unique insights into the development of altcoin.In its short year of existence, De La Torre has emphasized its adoption by various services and exchanges. :
"One of the most interesting metrics are applications: BCH has expanded 19 different services – for example, Bitpay, Coingate, Viabtc, Coinpayments and Coindance. Bitcoin Cash is also involved in 14 different projects – for example, OpenBazaar, Joystream and Counterparty – and is tradable on 41 different exchanges. "
Despite the controversial birth of BCH in 2017, Bitcoin still holds a dominant position in the cryptocurrency market However, as De La Torre points out, any cryptocurrency that has gained widespread use aims to provide a unique service that is challenging financial world as we know it
The two will continue to be used by people all over the world for different reasons, but the story that led to the emergence of Bitcoin Cash will always be an interesting read.