Questions have been mounting around Bitcoin’s ability to scale effectively since its inception. As a cryptocurrency, Bitcoin only exists due to its revolutionary blockchain technology which creates a self-contained giant ledger keeping track of all transactions with 100% accuracy and without a third party. In the cryptocurrency economy, Bitcoin Cash has become a highly sought-after digital currency over the past few months and seems to be gaining support and momentum all the time.
Many people have used the peer-to-peer trading platform Shapeshift to trade Bitcoin (BTC) for Bitcoin Cash (BCH). In the recent past, the Bitcoin Cashnetwork has managed to accumulate a massive amount of support and infrastructure.
FEATURES OF BITCOIN CASH
- Bitcoin Cash has a much larger block size (8MB) than Bitcoin.
- Bitcoin Cash has a different transaction signature as well as wipeout and replay protection.
- If the hash rate is low, Bitcoin Cash can quickly adjust the difficulty of its proof-of-work.
- Bitcoin Cash network fees are cheaper than those of most other blockchain networks.
- Moreover, the BCH network fees seem to be consistent, and they may remain low when the network upgrades to a 32MB block size. Hence, there will be plenty of room for cheap transactions.
- There is no need for BCH network users to rely on privacy-invasive techniques like transaction batching.
ISSUES WITH BITCOIN’S TECHNOLOGY
Compared to banks and credit card transactions, Bitcoin’s technology is said to be very slow, as it can process only seven transactions each second. Over 150 million transactions are handled by Visa every day, which is roughly equivalent to 1,700 transactions per second.
Bitcoin needs to scale and increase the speed of its transaction verification process, which is considered a central problem. There’s a solution to this problem. Either the amount of data verified in each block should be made smaller, or the blocks of data should be made larger. Transactions would thus be made cheaper and faster, and more transactions would be processed at one time.
DIFFERING TRANSACTION FEES
Bitcoin’s transaction capacity is limited by its high fees, as a user’s transaction won’t be processed until he or she pays for it to go through. Otherwise, the transaction may get stuck for months, which is nothing short of frustrating for all parties involved.
In the case of Bitcoin Cash, this unbearable situation is not present. There’s plenty of space in the blocks, which assures that transaction fees are always low and there’s no chance of users’ digital assets being in limbo for long periods of time.
Bitcoin Cash has a long way to go before overtaking Bitcoin, but it’s well on its way. When and if it ever does, it will likely lose its stigma as a fork and be considered the real Bitcoin. Perhaps one day it might even be referred to as just cash.
Photo via Pixabay.