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Bitcoin Cash / BCC (BCH) Logo
Bitcoin Cash / BCC
$ 10.16 B
BCH 552.10 K
~ 21.00 M
Total Coins Mined
~ 17.22 M
*General last updated 08/18/18 6:06:19 AM
Forks in coins occur when two or more blocks reach the same block height. When this happened to the Bitcoin blockchain in 2016, it created bottlenecks which in turn led to latency in the network. Higher transaction fees, processing times, and overall user dissatisfaction forced a hard fork. Bitcoin Cash was launched in August of 2017, and 10 months later it sits at number 4 by market capitalization among all other coins.
Like Bitcoin originally, Bitcoin Cash has a fixed supply schedule of 21 million units. When the hard fork occurred, holders of Bitcoin received the equivalent in Bitcoin cash based on the amount they owned (1 BTC = 1 BCH).
The sluggishness of the Bitcoin ledger pushed the community to adopt a hard fork, and amendments like Bitcoin Improvement Proposal 91 (BIP 91) were extolled by people like Roger Ver as an egalitarian improvement. When it was locked, its supporters claimed that it was a means of improving chances of Bitcoin being treated as a real investment so the block size increased to 8 megabytes.
Bitcoin Core developers supported off-chain solutions and Segregated Witness (SegWit), or a soft-fork change in Bitcoin’s transaction structure. They advocated for splitting more important transactions on the main chain, and less important ones on side-chains to increase speed. By decreasing the speed of the Bitcoin networks growth rate, it would keep it more decentralized. Bitcoin Improvement Proposal 9 (BIP 9) was introduced in October as a soft-fork solution to upgrade the network.
The Bitcoin Core client released by Andrew stone abjures the original’s hard-coded 1 megabyte block size standard limit in favor of allowing users on the network to vote on setting limit values. The SegWit proposal was announced at BIP 141 on November 16th as another means of scaling the Bitcoin Network. Like BIP 9 which uses an activation proposal – BIP 141 activates using BIP 9. In order for BIP 141 to lock-in, 95% of the past year’s blocks would have to signal for it to be locked-in.
The lock-in for BIP 141 failed for months to succeed with the debate between those favoring on vs. off-chain solutions leading to a stalemate within the developer’s circle, and broader community. Bitcoin transaction fees continue to increase as 2017 begins. Those in the off-chain solutions camp proposed BIP 148 – which ignores signaling thresholds, forcing BIP 141 to lock in by August 1, 2017.
At the Consensus Conference in New York in May, 58 companies spanning over 20 countries and representing roughly 83% of Bitcoin’s total hashing power agreed on the SegWit 2x proposal. Instead of the 95% threshold, an 80% signaling threshold would contribute to a hard-fork and increased block size from 1 to 2 megabytes after 3 months. BIP 148 was set to trigger by August 1 regardless of whether SegWit 2x was successful. The decrease from 95% to 80% was BIP 91. If it locked in before the end of July, it would override BIP 148.
Bitmain, the company overseeing one of China’s largest mining pools, and also one of the worlds largest hardware wholesalers announced a contingency plan aimed at expanded hash protocols, to be used in the event of an emergency hard fork. The concept for Bitcoin Cash was introduced, alongside a proposed increase from 1 to 8 megabytes. Bitmain announced that several clients like Bitcoin Classic, Bitcoin ABC, and Bitcoin unlimited would support the fork, along with several exchanges and mining pools.
When BIP 91 activated in July, there was speculation that Bitcoin Cash would not launch as there no longer existed an imminent threat from the Activation of BIP 148. On July 22, Bitmain announced that Bitcoin Cash would launch anyways regardless of whether or not BIP 148 was still happening. This came as a huge surprise and shocked many in the crypto community. A push for SegWit 2x and a dismissal and lack of confidence for the original SegWit existed within closed circles of the on-chain solutions group. One exchanged launched Bitcoin Cash futures on July 23, and they started trading at 0.5 BTC, only to drop to 0.1 BTC by the end of the month a week later.
Bitcoin Cash officially launched on August 1st 2017, with holders of Bitcoin receiving 1 BCH for every BTC they held. By August 9, mining Bitcoin Cash was already over 30% more profitable than mining for Bitcoin. When the second half of 2017 sent crypto pricing soaring, especially Bitcoin which flirted above $USD 20,000 / 1 BTC, Bitcoin Cash also saw a huge spike with one of the world’s largest exchanges, Coinbase halting trading at $ USD 8,500 in December.
Bitcoin cash sits at the fourth largest market capitalization, however it is mostly traded as a means of speculation, with only 10% of all Bitcoin Cash held by users actually going towards facilitating actual transactions.
Some of the best community/forum based sources for Bitcoin Cash related information include:
The hard fork created a polarizing effect within the crypto community primarily between the on/off-chain solution camps. Those who favored the ‘one true blockchain’ saw any attempt to add side-chains to the main network as sacrilegious. On the other hand, off-chainer’s felt that the only way to decrease latency and bring transaction fees to heel was either by implementing soft-forks or otherwise changing the SegWit proposals and forcing a hard fork by flooding the network with side-chains.
A crowded blockchain means a larger blockchain, which makes it impractical for the average Bitcoin user to maintain a full node. The decentralization argument proposed by off-chainers was a way to keep institutions or otherwise entities capable of hosting large blocks from concentrating power in tight hands. Their opponents continue to push that increasing block size limits as opposed to scaling off-chain is the better way to go because it results in a higher transaction throughput.
Bitcoin Cash remains a popular investment vehicle and also the first in many proposed and realized Bitcoin forks that continue to draw adherents.