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Independent British blockchain and crypto news

BITCOIN CASH Our definitive guide to Bitcoin Cash (BCH)

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CONTENTS

WHAT IS BITCOIN CASH? 3When did the chain start? 3Why did the majority of nodes reject the Bitcoin Cash blocks? 3The start of a new blockchain 3Is Bitcoin Cash different to Bitcoin? 4What happened at the time of the fork? 4The first fork 4Only one real Bitcoin 4

HARD FORKS EXPLAINED 5What is a hard fork? 5Disagreements about Bitcoin 6What are non-contentious hard forks? 6

HOW TO GET YOUR HANDS ON BITCOIN CASH 7Buy Bitcoin Cash from an exchange 7Purchase from a Bitcoin Cash ATM 8Earn Bitcoin Cash online 8Buy in person through peer-to-peer trading 8

THE GROWING POPULARITY OF BITCOIN CASH 9Wikipedia has started accepting Bitcoin Cash donations 9Music fans can now buy tickets with Bitcoin Cash at ClashMusic.com 9

THE POTENTIAL FUTURE OF BITCOIN CASH 10Scaling 10Usability 10Extensibility 10

CONCLUSION 11

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Bitcoin Cash was the first major Bitcoin code fork and airdrop. As a result of the forked ledger, everyone holding Bitcoin on the BTC chain had been credited with the equivalent amount of Bitcoin Cash. This happened when its blockchain launched. Today, Bitcoin Cash (BCH) is the fourth largest cryptocurrency, with more than $10 billion in market cap.

When did the chain start?The standalone blockchain for Bitcoin Cash started on the 1st August 2017. On this date, a group of miners moved to produce Proof-of-Work (PoW) and blocks compatible with the protocol implementations for Bitcoin ABC, Bitcoin Unlimited and Bitcoin XT nodes.

These three node protocols stayed in consensus with the new blocks but the majority of nodes under the Bitcoin core protocol rejected the blocks, and mined from these miners.

WHAT IS BITCOIN CASH?Bitcoin Cash, in sort, is a cryptocurrency and payment network. It derives from the original cryptocurrency, Bitcoin, but has many differences.

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Why did the majority of nodes reject the Bitcoin Cash blocks?The Bitcoin Cash blocks had a larger block limit of 8mb. (Current Bitcoin nodes only accepted blocks under 1mb as part of their consensus rules). All other consensus rules on the nodes remained the same. Examples include the rate of blocks (10 mins) or the total supply of coins (21 million).

The start of a new blockchainAt the point the chain split in two, it was the first time you could send transactions of funds that you held in Bitcoin to either the original BTC blockchain and also the new BCH blockchain.

Is Bitcoin Cash different to Bitcoin?Bitcoin Cash today is a 100% independent cryptocurrency; its price is not dependant on that of the original Bitcoin. However, Bitcoin (BTC) is still the most dominant cryptocurrency (with over 50% dominance in market share today).

What happened at the time of the fork?At the exact time of the hard fork we saw battles break out in two specific places: on exchanges for people selling their BTC for BCH (or the other way around), and also in the hashing power to mine blocks for each fork.

The first forkBitcoin Cash will always be known as the first major Bitcoin fork and airdrop. In the months following the fork we had other airdrops launch like Bitcoin Gold, Bitcoin Diamond, Bitcoin Private and Bitcoin Interest all launch.

Only one real BitcoinAccording to Roger Ver, CEO of Bitcoin.com, BCH is the real bitcoin. He claims that the current code implementation of BCH aligns closer to that of Satoshi’s original white paper (published 10 years ago). This viewpoint is also held by Bitmain, who are rumoured to be behind the majority of the hashing power supporting the bitcoin cash network.

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Cryptocurrencies are fundamentally supported by blockchain technology. A blockchain is a form of distributed ledger technology which presents information in blocks of data. When transactions with crypto are made, data miners must solve cryptographic puzzles to determine the correct hash and add a block full of transactions to the blockchain. Successful miners are awarded crypto for their work. A key part of blockchain technology is transparency. To achieve transparency, blockchains are immutable and only verified transactions can be added. To verify a transaction, people within the network must reach consensus about the transaction. If consensus is not reached, or there is a disagreement about the future of a network, then a fork is likely to occur.

What is a hard fork? A hard fork implies that when a change occurs in a blockchain, it will be irreversible. Typically, this is because the changes will not be backwards compatible with older versions of the blockchain. When updates or changes are made to a blockchain, the new version will fork from the original blockchain and there will effectively be two active blockchains – the old original one and the new one that has additional, updated rules. This in turn means any users wishing to stick with the newly forked network must upgrade to the new version. It is worth remembering that forks require a majority consensus from participants in the network. Once implemented, all participants on the network can voluntarily upgrade their software to the new version.

HARD FORKS EXPLAINED Let’s take a look at the basics of hard forks and the difference between ‘contentious’ and ‘non-contentious’ hard forks.

There are two types of forks: contentious and non-contentious.

�� A contentious hard fork will typically occur when there is a disagreement within a community. The two disagreeing factions will fork the chain and implement the changes they desire on their respective chains.

�� A non-contentious hard fork will occur when a fundamental change in the code is required to upgrade the blockchain.

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Disagreements about Bitcoin Bitcoin’s hard fork arose following a dispute over scaling issues. Some believed that scaling could be solved by increasing the block size from 1mb to 8mb, which in turn would decrease fees and allow for more transactions to be completed at the same time. People who opposed this fork believed that it would bring about security issues and increase centralisation because node costs would increase. If node costs increased, those who are richer could begin to dominate the nodes, thereby creating a network which is ran by the wealthy. Those who were in favour of increasing the block size decided to fork Bitcoin, which brought about Bitcoin Cash. Anyone with Bitcoin on the Bitcoin blockchain received the same number of Bitcoin Cash on the Bitcoin Cash network via airdrop.

What are non-contentious hard forks?Bitcoin Cash has had several non-contentious forks, one of which implemented ‘emergency adjustment difficulty’, or EDA for short.EDA will occur if fewer than six blocks have been mined within the last 12 hours. For context, in the original Bitcoin blockchain, if the network is running smoothly, a new block of data should be mined every 10 minutes.

There are also hard forks which seek to implement protocol upgrades. These will likely have been stated on a project’s roadmap since their inception. A planned hard fork looks to upgrade and enhance the blockchain’s capabilities and features. The entire community, spearheaded by the core developers, will transition to the upgraded version of the blockchain. This is because the update will require a change in the fundamental code.

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Buy Bitcoin Cash from an exchangeIf you’re familiar with placing buy and sell orders through stock brokers, you can safely assume cryptocurrency exchanges function in a similar, third-party manner to these brokers. Brokers take your desired cryptocurrency price and order quantity, wait for an order to be completed, and then typically collect a percent commission (plus an upfront fee) on your order.

Similarly, a cryptocurrency exchange is usually programmed to accept your digital buy and sell orders (along with price and quantity), waits in a similar manner for your order to be triggered (met by a buyer or seller on the other end), completes the trade, and then updates your on-exchange holdings, all without human brokers.

Another of the unique aspects of cryptocurrency exchanges is the ability to exchange one cryptocurrency directly with another.

This is something you can’t do with stocks, where you’d need to liquidate shares to fiat money before using those funds to buy new stock shares. Be aware though that you won’t necessarily be able to trade one cryptocurrency with all other cryptocurrencies under the sun.

Bitcoin Cash pairings Bitcoin Cash pairings were available as soon as the fork went live. At the exact time of the hard fork (and split in blockchains) the community saw battles break out on exchanges for people selling their BTC for BCH and the other way round. Many popular exchanges (including Bitfinex and Kraken) announced before the fork that they would start active trading markets for the BTC vs BCH trading pairs. Trading started at close to 7 BCH for 1 BTC but the price quickly collapsed down to around half that at 14 BCH for each BTC. Ever since the fork, Bitcoin Cash has appeared on even more exchanges. Some of these include Binance, Coinbase, and eToro.

HOW TO GET YOUR HANDS ON BITCOIN CASH There are a number of ways to get your hands on Bitcoin Cash. We take a look at some of the options below.

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Purchase from a Bitcoin Cash ATMAnother way to get your hands on Bitcoin Cash is to use a dedicated ATM. These ATMs are available around the world, often in random locations. The main advantages of Bitcoin ATMs appear to be the ease of use and the fact that no KYC is necessary. They can also be useful for those who are looking for a simple and convenient way to purchase a cryptocurrency. You should be aware, however, that the fees for using an ATM can be quite steep. These markups can be anywhere between 10% and 17%.

Earn Bitcoin Cash onlineEarning cryptocurrency online has become a popular trend, especially for those who don’t want to get involved with mining. You’ve probably heard of the old expression ‘time is money.’ This sentiment certainly pertains to the crypto world. By completing tasks or contributing to an ecosystem, you can earn Bitcoin Cash. There are a number of dedicated websites, including honest.cash and memo.cash, that you can use to create earnings.

Buy in person through peer-to-peer tradingIf none of the options above suit you, the main Bitcoin sentiment is still available you to. You can connect with people in your local area through LocalBitcoinCash.org and participate in peer-to-peer trades. Peer-to-peer trading is often preferred as it is private, fair, and marketplaces are often affordable and secure.

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Wikipedia has started accepting Bitcoin Cash donationsThe non-profit foundation that operates Wikipedia has partnered with BitPay to accept Bitcoin and Bitcoin Cash donations. All of the Wikimedia Foundation’s work is driven by its vision to create a world in which everyone can freely share in the sum of all knowledge. The foundation said:

“Accepting payments globally is difficult due to the fractured payments ecosystem and a multitude of payment options.”

By accepting Bitcoin and Bitcoin Cash payments, people can now donate from anywhere in the world cheaply and quickly.

Music fans can now buy tickets with Bitcoin Cash at ClashMusic.comClashMusic.com has decided it

will accept Bitcoin Cash for online transactions, including tickets for concerts.

“With Bitcoin now directly integrated to check out in our online store, we plan to expand acceptance of cryptocurrency into our other consumer-facing services and solutions including ticketing, e-commerce and premium gated content,” says Clash Media Group Managing Director Alex Thompson.

His firm believes Bitcoin Cash is the world’s only digital, low-cost, fast, secure transaction-based currency.

“Average transaction costs on BCH are $0.002 compared with $2 with the segwit Bitcoin and 2-4% of Visa. That’s why pioneering merchants like Virgin Atlantic are happy to accept the burgeoning cryptocurrency as a payment method.”

THE GROWING POPULARITY OF BITCOIN CASHWith so many ways to get your hands on Bitcoin Cash, its popularity has continued to grow. As a result, Bitcoin Cash has been making waves in the news with more exchanges, businesses, and organisations supporting it than ever before. Below, we take a look at some of the most important stories in the news that demonstrate a new found love for Bitcoin Cash.

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The roadmap shows the status of planned and complete development activities under the scaling, usability, and extensibility legs of the Bitcoin ABC protocol.

ScalingThe scaling roadmap includes projects to improve transaction ordering (via scalable block processing) and also a plan to improve block propagation times between nodes and miners. Other planned development activities include Meklix trees and the potentially controversial adjustable block cap, which will target growth up to 1TB blocks. The ABC in the protocol’s name stands for adjustable block caps. Any change to block size will most probably require a hard fork upgrade to the code, which would require a level of consensus between miners and node operators.

UsabilityThe usability roadmap has projects for improved hardware wallet security (with sighash) and also has plans for fee improvements to improve transaction costs for data on the blockchain. The ABC team also think they can break down the lowest unit available on the Bitcoin blockchain (1 Satoshi) by aiming to secure “low fees forever” through fractional satoshis. The overarching usability goal is still to head towards improved confirmation times. The team hope to be able to provide enough trust for merchants to finalise transactions in only three seconds. If they can achieve these times, it will put Bitcoin Cash blockchain confirmations in line with leading merchant payment solutions currently operational throughout the world.

ExtensibilityOne of the goals for the ABC team is to create a fully fledged token economy, where all classes of assets can be traded on top of the Bitcoin Cash blockchain. This will be enabled through a revised transaction format and also the release and development of various opcodes like OP_CHECKDATASIG. These opcode releases will allow things like Oracles to be programmed into the blockchain. Oracles are key to gaining consensus around the status of a third-party outcome. Projects like Auger require Oracles to determine the outcomes of current events linked to an actively traded betting market on the platform.

THE POTENTIAL FUTURE OF BITCOIN CASHSo with Bitcoin Cash’s popularity growing day-by-day, what does the future look like for the cryptocurrency? Bitcoin Cash has released a roadmap that potentially takes the blockchain in the direction of the Ethereum project, by developing out its own token economy.

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Undoubtedly, there will continue to be further use cases for Bitcoin Cash. To keep up-to-date with the latest information, or to find out more about Bitcoin Cash, make sure you follow Coin Rivet.

CONCLUSIONBitcoin Cash is just one example of how the cryptocurrency community continues to evolve.

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