Bitcoin Cash (BCH)
(Redirected from Bitcoin Cash)
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- Started in: 2017
Bitcoin Cash was born from a rift in the Bitcoin community over how to scale the network. Those who believed that the Bitcoin block size should be increased split off to create Bitcoin Cash. Each block is 8MB instead of Bitcoin’s 1MB, so BCH can handle up to 60 transactions per second compared to BTC’s 7.
- Here’s a deeper explanation of the fork and why it occurred.
- Current issues:
Bitcoin Cash and its creators have been in an endless quest to prove the legitimacy of BCH over BTC, which has resulted in them being involved in some potentially shady activity.
The network appears to be far more centralised than Bitcoin, and infighting between the lead developers and marketers plagues the brand. BCH sees itself as the ‘true bitcoin’, but lags far behind the original in average users and transaction volume.
- Sometimes BCC or XBC but BCH is the most known ticker.
- Bitcoin Cash is a hard fork created during the controversial scaling debate. It decided to tackle the scaling problem in a different and more immediate way to Bitcoin by increasing the size of its blocks (the pages in the banking analogy) from 1MB to 8MB which doesn’t do anything to speed up transactions but reduces backlogs while retaining security. In order to adapt itself to the large change in computing power experienced over the first few weeks it implemented an emergency difficulty adjustment which allows it to change the block difficulty much more quickly than Bitcoin.
- At the “Future of Bitcoin” conference a developer named Amaury Séchet revealed the Bitcoin ABC” (Adjustable Blocksize Cap) project and told the audience about the upcoming UAHF.
- Following Séchet’s announcement and after Bitcoin ABC’s first client release, the project “Bitcoin Cash” (BCC) was announced. Bitcoin Cash will be pretty much the same as BTC minus a few things, like the Segregated Witness (Segwit) implementation and the Replace-by-Fee (RBF) feature. According to BCC, a few of the biggest differences between BTC and BCC will be three new additions to the bitcoin codebase that include;
- Utility coin for payments and rewards for miners.
- Block Size Limit Increase – Bitcoin Cash provides an immediate increase of the block size limit to 8MB.
- Replay and Wipeout Protection – Should two chains persist, Bitcoin Cash minimizes user disruption, and permits safe and peaceful coexistence of the two chains, with replay and wipeout protection.
- New Transaction Type – As part of the replay protection technology, Bitcoin Cash introduces a new transaction type with additional benefits such as input value signing for improved hardware wallet security, and elimination of the quadratic hashing problem.
"Developer and mining expert Jonathan Toomim took on the issue of BCH difficulty adjustment algorithm. He was careful to note not seeing “any evidence of DAA manipulation” by mining pools and the subject of oscillation as is often alleged. “All of the problems I see in BCH’s hashrate appear to be intrinsic to the DAA’s behavior with naive rational mining strategies. But yes, it should be addressed.
Toomim explained how the BCH DAA was a rush job late in 2017, only months after the fork from BTC, in an effort “to fix some extreme mining profitability and hashrate swings.” What the DAA solved it then created in “a new problem of hashrate echoes or oscillations. Those echoes have gotten much worse in recent months.”"
- The Avalanche pre-consensus has been applied (10-2-2019) on BCHD. On the BCH chain, Avalanche is only being used for pre-consensus and runs parallel with the original proof-of-work consensus mechanism (On Avalanche (AVA) it is used in a PoS system).
Instant transactions / double spend proofs
- Tom Zander revealed (30-8-2019) the double-spend proof (DSP) scheme for the BCH implementation Flowee the Hub.
- From this (3-9-2019) Bitcoin.com article:
"Software developer Awemany has published a potential alternative approach to instant transactions on the Bitcoin Cash network called “delta blocks” or Storm. Awemany’s paper notes that there are some similarities to his idea to Ethereum’s ghost and uncle system. Storm is still far from being ready, the developer stressed, but he believes the code and simulation show the approach is “viable in principle for instant confirmations and that it is in some ways superior to discussed alternatives.”"
- Has options of coin mixing.
Their Other Projects
This is a HUGE DEAL most are overlooking."
- From their website (-5-2021):
"Smart Bitcoin Cash (smartBCH for short) is a sidechain for Bitcoin Cash and has an aim to explore new ideas and unlock possibilities. It is compatible with Ethereum's EVM and Web3 API and provides high throughput for DApps in a fast, secure, and decentralized manner."
Smart Contracts Aspirations On-chain
- Is now also supporting tokens through the Simple Ledger Protocol (SLP).
- Is working on Smart Contract possibilities through Nimbus.
- On if Maker would be possible on BCH. From this Bitcoin.com article (2-12-2019):
“Building a decentralized stablecoin like protocol like Maker DAO on Bitcoin Cash would be very complicated but with the right tools and support it shouldn’t be much more difficult than building it on Ethereum.” However, Ruck again underlines the need for a couple of changes to the Bitcoin Cash transaction format for the stablecoin smart contract concept to work on the BCH chain. The main changes would be merklized script trees, cashassembly, and a preamble. Additionally, Ruck says you could add fractional satoshis and a malleability fix as well as Schnorr signature functionality. The developer also researched a time estimation or how long it would take to implement a project like the Maker DAO on BCH. “The sum would be around 248 days and the total cost around $297,600,” the software engineer suggests."
- From this article (12-12-2019):
"Early on in Bitcoin, several opcodes were disabled due to issues that made them unsafe to use. Within the first year after the Bitcoin Cash fork, the developers of the Bitcoin-ABC node addressed these issues and reintroduced the opcodes with slightly amended functionality, shown in the image below. Most importantly, this update makes it possible to encode and decode structured data within Bitcoin Script, among other things.
Half a year after this, another new opcode was released in the network upgrade of November 2018. The update included
OP_CHECKDATASIG, which allows you to verify a signature for any message inside Bitcoin Script. If we combine the scripting updates that were introduced in 2018, these can be used to bring novel and useful smart contract functionality into Bitcoin Cash.
The two big projects working on this right now are Spedn, which was created by the pseudonymous Tendo Pein, and CashScript, which was created by me and is syntactically inspired by Ethereum's Solidity. These tools make it much easier to work with smart contracts in Bitcoin Cash, although they are still in active development."
- The BCH network has as of 1-2019 nine different full node clients to chose from. Bitprim, Parity, Bcash, Copernicus, Bitcoin Verde, Flowee and BCHD are some of these.
- At the time of writing (3-2019), BU is the second most popular BCH node implementation capturing 44 percent of the 1,518 public nodes. Bitcoin ABC has about 54.4 percent of the public BCH nodes with 826 according to Coin Dance statistics. The smaller implementations Bchd, Flowee, Bitprim, and XT have no more than 10 nodes per client. Update: as of 27-1-2020 BU has 51% an ABC 46%, however, the more important info is that all the other clients have still failed to capture any real stake.
Upgrades and Forks
- A map of the main consensus forks (2009-2019) of Bitcoin can be found here (11-2019).
- After splitting off from BTC on 2017-08-01 the BCH network had the following forks:
2017-11-13: DAA Change (Hard Fork)
2018-05-15: Monolith (Hard Fork) 32MB limit, old opcodes
2018-11-15: Magnatix Anomaly (Hard Fork) OP_CHECKDATASIG, CTOR. This hard fork was contentious with a minority and created Bitcoin SV (to see the further hard forks on BSV check their page, or view this map.
2019-05-15: Great Wall (Hard Fork) Schnorr Signatures
The latest upgrade comes with new opcode support, a chain limit extension, and the improved counting of signature operations using the new “Sigchecks” implementation."
"Bitcoin Cash is set for a network upgrade on November 15, 2020. A BCHN version of the upgrade includes a novel and uncontroversial mining system. The Bitcoin ABC development team has proposed an alternative upgrade that also redirects 8% of mining rewards. So far, 82% of miners have reportedly expressed opposition to the ABC team’s proposal.
First off, the DAA is going to be replaced, regardless of which version of the upgrade is concerned. A new algorithm—ASERT— is set to take its place. According to the upgrade’s GitHub page, the primary motivation for this replacement algorithm is to put an end to variations in Bitcoin Cash’s difficulty and hash rate.
In addition, the replacement algorithm seeks to equalize profit between steady miners, and miners that shift between different blockchains. This update will also aim to maintain block intervals to as close to 10 minutes as possible. Lastly, it is hoped that ASERT will also bring the average transaction confirmation time closer to target time.
The second part—only a feature of the ABC version of the upgrade—, the Coinbase Rule, is the cause of all the controversy (no relation to the exchange, “coinbase” refers to a specific part of a newly mined block). It will require 8% of all block rewards to be sent to a specific Bitcoin Cash address. One controlled by Bitcoin ABC developers, of course.
Lastly, the upgrade will include Replay Protection. This is designed to cause full validating nodes that do not upgrade to separate themselves from the main network after the next upgrade happens on 15 May, 2021. So, make sure not to get left behind."
"CheckDataSig. A protocol change to allow external data signatures to be included in a transaction. This enables the operation of oracles, which have a multitude of use cases, along with other possibilities.
Covenants. A technical innovation that allows Bitcoin script to apply constraints on what the outputs can do. This allows smart contracts like AnyHedge and the Mecenas Last Will.
High level programming languages like Spedn and Cashscript are now available, empowering developers to pursue permissionless innovation.
ASSERT DAA. This difficulty adjustment algorithm keeps block times stable and minimizes oscillations in the multichain SHA-256 ecosystem.
Token Extensions – Beyond the rich SLP ecosystem, further innovations keep happening. For example, a dividend tool that allows you to pay token holders. Imagine the possibilities. A “post office” protocol that allows you to send and receive tokens without any BCH “gas” for fees. Atomic swaps for tokens. Mineable tokens."
SegWit Hard Forks
- BCH does not have SegWit, however some users mistakenly send BCH to SegWit addresses. Over time, more than (25-2-2020) 19,000 BCH have been sent to nested SegWit addresses. From Coin Metrics #39 (25-2-2020):
"Two BCH hard forks are relevant for SegWit recoveries:
On November 15th 2018, SegWit recovery transactions were made completely invalid by a new “cleanstack” consensus rule change
On May 15th 2019 (the following hard fork), this new consensus rule was partially rolled back to only allow SegWit recovery-like transactions.
As analyzed by BitMEX research, several issues compounded after the hard fork which caused various chain splits. One of these issues made miners produce empty blocks. Right after this bug was fixed, the “fake unknown” miner claimed the nested SegWit BCH bounty for himself. The “fake unknown” block claiming the mistakenly lost BCH was indeed orphaned by other miners.
Mining pools orphaning an otherwise valid block on purpose is a very rare event. The fact that it happened to avoid many innocent users losing access to their lost BCH makes it unique.
Publicly identified miners are a paragon of virtue, returning the majority of the BCH they recovered to their rightful owners. However, the fate of half of the lost coins is still undetermined.
They have been “recovered” in blocks that haven’t been associated with any known pool. This “unknown” mining entity has been diligently recovering most of the lost BCH (except for the post-May 15th bounty) since mid-2018."
- Can be found [Insert link here].
- Every six months, the Bitcoin Cash network upgrades, and they usually take place on May 15, and November 15 every year.
- From Bitcoin.com (15-5-2020):
- Bug bounty program can be found [insert here].
Projects that use or built on it
"CashFusion. The most advanced coinjoin protocol ever developed. Providing both privacy and fungibility, CashFusion is a fully decentralized and trustless protocol that operates at the wallet layer. By leaving the base protocol untouched, it also avoids certain regulatory risks.
The AnyHedge protocol allows synthetic derivatives and gives the ability to create new markets so users can instantly take a position on any asset with a price. We’ve leveraged the power of smart contracts on Bitcoin Cash to usher in a new era of trustless and non-custodial trading."
Pros and Cons
The Infrastructure Funding Plan for Bitcoin Cash (IFP)
- On 22-1-2020 an Infrastructure Funding Proposal was announced by Jiang Zhuoer, with backing of Antpool, ViaBTC, Bitcoin.com. This proposal sparked heavy debate in the BCH community and a cascade of suggestions and critique on how the fund should look like followed. A timeline of the events (as of 5-3-2020) from CoinSpice is as follows:
- 01222020 Infrastructure Funding Proposal
- 01222020 BCH devs react
- 01232020 Jiang Zhuoer AMA
- 01232020 Amaury Séchet addendum to IFP
- 01242020 Bitcoin.com releases statement in support of IFP
- 01242020 Jonald Fyookball’s position on the IFP
- 01252020 Justin Bons, Tobias Ruck suggest voting on IFP
- 01252020 Antony Zegers support of IFP
- 01262020 Early market reaction to IFP
- 01262020 Anon dev imaginary_username’s reaction to IFP
- 01262020 Peter Rizun’s reaction to IFP
- 01272020 Opposing Miners Group
- 01272020 BUIP143: Refuse the Coinbase Tax
- 01282020 Bitcoin Verde’s reaction to IFP
- 01282020 Bitcoin.com drops support for IFP
- 01282020 BCHD’s reaction to IFP
- 02312020 Zhuoer’s BCH Miner Donation Plan Update
- 02032020 Ethereum’s Vitalik Buterin, Zcash’s Zooko Wilcox-O’Hearn react to IFP
- 02072020 More Miners Voice Skepticism at Bitcoin Cash Infrastructure Fund Proposals
- 02102020 Giving Bitcoin Cash a Fighting Chance
- 02102020 imaginary_username Speaks: He’s Working to Build a Developer Funding Alternative
- 02122020 Lockdown: From Mainland China, Bitcoiner Talks Coronavirus and Fallout for Crypto
- 02152020 Flipstarter: BCH Voluntary Commons Funding
- 02152020 Bitcoin ABC Will Implement Bitcoin Cash Infrastructure Fund of 5% During May 15, 2020 Upgrade
- 02162020 Roger Ver on Bitcoin Cash Infrastructure Fund Update: Too Controversial, Not Worth it at This Point
- 02162020 Bitcoin Cash Infrastructure Funding Update: BTC.TOP Founder Proposes 2/3 Hash Voting Threshold
- 02172020 Bitcoin Cash IFP Author, Influential Mining CEO to Chinese Bitcoiners: Decentralization is Key
- 02192020 Two Notable Bitcoin Cash Developers Announce Opposition to the IFP
- 02202020 Bitcoin Cash Developers Fork ABC Reference Implementation Client, Create “BCH Node”
- 02212020 First Bitcoin Cash Developer Meeting After IFP Proposal
- 02272020 Bitcoin Cash Node v0.21.0 Formally Released
- 03012020 Wrapping Our Heads Around the Infrastructure Funding Plan for Bitcoin Cash
- 03032020 Bitcoin Cash Node Team Releases General Roadmap Through November
- 03042020 Author of the Bitcoin Cash IFP Vows to Vote Against It, Using Personal Hash in Opposition
- 03242020 Brain Drain: BCH Dev Leaves for AVA and Has Choice Words for Community
- 04012020 Bitcoin ABC Launches $3.3 Million Fundraiser
- 04162020 Trustless, Non-custodial Assurance Contract Platform Flipstarter Launches Five Node Campaigns
- 04252020 PODCAST Bitcoin Cash Reference Client Looks to Raise Sustainable Funding
- 04262020 Bitcoin Cash Node is First to be Fully Funded on Flipstarter; $372,000 Pledged Across 5 Campaigns
- 05092020 PODCAST Amaury Séchet, May 2020 Upgrade Part 2: The IFP and Why it Remains in the Code
- 05142020 BTC TOP & CoinEx CEOs Join BCH Community During 3.5 Hour Pre-Upgrade AMA Livestream
- 05152020 Bitcoin Cash May 2020 Upgrade Completed: Controversial Funding Plan Rejected by Miners
- 05172020 Bitcoin ABC, ViaBTC & CoinEX CEO Publicly Consider a Bitcoin Cash Foundation
- From Bitcoin.com (2-9-2020):
"On August 18, 2020, the Bitcoin ABC development team announced a “feature freeze,” which will include a new Infrastructure Funding Plan (IFP) and a week later explained it was also initiating a “governance council.” Despite the recent announcements, Bitcoin ABC has lost considerable support and it appears the project will separate from Bitcoin Cash come November 15. During the last few weeks, there’s been a lot of contention among the Bitcoin Cash (BCH) community. The controversy really heated up after the Bitcoin ABC development team decided to adopt Jonathan Toomim’s ASERT Difficulty Adjustment Algorithm (DAA), but also included the controversial Infrastructure Funding Proposal (IFP) coinbase rule as well. If the rule was to be applied, approximately 8% of the coinbase reward would be set aside for infrastructure development.
However, an overwhelming share of the Bitcoin Cash (BCH) community does not support the IFP integration into the Bitcoin Cash codebase. A great number of big players, early adopters, developers, full node projects, businesses, miners, and crypto executives have all been very outspoken against the IFP addition.
Those who are against Bitcoin ABC’s current direction include a myriad of engineers from full node projects like BCHN, Knuth, Bitcoin Unlimited, Flowee, Bitcoin Verde, Bitcoincashj, and BCHD. Roughly 50.9% of the last 1,000 blocks have been signaling BCHN and zero blocks so far have been signaling for Bitcoin ABC.
With Bitcoin ABC splitting away from the BCH community and greater ecosystem in general, exchanges will have to decide whether or not the trading platform will support ABC Coin. Furthermore, the team’s former finance manager George Donnelly has also left Bitcoin ABC and has written extensively about how “Amaury Séchet is forking Bitcoin ABC away from Bitcoin Cash.”"
"Bitcoin forks inherit BTC’s supply distribution (at the time of forking), so may appear distributed simply because BTC itself is relatively distributed. But unlike BTC, Bitcoin Cash (BCH) supply held by large addresses has gotten more concentrated over time.
In August 2017, when it forked from BTC, about 14% of BCH supply was held by large addresses with balances of at least 1/1K of total supply. As of February 2020, large addresses hold about 29% of BCH, compared to about 11% for BTC."
"On April 6, Coinmetrics published data indicating that 6 million BCH has not moved since the blockchain forked off from Bitcoin on Aug.1, 2017. With nearly 18.4 million BCH in circulation, 32.6% of existing coins are either lost or being held for the long-term."
Devs, partnerships, teams, etc.
- Bitcoin Cash has support from various members of the cryptocurrency industry including miners, like Bitmain, exchanges, and clients like Bitcoin ABC, Unlimited, and Classic will also be assisting the project. Roger Ver is also a well known advocate for the project.
- Andrea Suisani, dev
- Amaury Séchet, dev Bitcoin ABC (left after the fork)
- Chris Pacia, dev BCHD
- Mark Lundeberg, Independent BCH Developer
- Jason Cox, dev Bitcoin ABC
- Antony Zegers, dev Bitcoin ABC and helps with coordinating the BCH protocol.
- Gabriel Cardona; BCH developer and Bitbox founder (left towards AVAX)
- Tyler Smith; BCHD
- The old CEO of the Dash Latam, George Donnelly, claimed in an interview (10-11-2019) he would take the Dash Latam team away from Dash and focus on BCH now with his new project called Prosuni. This break brought quite some heated discussions on the surface, most claiming George didn't do what he claimed he did, and that his results were sub-par. Update (7-2-2020): Donnelly has now launched BCH Latam.
- Soon after they launched their own SLP token; the PAN token. They sold (7-2-2020) 1700 of the 180000 tokens in the first 2 days.
"[The token is there] to fund the execution of its ambitious project of spreading BCH awareness through Latin America. The proposal includes development of the Panmoni app, a comprehensive ecosystem. It will include the function of sending remittances and also a rewards program for cryptocurrency enthusiasts who onboard businesses and promote adoption in other ways."
"PAN is an SLP token with a fixed 400,000 token supply that we are selling in order to finance our profit-seeking BCH remittances business plan. We have sold about 1% of the 180,000 currently for sale. We aim to give our PAN token real-world utility by having our merchants accept it for goods and services and by making it the currency of our gamified adoption app. We’ve apportioned up to 45% of the total supply to finance 15 to 18 months of runway for our BCH remittances startup Panmoni, 25% for the team and 30% for the gamified adoption app or possibly a second financing round. Full details are available here."
- Is one of the investments chosen by Grayscale, owned by DCG (Grayscale also owns 1% of the BTC supply)
- Bitmain funds some development (Bitcoin ABC) for BCH
- Bitcoin.com markets it heavily. Roger Ver announced (20-11-2019) a $200M BCH Ecosystem Fund. The fund will invest in and incubate businesses like payment gateways, processors remittances, wallet and merchant acquirers.