Bitcoin Cash (BCH) and Bitcoin (BTC) share a common origin, but since their split in 2017, they’ve evolved along very different technical paths. While some still believe BCH is simply "Bitcoin with bigger blocks," the reality is far more nuanced. Over time, BCH has introduced a series of meaningful upgrades that go well beyond block size, creating a distinct blockchain with unique advantages in scalability, security, and usability.
Let’s explore the key technical differences between BCH and BTC—differences that highlight how BCH has carved out its own identity in the crypto ecosystem.
🔹 Block Size and Transaction Capacity
One of the most visible differences is block size.
When Bitcoin Cash launched, it increased the block size from Bitcoin’s 1MB to 8MB, and later upgraded to 32MB. This allows BCH to handle approximately 10 million transactions per day under normal conditions. Even during peak usage, users typically pay just 1 satoshi per byte, making microtransactions and everyday payments practical.
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In contrast, BTC has maintained a conservative 1MB block size (though SegWit increases effective capacity slightly). There have even been proposals to reduce effective block space further, potentially down to 300KB, favoring a "layered" architecture where most transactions occur off-chain.
As a result, during periods of network congestion, BTC transaction fees can spike 100x or even 1000x higher than BCH’s—making small transfers economically unfeasible.
🔹 Difficulty Adjustment Algorithm (DAA)
The way a blockchain adjusts mining difficulty directly impacts its resilience and stability.
Bitcoin adjusts its mining difficulty every 2,016 blocks—roughly every two weeks. If global hash power suddenly drops (e.g., due to regulatory crackdowns or blackouts), BTC could face extremely slow block times for weeks before the network readjusts. In an extreme case—say, a 90% drop in hashrate—it might take up to 20 weeks for difficulty to stabilize. During this time, users would experience long delays and unconfirmed transactions.
Bitcoin Cash uses a more responsive Dynamic Difficulty Adjustment (DAA) that recalculates difficulty after every single block. This means it can adapt within hours to sudden changes in mining power, ensuring consistent block times and network reliability—even under stress.
This makes BCH significantly more resilient in volatile environments, preserving usability when it matters most.
🔹 Segregated Witness (SegWit): A Flawed Fix?
SegWit was introduced on BTC primarily for two reasons:
- Slight scaling improvement – By moving signature data outside the main block, SegWit effectively increases capacity to about 1.2–1.4MB.
- Enabling the Lightning Network – It addresses transaction malleability, a flaw that complicates off-chain channel setups.
However, BCH developers argue that SegWit is a workaround rather than a true solution. While it reduces malleability for SegWit-address transactions, regular P2PKH addresses remain vulnerable.
BCH took a different path: planning a native fix for transaction malleability in its protocol upgrade. Once implemented, all transactions—regardless of address type—will be immune to malleability issues, without requiring special address formats.
Moreover, with BCH already operating at 32MB blocks, the marginal gain from SegWit-style scaling is negligible. For BCH, SegWit adds complexity without meaningful benefit.
🔹 Replace-by-Fee (RBF): Security vs. Convenience
BTC supports Replace-by-Fee (RBF), allowing users to replace an unconfirmed transaction with a higher-fee version. While useful for fee management, RBF undermines 0-confirmation transaction security, opening doors for double-spending attacks.
There have been documented cases where attackers exploited RBF to reverse payments instantly after receiving goods or services.
Bitcoin Cash removed RBF at launch, prioritizing transaction finality and merchant protection. This makes 0-conf transactions much safer on BCH—crucial for retail use cases like point-of-sale payments.
🔹 Schnorr Signatures: Efficiency Upgrade
Schnorr signatures are a major cryptographic improvement over Bitcoin’s current ECDSA scheme. They offer:
- Smaller signature size
- Faster verification
- Better privacy through signature aggregation
BCH integrated Schnorr signatures in a 2025 network upgrade, enhancing both performance and scalability.
BTC has been discussing Schnorr for years, but due to its cautious governance model and complex consensus process, adoption has been delayed. When—and if—it finally arrives, it will likely come as part of a larger package like Taproot.
For now, BCH leads in deploying proven efficiency upgrades.
🔹 CTOR: Better Transaction Ordering
BCH adopted Canonical Transaction Ordering (CTOR) in a November 2024 upgrade, replacing the older Topological Transaction Ordering (TTOR) used by BTC.
CTOR brings several advantages:
- Simpler implementation: No need to sort parent transactions before children.
- Faster block construction: Eliminates complex CPFP (child-pays-for-parent) logic, reducing template generation time by up to 70%.
- Parallelizable validation: Removes dependency on intermediate states, enabling faster node synchronization.
- Enhanced resistance to denial-of-service attacks: Prevents malicious actors from flooding the network with hard-to-validate ordering schemes.
- Improved compatibility with advanced relay protocols like Graphene.
This change may seem subtle, but it significantly improves network efficiency and scalability—especially as block sizes grow.
🔹 Block Propagation and Compression Technologies
Large blocks only work if they can be transmitted quickly across the network. Slow propagation leads to orphaned blocks and centralization pressure.
BCH employs two cutting-edge compression technologies:
- Xthinner: Achieves up to 99.5% compression, fault-tolerant and efficient even on low-bandwidth connections.
- Graphene: Particularly effective for large blocks, reaching 99.9% compression rates by leveraging CTOR-optimized data structures.
These tools ensure that even 32MB blocks propagate rapidly and reliably across the globe.
BTC, with its smaller blocks and focus on on-chain minimalism, hasn’t adopted such advanced compression methods—making them less relevant in its design philosophy.
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🔹 Token Support: SLP vs Omni
Creating and transferring digital tokens is another area of divergence.
Bitcoin Cash supports the Simple Ledger Protocol (SLP), which allows anyone to issue custom tokens with minimal cost and full support for 0-confirmation transactions. Thousands of tokens—including stablecoins, NFTs, and utility tokens—have already been launched on SLP.
The infrastructure is mature: wallets, explorers, SDKs, and dApps all integrate seamlessly with SLP.
In contrast, BTC relies on the older Omni Layer, best known for issuing USDT. But Omni lacks 0-conf support, has higher fees, and requires cumbersome processes for token creation.
In terms of user-friendly token issuance and usage, SLP outperforms Omni in every aspect.
🔹 Core Keywords Summary
- Bitcoin Cash vs Bitcoin
- BCH technical upgrades
- Block size difference
- DAA vs difficulty adjustment
- SegWit alternative
- CTOR transaction ordering
- SLP token protocol
- Low fee blockchain
❓ Frequently Asked Questions (FAQ)
Q: Is Bitcoin Cash just Bitcoin with bigger blocks?
A: No. While larger blocks were the starting point, BCH has since implemented numerous independent upgrades—including DAA, CTOR, Schnorr signatures, and SLP—that differentiate it fundamentally from BTC.
Q: Why doesn’t BTC adopt DAA like BCH?
A: BTC prioritizes stability and predictability over rapid adaptation. Its bi-weekly difficulty adjustment reflects a design choice favoring long-term consistency, even at the cost of short-term responsiveness.
Q: Can BCH support smart contracts?
A: Yes. Through frameworks like CashScript and libraries like BITBOX, developers can build smart contracts on BCH. While not Turing-complete like Ethereum, BCH supports practical contract logic for payments, auctions, and token systems.
Q: Does removing RBF limit user flexibility?
A: It trades some flexibility for greater security. Without RBF, users can’t bump fees easily—but merchants gain confidence that unconfirmed transactions won’t be replaced.
Q: Is SLP secure for issuing tokens?
A: Yes. SLP runs on top of BCH’s secure base layer and inherits its immutability and decentralization. As long as the underlying chain is safe, so are SLP tokens.
Q: Will BTC ever increase block size like BCH?
A: Unlikely. The BTC community largely views scaling through off-chain solutions (like Lightning Network) as preferable to increasing on-chain capacity.
Bitcoin Cash is not merely a "big-block Bitcoin." It's a continuously evolving blockchain with its own roadmap, philosophy, and technical innovations. From faster difficulty adjustments to advanced compression and native token support, BCH offers a compelling alternative for users who value low fees, fast confirmations, and practical on-chain utility.
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