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Cryptocurrency is a popular topic. Some invested in it and know a lot about it, while some have just heard about one currency, which is Bitcoin. However, that’s not surprising since it’s the most popular cryptocurrency and as of Mar 24, 2022, there are 18.99 million Bitcoins in circulation.
But there is a lot more to cryptocurrency than just Bitcoin, and one of the options you need to know about is Bitcoin Cash, simply known as BCH. This is a proof-of-work blockchain network and cryptocurrency that is faster to use and cheaper than Bitcoin. Let’s explore it in depth.
How BCH was made
Bitcoin Cash was created in 2017 as a hard fork, which is a name for the process of splitting a blockchain in order to create a token that has completely new capabilities and features. It was created in 2017 by one of Bitcoin’s early investors, Roger Ver, and it soon managed to attract investors from all over the world.
The first people who ever owned BCH were holding it before even the hard fork took place. But once it did, people who were Bitcoin investors had the right to the same number of Bitcoin Cash as they did before the fork split.
When BCH was created. It intended to solve a lot of the long-standing issues Bitcoin had at the time and even outperform it in terms of transaction speed. Just like all other cryptocurrencies, BCH tokens protected by a private key and stored in digital wallets.
The difference between BCH and BTC
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The first difference is that BTC can support between 1,000 and 1,500 transactions per lock while BCH can support 25,000, which means the increase in block size is from 1MB to 8MB. This resulted in Bitcoin Cash becoming one of the most popular Bitcoin forks in the world and a top 20 cryptocurrency.
When Bitcoin Cash launched, it was worth approximately $240 per coin. And while it’s nowhere near the worth of Bitcoin which can go up to thousands of dollars, as of March 18, 2022. The worth of BCH was 296.62 US dollars.
However, the lack of Bitcoin Cash’s overall value has its benefits. While Bitcoin’s high price means it functions as a store of value. The relatively low price of Bitcoin Cash makes it more favorable as a form of payment.
Faster validation and bigger block sizes mean that BCH can easily cater to businesses. For example, even a restaurant can accept BCH as payment for smaller-priced transactions. But they couldn’t do the same with Bitcoin.
Due to this lower price, Bitcoin Cash isn’t as dominant in the cryptocurrency market as Bitcoin. Which to some provides less incentive to mine on BCH’s network.
Another thing people often wonder about is whether the price of Bitcoin Cash depends on the price of Bitcoin. While they aren’t tied together directly, when the market for BTC increases, the market for BCH usually follows.
This is because investors are always looking for ways to diversify their portfolios. And since BCH is one of the top cryptocurrencies, it’s a natural choice for investors to flock to when the market is favorable.
If you’re interested, you can read more on the difference between Bitcoin and Bitcoin Cash here.
How you can buy BCH
After the initial hard fork, people who already Bitcoin holders awarded BCH tokens. But times have changed since then and now it’s extremely easy for investors to buy Bitcoin Cash.
The first method you can use is to visit a cryptocurrency exchange, which is a popular method among first-time investors. You can use your local fiat currency or another cryptocurrency to purchase BCH tokens. Once you purchase your Bitcoin Cash, you will be able to move it to your wallet.
Due to various restrictions and regulations, most mainstream cryptocurrency exchanges now require government-issued know your customer (KYC) documents. This means you will probably need something like your driver’s license or Social Security card to purchase BCH.
The second method you can use is peer-to-peer, which would involve purchasing BCH from another person who already holds Bitcoin Cash. To do this, you will need to find a service that will connect you to people who are willing to sell their cryptocurrencies for cash.
These transactions protected by escrow service. Which means a third-party vendor will hold the assets from both parties until the transaction is complete.
Final thoughts
The cryptocurrency market is nowhere near extinction and a lot of people believe. That crypto will become the only currency in the future. While novice investors only care about Bitcoin, smart investors are broadening their horizons and looking at other currencies such as BCH.