What is Bitcoin Cash?
The crypto currency Bitcoin Cash has only existed since August 1, 2017, when it was separated from the Bitcoin block chain by a so-called hard fork.
Bitcoin Cash was created because the Bitcoin had problems with the speed with which the transactions were carried out among the participants. As a result, you either had to pay a high fee to complete the transaction quickly or you had to wait a long time. But how does Bitcoin Cash work? With the new crypto currency, transaction speeds are no longer a problem. This is because new blocks can be calculated faster. While the size of a single block is limited to 1 MB with the Bitcoin, a block can be up to 8 MB with the new Bitcoin Cash. This means that more transactions can be carried out in a short time, making Bitcoin Cash available to a larger number of users. Should the currency actually establish itself as a similar means of payment as the Euro and other Fiat currencies, the maximum block size can also be adjusted later.
What is the difference between Bitcoin and Bitcoin Cash?
The two crypto currencies are thus based on the same technology, and up to block 478.558, the last block before the fork, even the blockchains are identical. However, the new crypto currency is not a 100% copy, as the two coins differ in their essential functions. While Bitcoin Cash has expanded the maximum block size and thus relies on so-called “on-chain” scaling, the Bitcoin developers have solved the problem of too low transaction speed in the meantime by so-called “off-chain” scaling.
So what is Bitcoin Cash really? The answer to this question is: “An independent crypto currency”. Although the Bitcoin is the original currency, the Bitcoin Cash has been modified so that it is no longer possible to mix the two crypto currencies and transactions cannot be transferred from Bitcoin Cash to the Bitcoin block chain or vice versa.
How does Bitcoin Cash work?
Just like the original currency Bitcoin, Bitcoin Cash also works with blockchain technology. The information is stored on each of the computers participating in the network. This decentralised management means that it is not possible to manipulate the blockchain, as this would require more than 50% of the computing power of the entire network.
But how does Bitcoin Cash work as a means of payment? Who determines the value? As with all crypto currencies, these are the users alone, because there is no regulation, the coin is traded freely. How much a Bitcoin Cash costs therefore depends on supply and demand.
If a participant sends “Bitcoin Cash” to another participant, a new block is calculated by the network and added to the block chain. This block receives the information about the owner of the coins. However, the anonymous procedure does not save any names, as this is an anonymous system. Rather, users can access and forward the Bitcoins using the cryptographic keys located on their wallet, a kind of electronic purse.
Is Bitcoin Cash forgery-proof?
One of the advantages of Bitcoin Cash is that it is absolutely counterfeit-proof. But is that possible? What is Bitcoin Cash for a currency if it is not possible to replicate or sabotage it? The answer lies in managing the information. While in the case of Fiat currencies regulated by banks, management is central, in the case of Bitcoin Cash all network participants are involved in the management. This is done simply by providing computing power. In this way, new blocks can be calculated and confirmed during transactions. This means that each participant has all the information about the Bitcoins stored on the blockchain. Thus, in the event of a forgery, the majority of all participating computers would have to be manipulated.