What Made the Bitcoin Cash Fork So Successful?

Bitcoin is arguably the most popular cryptocurrency worldwide, but Bitcoin Cash (BCH), a currency created through a hard fork in the Bitcoin blockchain in August 2017, is almost as popular. Since then, the crypto has grown significantly and has a market cap of $9.23 billion.

While BCH has experienced massive success, many other cryptocurrencies, such as BitConnect, have failed. Below, we’ll delve into how and why Bitcoin Cash was created and what has led to its steady growth into one of the largest cryptocurrencies.

Creation

Like many cryptos, Bitcoin Cash came about through forking—in this case, after the development community discussed increasing transaction speeds on the Bitcoin blockchain.

In 2017, transactions could take from a few hours to a few days, depending on how quickly a block was mined and all transactions in it were confirmed. In instances where a transaction took an extended time to process, the market changed drastically, altering the value of the final processed amount. This has drastically improved, with most blocks currently processed in about ten minutes.

To combat this delay, many in the development community suggested increasing the size of each block. Bitcoin blocks have always been (and still are) 1MB in size. This size constraint limited the number of transactions in a block, creating a bottleneck that resulted in delays.

The idea was that if the block size was increased to 8MB, more transactions could be completed per block. Although this was a simple and effective solution to a growing problem, many in the community were against the size increase. Instead, they supported running transactions on sidechains using the Lightning Network or solutions like Blockstream.

Unable to reach an agreement, the community decided to fork the Bitcoin blockchain at block number 478,558. This fork, which the community that wanted larger block sizes took over, resulted in a new cryptocurrency: Bitcoin Cash.

Bitcoin Cash Success

With a new cryptocurrency birthed, many believed that Bitcoin Cash would fail as it tried to live up to its original namesake. However, those who overtook the development and maintenance of the new coin had a clear and concise vision for it.

Rather than creating a currency that would be used primarily as an investment tool (as Bitcoin is commonly seen), the developers of BCH wanted to create a dynamic and versatile coin that would allow greater flexibility and could be used in day-to-day transactions.

Alongside this vision, certain aspects have helped the coin succeed beyond expectations—despite many still ruling it a failure.

Speed

The developer’s vision of larger block sizes was implemented at BCH’s birth. Blocks on the new blockchain were increased from the standard 1MB to 8MB, allowing much higher transaction volumes and drastically reducing processing times and service fees.

The speed of the Bitcoin Cash network was one of the first factors that drew many to the coin. Unlike Bitcoin, transactions were more likely to reflect current market value as they were processed in significantly less time. This was further improved when the block size was again increased in 2018, this time to 32MB.

Support

BCH launched with many supporters in the crypto market. The development community supporting the currency was extensive at launch due to the number of people who broke away from Bitcoin, and it even drew many Bitcoin experts.

Among these was Jihan Wu, who created a company that specialized in producing hardware best suited for mining Bitcoin. Roger Ver, one of the most significant names in Bitcoin and an early supporter of cryptocurrencies, also voiced his support for BCH early on.

These people, alongside many others, quickly quelled concerns over the coin’s validity and longevity and encouraged massive investment in it—which was evident due to its value.

Value

At launch, Bitcoin Cash was valued at the same as Bitcoin on the day of the hard fork, approximately $240. Those moving to the new blockchain were issued Bitcoin Cash using a 1:1 ratio, where they were given one BCH for each Bitcoin they held.

Soon after the speed of BCH was proven, and extensive support for the coin was given by people like Roger Ver, the coin’s value shot upwards. It hit its highest value just four months after launch, topping out at almost $4,000—an increase of over 1,560%. This quickly settled, with the coin now trading at around $468, well below that of Bitcoin.

Versatility

One of the last reasons for BCH’s success is its versatility, with a wide range of retailers and service providers quickly adopting it as a payment option. These include Newegg, Twitch, CyberGhost VPN, and Microsoft.

Many operators in the iGaming industry also support the coin, thereby allowing gamblers who play on sites like the ones covered in this real money slots article by casinos.com to try their luck using BCH. Other sectors, including select travel brokers and food delivery services, also feature support for the payment method.

Pitfalls

Along the way, some teething problems and setbacks marred BCH’s success. Among these was a contentious disagreement in 2018 that resulted in yet another hard fork, this time resulting in the formation of Bitcoin SV.

Other disagreements within the development community over the direction of the currency have also been prevalent. These have centered around the adoption of secondary-layer technologies like the Lightning Network, funding for future development, and how to implement updates.

None of these disputes has been enough to derail the coin or cause another hard fork. Instead, the focus has remained on providing a stable currency that can be used in a transactional manner and offers low-cost and speedy transactions. This singular focus has helped make the Bitcoin Cash fork one of the most successful in history.