What is Bitcoin Cash? (BCH) – A bitFlyer Academy Guide for Beginners

In 2008, Satoshi Nakamoto introduced Bitcoin as “A Peer-to-Peer Electronic Cash System” that leveraged cryptography and blockchain technology. In turn, this laid the foundation for distributed and decentralised financial systems, wherein users can conduct secure transactions without involving third-party intermediaries.Bitcoin’s popularity sky-rocketed in the next few years, driven primarily by the unprecedented possibilities that it enabled within the finance sector. However, in 2017, the community failed to reach a consensus regarding the network’s state, resulting in a hard fork that formed Bitcoin Cash.As such, Bitcoin Cash or BCH inherits Bitcoin’s (BTC) basic features, such as decentralisation, fixed supply, lower costs as compared to traditional finance, global access, and so on. However, BCH’s primary distinction is that it has a greater ‘block size’ than BTC, thus enabling lower processing time and faster transactions. Alongside these, BCH implements certain scalability upgrades, and at the time of writing, is the sixth largest cryptocurrency by market capitalisation. Already a bitFlyer customer? Buy Bitcoin Cash! New to bitFlyer? Register now!The Hard Fork & Bitcoin Cash’s GenesisIn its original form, Bitcoin compromised scalability for security. As Bitcoin’s popularity increased, so did the users’ activity on the network, and in the process, scalability emerged as a major obstacle.In simple terms, because of the low scalability, an increase in the volume (number) of Bitcoin transactions results in an increase in the processing time for individual transactions. In other words, greater transactional volumes imply greater ‘mining’ time, which ultimately results in slower transactions.As a solution to this problem, a section of the community proposed an increase in the block size of the Bitcoin blockchain to 8 MB, raising it from the original 1 MB. The rationale behind this suggestion was that a greater block size would accommodate more transactions in a given period of time, thus enabling faster settlements.The proposal sparked a debate within the community and split it into two factions—one in favour of retaining the original block size by citing security concerns and another supporting the increase. Eventually, this led to a hard fork on August 1st, 2017. Initiated by developers at Bitcoin-ABC, the fork created a…

Source: What is Bitcoin Cash? (BCH) – A bitFlyer Academy Guide for Beginners

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