Bitcoin Cash emerged as a quicker and more cost-effective alternative to Bitcoin following a blockchain split in 2017. Discover the origins of Bitcoin Cash and its significance in the world of cryptocurrency.
**What is Bitcoin Cash?**
Bitcoin Cash, a digital currency that branched off from Bitcoin, offers swifter transaction speeds and lower fees compared to its predecessor. Both cryptocurrencies operate on the blockchain, the technology behind processing transactions. The divergence that led to Bitcoin Cash involved increasing the block size for transactions from 1MB to 8MB initially. With larger blocks, more transactions can be accommodated in each block.
Some advocates envision Bitcoin Cash potentially rivaling traditional payment networks like Visa and PayPal, as it can be used for smaller day-to-day purchases more efficiently than Bitcoin. This is due to factors such as scalability, transaction capacity, fees, and processing time within Bitcoin’s blockchain.
Despite the block size adjustment, Bitcoin Cash can currently handle around 116 transactions per second, potentially reaching 200, which is considerably lower than Visa’s capacity of 65,000 transactions per second. As a comparison, Bitcoin manages around seven transactions per second, while the rapid Solana cryptocurrency boasts an average of about 4,300 transactions per second, claiming to match Visa’s capacity.
**The Origins of Bitcoin Cash**
Bitcoin Cash was established in 2017 when developers identified inefficiencies in Bitcoin such as high fees and sluggish transaction speeds, stemming from increased user activity. To address these issues, a group of developers initiated changes to Bitcoin’s blockchain through a hard fork, resulting in the creation of Bitcoin Cash as a separate entity. This process can be likened to a river splitting into two streams or a fork in the road.
Hard forks occur when blockchain modifications are incompatible with the existing system, necessitating a comprehensive update. Disagreements among developers regarding these alterations can lead to a blockchain split, giving rise to a new digital coin. Conversely, soft forks are also possible, where changes to the blockchain are backward compatible and do not mandate universal consensus or updates.
**Distinguishing Bitcoin Cash from Bitcoin**
Two notable distinctions between Bitcoin Cash and Bitcoin are:
1. **Block Size:** Bitcoin Cash diverges from Bitcoin in terms of its blockchain size and structure. Bitcoin Cash allows blocks of up to 32MB, whereas Bitcoin’s maximum block size is currently 4MB. This expanded capacity enables Bitcoin Cash to process a higher volume of transactions in less time.
2. **Transaction Fees:** Bitcoin Cash generally incurs lower transaction fees compared to Bitcoin due to its larger block size, which allows for more efficient processing. While Bitcoin Cash boasts the capability of handling 25,000 transactions per block, Bitcoin typically manages 1,000 to 1,500 transactions per block. Despite this, Bitcoin still records more daily transactions than Bitcoin Cash, with over 422,000 transactions compared to 15,000 on February 18, 2025.
Hard forks
Join Cash has lower transaction fees than Bitcoin. Transaction fees for each coin vary based on what crypto exchange you’re using and what the pricing model is, but on average, Bitcoin Cash fees are under 1 cent and Bitcoin fees range from $1 to $5. Over the last 30 days, Bitcoin Cash’s average fee was $0.006 to Bitcoin’s $1.78, according to CoinMarketCap as of Feb. 18, 2025.
StatBitcoin Cash Bitcoin Launch: 2017 2009 Number of coins: 19.8 million in circulation / 21 million max 19.8 million in circulation / 21 million max Price: $315.84 $95,539.54 All-time high: $4,355.62 (December 2017) $109,114.88 (January 2025) All-time low: $75.08 (December 2018) $0.04865 (July 2010) Market cap: $6.23 billion $1.89 trillion
Is Bitcoin Cash a good investment? Investing in any crypto is risky, and comes with plenty of cons. Crypto prices aren’t based on underlying assets like stocks or bonds are. They are purely speculative, only driven by what others investors are willing to pay for the coin and the hype behind it — which can vanish quickly. Bitcoin Cash is no exception.
That said, think about what role you want crypto to play in your portfolio ahead of investing. Are you diversifying? Using Bitcoin Cash as a store of value? Hoping that trading crypto will make you millions? Crypto can be part of your financial plan, but it shouldn’t be your only one. A diversified portfolio with a wide range of assets is usually the way to go.
Bottom line, Bitcoin Cash was created from a hard fork in the Bitcoin blockchain to provide faster, cheaper transactions. Bitcoin and Bitcoin Cash have some differences, including their use cases, prices, fees and the volume of transactions they’re able to handle at one time. If you’re considering investing, take the time to understand the risks and don’t invest more than you’re willing to lose.
Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. In addition, investors are advised that past investment product performance is no guarantee of future price appreciation.
