Pros and Cons to Bitcoin’s First Hard Fork Creation
Bitcoin Cash (BCH or Bcash) is a fork of the original Bitcoin cryptocurrency that aimed to iron out issues that Bitcoin faced, such as scalability. In Bitcoin’s less notorious days, a blocksize limit was put in place to prevent spam attacks on the network – this became an obstacle for transaction processing, causing delays that could last days. Bitcoin Cash made this blocksize limit adjustable: whilst Bitcoin was limited to 1MB (250, 000 transactions per day), BCH had an increased limit of 8MB, allowing for 2 million transactions per day. By picking a side on this progress-halting debate of whether to increase the blocksize limit, they gathered core support from the side that believed that an increase was vital to the envisaged fluidity of trade. They also pride themselves on low transaction fees, improvements in wallet security, replay protection and protection from hashrate fluctuations.
Bitcoin Cash was the result of a ‘hard fork’ where Bitcoin split into two. More accurate is that Bitcoin was ‘copied’ and the changes were made on the copied version.
People who owned Bitcoin before the hard fork in August 2017 were automatically rewarded an equal amount of Bcash. As of writing this, Bcash is worth about 1/10 of one Bitcoin.
While BCH is very fast and possesses far less transaction fees, many say it offers no real upgrade to Bitcoin because not as many people are using it. If BCH was used as often as BTC, then the transaction fees would be much more similar to Bitcoin (core).
Bcash’s Popularity Over Time
Since its creation, Bitcoin Cash has soared in popularity, with the number of blocks mined for BCH overtaking Bitcoin at times. It gathered support from the bitcoin supporters who believed in a less restrictive trading system, and has become widely accepted by numerous currency exchanges such as Coinbase and Kraken, amongst a myriad of others. It has become an adequate substitute for Bitcoin, with it being mined through the same method, but without the hassle of major transaction delays.
Should you invest in Bitcoin Cash?
In principle, Bitcoin Cash is a natural successor to Bitcoin, having ironed out the wrinkles of a cryptocurrency that is impervious to improvement due to communal indecision, and staying true to the reason Bitcoin was created: the unrestricted trade of electronic cash amongst peers.
However, for serious and casual investors, there is, as with every cryptocurrency, major risk. The price (USD) has been shaky for Bitcoin Cash, with the value dropping from its peak of $4091 on the 20th December 2017 down to $1,518 on 17th January 2018. With value fluctuating so severely, it is difficult to say with any guarantee that this is a wise currency to invest in. Short-term profits could be possible if purchases are made tactically to gain from the fluctuations. However, if you truly believe in the cause behind Bitcoin Cash, then you shouldn’t rule out investing to support its future. There is every chance that the cryptocurrency could soar above its current peak due to its increased functionality. Just keep in mind, as BCH’s popularity (and thus value) increases, so will the transfer times and fees.