What Is Bitcoin Cash (BCH)?

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Bitcoin Cash (BCH) emerged from one of the most notable debates in blockchain history—a disagreement over scalability, speed, and the original vision of peer-to-peer electronic cash. Born in August 2017 as a hard fork of the Bitcoin network, Bitcoin Cash was created by a coalition of developers, miners, investors, and entrepreneurs who believed that Bitcoin had strayed from its foundational purpose. Their goal? To build a faster, cheaper, and more scalable digital currency suitable for everyday transactions.

At its core, Bitcoin Cash retains many of Bitcoin’s fundamental characteristics but introduces key technical changes—most notably, an increased block size limit. This adjustment allows more transactions per block, reducing fees and confirmation times. Often referred to as "Bitcoin ABC" (Adjustable Blocksize Cap), BCH aims to fulfill what its supporters see as Satoshi Nakamoto’s original vision: a decentralized, borderless cash system accessible to everyone.

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The Origins of Bitcoin Cash: Solving Bitcoin’s Scalability Problem

In 2017, Bitcoin faced growing criticism due to rising transaction fees and slow confirmation times. As adoption surged, the 1MB block size limit became a bottleneck, causing network congestion. Transactions that once cost pennies now ran into several dollars, making microtransactions impractical.

The Bitcoin community split over how to address this issue. One faction supported Segregated Witness (SegWit), a soft fork proposed by developer Pieter Wuille in 2015. SegWit aimed to increase capacity by separating signature data from transaction data, effectively freeing up space within each block. While SegWit was eventually adopted on the Bitcoin network, many believed it was an insufficient solution—more of a workaround than a true fix.

This disagreement led to a hard fork on August 1, 2017, resulting in the creation of Bitcoin Cash. Unlike SegWit, which optimized existing block space, BCH took a direct approach: increase the block size limit from 1MB to 8MB. By 2018, this cap was raised further to 32MB, allowing significantly more transactions per block.

Notable figures such as Jihan Wu (co-founder of Bitmain) and Roger Ver (CEO of Bitcoin.com) backed the new chain, arguing that larger blocks were essential for a functional peer-to-peer electronic cash system.

Technical Differences Between Bitcoin and Bitcoin Cash

While both networks use the Proof-of-Work (PoW) consensus mechanism and share the same genesis block, several key differences set them apart:

Block Size and Transaction Throughput

Bitcoin Cash’s larger block size enables higher transaction throughput. With blocks up to 32MB, BCH can process thousands of transactions per second under optimal conditions—far exceeding Bitcoin’s average of 7 TPS.

Difficulty Adjustment Algorithm (DAA)

Bitcoin adjusts mining difficulty every 2016 blocks (~two weeks). In contrast, Bitcoin Cash adjusts difficulty after every single block, allowing faster adaptation to changes in hash rate. This improves network stability during sudden miner exits or influxes.

Originally, BCH used an Emergency Difficulty Adjustment (EDA) mechanism to prevent mining centralization. However, EDA caused instability and was later replaced with a more balanced DAA.

Signature Scheme: Schnorr Signatures

In 2019, Bitcoin Cash implemented Schnorr signatures—a cryptographic upgrade that enhances privacy and efficiency. Compared to Bitcoin’s ECDSA (Elliptic Curve Digital Signature Algorithm), Schnorr allows multiple signatures to be aggregated into one, reducing data load and improving scalability.

No SegWit Implementation

Unlike Bitcoin, Bitcoin Cash does not use SegWit. Its developers argue that increasing block size is a simpler and more transparent way to scale than restructuring transaction data.

Core Features of Bitcoin Cash

All holders of Bitcoin at the time of the fork received an equal amount of Bitcoin Cash. For example, if you owned 5 BTC before August 1, 2017, you automatically gained 5 BCH—provided you controlled your private keys.

👉 Learn how to securely store and manage your Bitcoin Cash holdings.

Use Cases and Real-World Adoption

Bitcoin Cash advocates position it as “digital cash” rather than “digital gold.” While Bitcoin has evolved into a store of value, BCH focuses on usability for daily payments.

You can send BCH instantly to any individual or business with a BCH wallet. Transaction fees are typically fractions of a cent, making it ideal for micropayments—like buying coffee or tipping content creators online.

Some merchants accept BCH globally, though adoption remains limited compared to traditional payment methods. Websites like Bitcoin.com once mapped thousands of locations accepting BCH, but many listings are outdated or unverified.

Despite this, niche communities and online platforms continue to support BCH for e-commerce, remittances, and peer-to-peer transfers—especially in regions with underdeveloped banking infrastructure.

Storage and Wallet Options

Storing BCH requires a compatible wallet—never send BTC to a BCH address or vice versa, as they operate on separate blockchains.

Recommended wallets include:

These wallets support major operating systems including Windows, macOS, Linux, Android, and iOS.

Always verify wallet authenticity before downloading software. Using reputable platforms ensures your funds remain secure.

The Bitcoin SV Split: A Fracture Within the Fork

In 2018, another hard fork split the Bitcoin Cash community itself. A faction led by Craig S. Wright and Calvin Ayre pushed for even larger blocks—up to 2GB—resulting in the creation of Bitcoin SV (Satoshi’s Vision).

This event sparked what many called the “Hash War,” a costly mining battle between BCH and BSV supporters. However, BSV failed to gain widespread acceptance in the crypto community. Skepticism around Craig Wright’s claim to be Satoshi Nakamoto further damaged credibility.

Today, while both BCH and BSV exist, Bitcoin Cash maintains stronger network support and developer activity.

Frequently Asked Questions (FAQ)

Q: Is Bitcoin Cash the same as Bitcoin?
A: No. While they share common origins, they are separate blockchains with different technical rules and economic properties.

Q: Can I use my Bitcoin wallet for Bitcoin Cash?
A: Only if it explicitly supports BCH. Never send BTC to a BCH address—doing so may result in permanent loss.

Q: Why did Bitcoin Cash fork from Bitcoin?
A: To increase block size and improve scalability for faster, cheaper transactions—aligning more closely with early visions of peer-to-peer digital cash.

Q: Does Bitcoin Cash have smart contract capabilities?
A: Yes. Though not as advanced as Ethereum, recent upgrades have enabled basic smart contract functionality on the BCH network.

Q: Is Bitcoin Cash secure?
A: It uses proven Proof-of-Work security. However, due to lower hash rate compared to Bitcoin, it is theoretically more vulnerable to certain attacks.

Q: What is the future outlook for BCH?
A: Its long-term success depends on broader merchant adoption and continued development focused on usability and privacy enhancements.

Final Thoughts

Bitcoin Cash remains one of the most significant outcomes of blockchain innovation through hard forks. While it hasn't surpassed Bitcoin in popularity or market dominance, it offers a compelling alternative for users prioritizing low fees and fast confirmations.

Whether it will achieve mass adoption as “everyday money” remains to be seen—but for those seeking efficient digital payments without high costs, Bitcoin Cash continues to deliver on its promise.

👉 Start exploring the potential of fast and affordable blockchain transactions now.

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