Bitcoin Cash or Bitcoin: Which one is the better choice for you?

What exactly is Bitcoin?

Before delving into Bitcoin Cash, let’s first review what Bitcoin (BTC) is all about.

Bitcoin is a form of digital currency that was introduced in 2009 by an unknown person or group of individuals operating under the pseudonym Satoshi Nakamoto. Unlike traditional financial systems that are centralised, Bitcoin is based on a decentralised system that eliminates the need for intermediaries such as banks. Transactions are verified through nodes in the network using cryptography and recorded in a public ledger called blockchain. Unlike centralised financial systems, blockchain can be accessed by anyone. If you wish to learn more about Bitcoin, this article provides an in-depth analysis.

How Was Bitcoin Cash Formed?

Bitcoin Cash (BCH) is a hard fork of Bitcoin that came into existence in 2017 as a solution to Bitcoin’s scalability challenges. In 2015, Bitcoin developer Pieter Wuille proposed an improvement known as Segregated Witness (SegWit), which aimed to decrease the transaction size of each Bitcoin transaction, allowing more transactions to occur concurrently. However, some users and developers opposed the updates associated with SegWit and instead initiated a hard fork that resulted in the creation of Bitcoin Cash (BCH).

Bitcoin Cash has a market capitalization of $14 AUD billion as of June 2024 (according to CoinMarketCap). In November 2018, Bitcoin SV was created as another hard fork of Bitcoin. Bitcoin SV aims to adhere to the original vision of Bitcoin as outlined in the Bitcoin white paper by Satoshi Nakamoto, but with modifications to improve scalability.

One significant difference between Bitcoin and Bitcoin Cash is that the digital signature data for each transaction has been removed from Bitcoin Cash, resulting in smaller data that needs to be verified in each block. Additionally, Bitcoin Cash has increased its ledger’s maximum block size to 32MB since its initial 8MB, allowing it to process more transactions than Bitcoin, which is limited to a maximum block size of 1MB. We will examine the similarities and differences between Bitcoin and Bitcoin Cash in more detail below.

A comparison of the similarities and differences between Bitcoin (BTC) and Bitcoin Cash (BCH).

*All data were accessed on April 13th, 2021, 11:00 EST 

A comparison of the similarities and differences between Bitcoin Cash (BCH) and Litecoin (LTC)

Conversations pertaining to BCH as a form of electronic cash emerged in March 2021, when Kim Dotcom, a digital entrepreneur, drew attention to the disparity in transaction fees between Bitcoin and Bitcoin Cash through a tweet. Dotcom noted that while the median fee for Bitcoin was $8.92 when purchasing a soda, Bitcoin Cash’s median fee was only $0.001, indicating that Bitcoin Cash was better suited for the mass market. This statement prompted Cobra, the owner of bitcoin.org, to argue that Bitcoin’s fees were insignificant when used to buy more expensive items like cars.

In addition, Dotcom highlighted the advantages of Bitcoin Cash as a digital currency on his website titled “Why Bitcoin Cash,” where he described it as “the digital equivalent of cash,” while Bitcoin is “the digital equivalent of gold.” Dotcom further mentioned that there are roughly 3 trillion transactions per year in the global transaction market, with 75% being cash transactions, 13% being credit cards, and the remaining 12% being other payment methods. He claimed that if Bitcoin Cash were to capture just 1% of this market, it would handle 82 million transactions per day.

Smart Bitcoin Cash (SmartBCH) was launched as a Bitcoin Cash side chain in April 2021, which is compatible with Ethereum’s EVM and Web3 API. This project was designed to reduce Ethereum’s transaction fees, which were recorded at $USD 30.45 on April 20th, 2021, at 8:00 EST according to BitInfoCharts. Additionally, the initiative aims to expedite the Smart Bitcoin Cash transaction process, allowing for one billion gas every 15 seconds.

However, Andrew Stone, during Bitcoin Cash Network Discussions, noted that Bitcoin Cash lacked the hype and upward mobility advantage that Bitcoin has. If Bitcoin Cash was not able to scale up to Bitcoin’s level, he was unsure if Smart Bitcoin Cash would be able to scale up to Ethereum. He believed that Smart Bitcoin Cash would only be beneficial as a side chain for Smart Bitcoin Cash users and would not provide a first-mover advantage in Ethereum.

How to Use Bitcoin Cash as Payment

Bitcoinmap is a platform consisting of a web and mobile app for Android that guides users on where to spend Bitcoin Cash (Bitcoinmap). The interactive map displays usage primarily in the United States, Europe, and Asia.

Bitcoin.com maps provide users with the ability to search for nearby businesses that accept Bitcoin Cash as payment (Bitcoin Maps). For instance, one can discover that a realtor in Oshawa and a cell phone and laptop repair company in Scarborough are accepting Bitcoin Cash as a payment method.

There are several ways to buy and sell Bitcoin Cash, including in-person or online trades with individuals, using a crypto ATM (although high transaction fees should be compared), or through a trading platform. When choosing a trading platform, it is important to consider trading fees, pricing, and reliability. One platform that stands out in the global stage for its competitive pricing, reliability, and direct banking access is Virgo.

To buy Bitcoin Cash on Virgo, start by creating an account with your email address and a user name. Once your account is set up, you will need to verify your identity by providing basic information like your name and date of birth. Depositing funds is easy with e-transfer. With funds in your account, you can purchase Bitcoin Cash or other cryptocurrencies like Ethereum, Litecoin, and more. Virgo has a referral program that allows you to earn 20 dollars per referral. To participate, click “invite” in your account, copy your referral link, and share it with friends.