What’s the Difference Between Bitcoin Cash and Bitcoin?

Bitcoin Cash and Bitcoin (BTC) used to be one and the same until August 1, 2017. That’s when the Bitcoin network split and two separate coins were the result. At the moment of the split every owner of Bitcoin had the same amount of coins on both networks.

Since that time BTC has retained a 1MB “blocksize” (the space allowed for transactions every 10 minutes or so) even though transaction throughput had already reached a limit (about 300,000 transactions per day). The result is that BTC transactions can be quite expensive with the average transaction fee reaching as high as $50 at times.

BTC transactions are also potentially very slow if one does not pay a high enough fee. Some transactions get stuck in limbo for days or weeks. To alleviate the problem of congestion and high fees, the BTC community hopes to rely on second-layer solutions (e.g. Lightning Network), only using the BTC network as a settlement layer or for very high-value transactions.

Bitcoin Cash, on the other hand, upgraded its protocol to expand the blocksize. The Bitcoin Cash blocksize is fully adjustable with only soft limits in place. Bitcoin Cash developers research and test larger and larger blocks, working to optimize the network and eliminate potential bugs. As market demand increases and protocol research progresses, the community works together to raise the soft limits on the blocksize over time.

The result is that Bitcoin Cash transactions are extremely inexpensive and only cost a fraction of a penny for a typical transaction. This focus on inexpensive transactions opens up a world of payments-based use cases and allows for the possibility of onboarding millions of users and merchants.