Bitcoin Vs Bitcoin Cash A Comparison Of The Top Cryptocurrencies

Bitcoin and Bitcoin Cash are two of the most widely used cryptocurrencies, sharing similarities in their origins yet differing in meaningful ways. As digital currencies continue to grow in popularity globally, understanding these differences can inform investment choices.

The History Between Bitcoin and Bitcoin Cash

Bitcoin first launched in 2009 as the original decentralized digital currency powered by blockchain technology. For the first several years of Bitcoin’s existence, it saw relatively low mainstream adoption outside of tech circles. However, that changed in 2017 as Bitcoin and cryptocurrencies as a whole gained wider public interest and understanding.

With this surge of usage came scaling challenges in handling transactions on Bitcoin’s network. Bitcoin Cash originated from a group of Bitcoin developers aiming to address limitations they saw in Bitcoin’s transaction speeds and costs. They executed a "hard fork" in August 2017, splitting the Bitcoin blockchain and creating the stand-alone cryptocurrency Bitcoin Cash.

Key Events in Bitcoin vs Bitcoin Cash History

●   January 2009 – Bitcoin network and blockchain created

●   Early 2017 – Bitcoin gains widespread public interest as values accelerate, highlighting scaling issues

●   August 1, 2017 – Bitcoin Cash forked from the Bitcoin network

●   November 15, 2018 – Bitcoin Cash underwent its own hard fork, birthing Bitcoin SV

While created to overcome specific Bitcoin limitations, Bitcoin Cash has not overtaken Bitcoin in value or usage. However, both continue co-existing as popular cryptocurrencies used for various financial transactions and investments.

Speed and Scalability

One primary motivation behind the creation of Bitcoin Cash was improving transaction speeds. This continues to stand as a main differentiator between the two cryptocurrencies:

●   Bitcoin

○   Handles approximately 7 transactions per second

○   Average transaction confirmation time of 10+ minutes

●   Bitcoin Cash

○   Handles about 200 transactions per second

○   Faster average confirmation time of roughly 10 minutes

The higher throughput capacity on Bitcoin Cash’s network allows for faster processing of transactions. Wait times for payments and purchases to complete are shorter, making Bitcoin Cash better suited for everyday use cases like retail transactions. However, Bitcoin still retains an advantage in infrastructure and liquidity by virtue of its first-mover status – more exchanges, wallets, merchants and other entities are integrated with Bitcoin.

Speed and scalability remain a tradeoff, where gains in velocity can accompany decreases in security and decentralization. While they share the same proof-of-work consensus to validate transactions, Bitcoin Cash has larger capacity blocks but Bitcoin offers stronger immutability guarantees.

Cost of Transactions

While users don’t directly pay fees on a credit card or other traditional payment processor, cryptocurrency transactions incur miner fees. These go to incentivize the crypto miners securing and validating transactions on blockchain networks.

Here there is an appreciable difference in the typical fee costs between using Bitcoin vs Bitcoin Cash:

●   Bitcoin – Average transaction fees around $2-3

●   Bitcoin Cash – Fees consistently under $0.01 per transaction

Bitcoin Cash provides significantly lower-cost transactions. This makes it better suited for smaller, everyday purchases without excessive fees taking a bite out of the actual payment amount. Larger Bitcoin purchases can absorb the higher fees more easily.

Market Cap and Liquidity

As the first mover and most established cryptocurrency, Bitcoin enjoys advantages in liquidity and market presence:

●   Bitcoin constitutes nearly 40% of the total global crypto market cap

●   There are more exchanges, payment platforms, wallets and other infrastructure built around Bitcoin

Conversely, Bitcoin Cash – while still a top 20 crypto asset:

●   Makes up closer to 1% of total crypto market share

●   Has fewer venues supporting direct BCH payments

●   Offers overall lower liquidity currently if looking to sell/trade BCH holdings
While Bitcoin Cash brings meaningful technical improvements, network effects and familiarity have allowed Bitcoin to maintain dominance. This leads to considerations around long-term viability and projected future value between choosing Bitcoin vs Bitcoin Cash.

Similarities Between Bitcoin and Bitcoin Cash

Despite their differences, Bitcoin and Bitcoin Cash retain common ground:

●   Both are decentralized digital currencies built on blockchain networks

●   They rely on proof-of-work mining to validate transactions

●   Neither currency has a central authority controlling supply or oversight

●   BTC and BCH can both be used for various financial transactions

So in many ways, Bitcoin Cash stays true to key aspects of Bitcoin while attempting to address challenges around speed and fees. Both also face continued questions around regulation, security, competing altcoins and long-term outlooks in a rapidly evolving landscape.

Should You Invest in Bitcoin or Bitcoin Cash?

There is no definitive answer here that applies universally. With major price volatility over their history, Bitcoin and Bitcoin Cash can reward early investments substantially or lose a large portion of value.

Factors to consider if debating between Bitcoin vs Bitcoin Cash:

●   Use case – Will you use it primarily for payments/transactions or is this a longer-term store of value investment? Favoring Bitcoin Cash or Bitcoin accordingly

●   Time horizon – Shorter term traders may react more to price fluctuations, while longer-term holders depend more on lasting viability

●   Portfolio balance – Most advise limiting overall crypto exposure to <5% of holdings due to risk

●   View on scaling solutions – If you think on-chain scaling improvements are critical, favor Bitcoin Cash

Of course you can also diversify by allocating amounts to both Bitcoin and Bitcoin Cash. This allows you to bet on the growth of blockchain and digital assets overall.

As with any investments – especially cryptocurrencies – you need to assess your own appetite for risk and volatility. Do your own additional research before deciding where to commit financial resources.

Conclusion

Bitcoin and Bitcoin Cash aim to make progress on blockchain’s potential to transform approaches to finance, payments and economical structures. While Bitcoin retains first-mover advantage and leadership in adoption, Bitcoin Cash brings meaningful innovations around transaction speeds and costs.

It remains to be seen how scaling challenges, regulations and competition play out in the emerging crypto space. Yet for those believing in decentralized digital currencies, either or both Bitcoin and Bitcoin Cash warrant consideration based on their similar long-term possibilities and current differences.

By understanding their origins, current contrasts and possible futures, investors can better evaluate opportunities between Bitcoin vs Bitcoin Cash as major cryptocurrencies to own or utilize. Both networks continue evolving alongside blockchain technology itself – making their ongoing journeys foremost in importance compared to any temporary dichotomies today.