What Bitcoin Cash Is and How It Differs From Bitcoin

Bitcoin Cash is a separate cryptocurrency that split from Bitcoin in 2017

Bitcoin Cash (BCH) is a digital currency that exists independently from Bitcoin (BTC), even though it started as a copy of Bitcoin's code. In August 2017, a group of Bitcoin developers and miners disagreed about how to handle Bitcoin's technical limitations. Instead of changing Bitcoin itself, they created a new version with different rules. Think of it like a fork in the road — both paths exist, but they go in different directions.

The main difference between Bitcoin and Bitcoin Cash comes down to block size. Bitcoin processes transactions in blocks of 1 megabyte each. Bitcoin Cash increased this to 32 megabytes (and later even larger), which means it can process more transactions at once. Supporters of Bitcoin Cash argue this makes it faster and cheaper to use for everyday payments. Bitcoin supporters argue that larger blocks make it harder to run a full node (a computer that validates all transactions), which could centralize the network.

When the split happened, anyone who owned Bitcoin automatically received an equal amount of Bitcoin Cash. If you held 1 Bitcoin before the split, you ended up with 1 Bitcoin and 1 Bitcoin Cash. This was a one-time event in 2017 and does not happen with new Bitcoin holders.

Key Takeaways

• Bitcoin Cash is a separate cryptocurrency created in 2017 when Bitcoin's code was modified to allow larger transaction blocks.
• Bitcoin Cash processes transactions faster and with lower fees than Bitcoin because it handles more transactions per block.
• Bitcoin and Bitcoin Cash are not interchangeable — they are two different currencies with different values and separate networks.
• People who owned Bitcoin before the August 2017 split received Bitcoin Cash for free, but this does not explore to new Bitcoin purchases today.

Why the split happened: the block size debate

Bitcoin's original design limited each block to 1 megabyte of data. This was meant to prevent spam and keep the network find, but it also created a bottleneck. As Bitcoin became more popular, the network could only process about 7 transactions per second. During busy periods, transactions would pile up in a queue, and users had to pay higher fees to get their transaction processed faster.

Bitcoin developers had different ideas about how to fix this. Some wanted to increase the block size so more transactions could fit in each block. Others wanted to keep blocks small and use separate layers (called the Lightning Network) to handle most transactions off-chain. The disagreement became so fundamental that the community split. Those who wanted larger blocks created Bitcoin Cash, while those who preferred the original approach kept Bitcoin as it was.

This is why Bitcoin Cash supporters often describe it as "peer-to-peer electronic cash" — they believe it works better for small, everyday payments. Bitcoin supporters argue that Bitcoin's smaller blocks and higher fees are worth the trade-off for greater security and decentralization.

How Bitcoin Cash transactions work differently

Bitcoin Cash transactions follow the same basic process as Bitcoin transactions. You send BCH from one wallet address to another, miners validate the transaction, and it gets recorded on the blockchain. The difference is speed and cost. Because Bitcoin Cash blocks are larger, more transactions fit in each block, so the network can process them faster. During normal conditions, a Bitcoin Cash transaction might cost a fraction of a cent, while a Bitcoin transaction might cost several dollars.

Bitcoin Cash also uses a different difficulty adjustment algorithm. Bitcoin recalculates how hard it is to mine new blocks every 2,016 blocks (roughly two weeks). Bitcoin Cash recalculates this every 144 blocks (roughly one day). This means Bitcoin Cash can adapt faster when miners switch between mining Bitcoin and Bitcoin Cash, depending on which is more profitable at that moment.

Both cryptocurrencies use the same type of cryptography and wallet technology, so if you know how to use Bitcoin, you can use Bitcoin Cash. The main thing to remember is that they are separate networks — sending Bitcoin Cash to a Bitcoin address will not work, and vice versa.

The market value and adoption of Bitcoin Cash

Bitcoin Cash has a much smaller market value than Bitcoin. As of any given time, Bitcoin is worth significantly more per coin and has a much larger total market value. This difference reflects the market's preference for Bitcoin as a store of value and the larger number of merchants and exchanges that accept Bitcoin.

Bitcoin Cash is accepted by some online retailers and payment processors, but far fewer than Bitcoin. Some cryptocurrency exchanges list Bitcoin Cash, and you can trade it for other currencies or convert it to regular money. However, Bitcoin Cash is not as widely recognized or used in everyday commerce as Bitcoin is.

The smaller user base and lower price do not mean Bitcoin Cash is worthless or a scam. It is a legitimate cryptocurrency with its own community of developers and supporters. But if you are considering whether to hold Bitcoin Cash as an investment, you should understand that it is riskier and less liquid than Bitcoin, meaning it can be harder to sell quickly at a fair price.

Bitcoin Cash forks and further splits

Bitcoin Cash itself has split into different versions. The most notable split happened in November 2018, when Bitcoin Cash divided into Bitcoin Cash ABC and Bitcoin Cash SV (Satoshi Vision). This happened because the Bitcoin Cash community disagreed about how to upgrade the protocol. Bitcoin Cash ABC kept the name Bitcoin Cash, while Bitcoin Cash SV went its own way.

These further splits show that disagreement about how a cryptocurrency should work is not unique to Bitcoin. Whenever a large community cannot reach consensus, some members may create a new version with different rules. Each version has its own blockchain, its own value, and its own community.

How to tell Bitcoin and Bitcoin Cash apart

Bitcoin and Bitcoin Cash have different ticker symbols. Bitcoin is BTC, and Bitcoin Cash is BCH. This is the clearest way to tell them apart when you are looking at prices or exchange listings. The wallet addresses also look different — Bitcoin addresses often start with 1, 3, or bc1, while Bitcoin Cash addresses often start with bitcoincash: or 1 or 3 (though this can overlap).

If you own cryptocurrency and are not sure which one you have, check your wallet or exchange account. It will clearly label whether you hold BTC or BCH. Never send one to an address meant for the other — the transaction will fail or the coins will be lost.

Frequently Asked Questions

If I own Bitcoin, do I also own Bitcoin Cash?

Only if you owned Bitcoin before August 1, 2017, when the split occurred. Anyone holding Bitcoin on that date received an equal amount of Bitcoin Cash automatically. If you bought Bitcoin after that date, you own only Bitcoin, not Bitcoin Cash.

Is Bitcoin Cash a scam?

Bitcoin Cash is not a scam, but it is a different cryptocurrency with different goals than Bitcoin. It has real developers, real users, and real value. However, it is riskier and less widely accepted than Bitcoin. Do your own research before investing in any cryptocurrency.

Can I use Bitcoin Cash to buy things online?

Some online retailers and payment processors accept Bitcoin Cash, but far fewer than accept Bitcoin. You can check whether a specific merchant takes BCH before you try to pay. You can also convert Bitcoin Cash to regular money through a cryptocurrency exchange and use that money to buy things.

Why is Bitcoin Cash worth less than Bitcoin?

Market value reflects demand and adoption. Bitcoin has more users, more merchant acceptance, and more institutional investment. Bitcoin Cash has a smaller community and fewer places where you can spend it. Lower price does not mean lower quality — it means the market currently values Bitcoin more highly.

What happens if Bitcoin Cash splits again?

If Bitcoin Cash splits again, anyone holding BCH at the time of the split would receive coins on both versions of the network. This happened in 2018 when Bitcoin Cash split into ABC and SV. Each version would have its own value and community, and you would need to manage them separately in your wallet.