What is Bitcoin Cash (BCH)?

Bitcoin Cash (BCH) is a cryptocurrency that was “forked” from Bitcoin (BTC), the world’s largest cryptocurrency, in 2017 due to a division over the future of the protocol. What does that mean? A fork happens whenever a community makes a change to the blockchain’s protocol, or basic set of rules, that results in a new blockchain. In the case of Bitcoin Cash, the community set out to create a cryptocurrency that’s better suited than Bitcoin for cheap, every day payments.

Bitcoin itself, despite originally being named “Peer-to-Peer Electronic Cash” in its whitepaper published in 2009, may not be well-suited for use as cash in everyday purchases due to its fees. As of May 10, 2021, for example, the median fee to send a Bitcoin transaction was approximately $8.00. Buying a coffee with Bitcoin directly wouldn’t make much sense at those costs. 

And, while there are “second layer” solutions such as the Lightning Network that may enable low-fee transactions, Bitcoin fees can add up (as of December 2021 Bitcoin fees have settled to be less than $1.00 per transaction, Bitcoin Cash fees are typically less than $0.01 per transaction).

Who created Bitcoin Cash (BCH) and why?

In 2017, as Bitcoin’s popularity increased and network fees began to rise, a group of Bitcoin developers proposed a technical solution to support Bitcoin’s use for smaller transactions. In essence, these developers released a new version of Bitcoin’s software that increased the size of Bitcoin’s blockchain (enabling a greater number of transactions to be processed).

The majority group of Bitcoin developers and users disagreed with the software proposal.   A “fork” was created, and Bitcoin Cash became an entirely separate blockchain (although Bitcoin Cash still retained some core features of Bitcoin such as a maximum supply of 21 million coins).

The reason that Bitcoin Cash’s technology was rejected by many Bitcoin developers and users is because a larger blockchain (that can support a greater number of transactions and thus cheaper transactions) comes with a key trade-off. A larger blockchain is harder to validate and store on thousands of computers around the world, which are the foundation of Bitcoin’s decentralized nature (such as ensuring that no individual, company, or organization can tamper with Bitcoin’s blockchain at its core).

When was Bitcoin Cash (BCH) created?

Bitcoin Cash was created as a fork from Bitcoin in 2017.

How do I use Bitcoin Cash (BCH)?

One way to use Bitcoin Cash is to find a merchant that accepts purchases via Coinbase Commerce. Coinbase Commerce enables merchants to easily accept Bitcoin Cash transactions.

Where do I buy Bitcoin Cash (BCH)?

Bitcoin Cash is available via many crypto exchanges and finance apps, including Coinbase.

Released: August 2017