February 20, 2024

History and differences of Bitcoin (BTC) and its forks BCH and BSV

History and differences of Bitcoin (BTC) and its forks BCH and BSV

The launch of Bitcoin in 2009 was undoubtedly a historic moment for the modern financial industry. BTCwhich has become the largest cryptocurrency, is consideredthe brainchild of a computer genius under the pseudonym Satoshi Nakamoto. Nakamoto published a legendary article about Bitcoin in 2008, and the cryptocurrency was officially launched on January 3, 2009.

Bitcoin is positioned as new,a decentralized, blockchain-based electronic currency for P2P payments. Bitcoin is independent from governments, from any central authorities and generally from any financial organizations. It has a limited issue (21 million), and coins are generated during a special process called mining. Bitcoin miners solve complex computational problems on their computers and receive rewards for new coins if they successfully solve these problems.

Since Bitcoin works on a decentralizedinfrastructure, no agency can control it or take possession of a coin. All BTC transactions are stored in a global decentralized registry (blockchain), which cannot be changed and is protected using advanced encryption technologies. Thus, BTC transactions cannot be censored or modified, which makes them safer than regular fiat money. In addition, transactions in bitcoins are faster and have no boundaries, the BTC commission is much lower than that of traditional money transfer and payment systems.

Bitcoin (BTC) was launched with a limited size.1 MB block. Initially, developers adhered to this restriction in order to eliminate the risks of spam transactions that could lead to an overload of the BTC network. But over time, this limitation began to create problems.

With the growing popularity of cryptocurrencies, the volumeBitcoin transactions began to grow sharply, so a block size of 1 MB was not enough for daily processing of the increased number of transactions. So, Bitcoin could only process 4.4 transactions per second, which is why users had to wait for transaction confirmation. Many of them were forced to pay increased commissions to conduct in order of priority.

In this regard, one of the groups raised the question ofsplitting the network, or conducting a hard fork, which caused a real discord in the community. Members of this group suggested increasing the block size so that the network could process more transactions per second, while maintaining a low commission. This initiative was led by Roger Ver, often called the Bitcoin Jesus. He said that Bitcoin deviated from its course and is turning into a “reserve currency” with a high transaction fee. He also wanted Bitcoin to remain the currency for everyday use, as was written in the white pages.

In the end, the debate ended in 2017Bitcoin hard fork, which led to the emergence of Bitcoin Cash or BCH. Roger Ver, the former CEO of Bitcoin.com, has become one of Bitcoin Cash’s main devotees. The BCH was launched with a block size of 8 MB to process more transactions per second and lower commission. As a result, BCH has become more affordable as a regular currency to pay for goods and services. Over time, the maximum BCH block size was increased to 32 MB.

In 2018, the BCH community experienced a firestorma “civil war” between two competing camps, which led to its split and the emergence of Bitcoin SV (Satoshi’s vision). The first group was led by Roger Ver and Jihan Wu from Bitmain, the second (which promoted SV) — scientist, computer engineer Craig S. Wright, and business tycoon Calvin Ayre. According to Wright's group, BCH also deviated from its original course and was becoming a "reserve currency." He called for an immediate split of the network to create a version that would embody Nakamoto's actual vision as described in the white pages.

Bitcoin SV was launched in November 2018 with a huge block size of 128 MB. This allowed us to process even more transactions per second compared to BCH.

It is undeniable that the dispute betweensupporters of BCH and BSV continues. Roger Ver still emphasizes the enormous potential of Bitcoin Cash, while Craig Wright calls for focus on the SV coin. Ver recently announced that BCH has the potential to grow by 100,000% in the near future. Craig Wright, in turn, is desperately promoting the idea of ​​the authenticity of SV, not to mention the fact that he stubbornly impersonates Satoshi Nakamoto himself.

Despite all the controversy and controversy, one thing is clear:both coins, thanks to the advantages of the Bitcoin blockchain and powerful support, occupy top positions in the world ranking of cryptocurrencies. BCH is currently the fifth largest cryptocurrency, BSV — ninth.

Both coins strive to occupy and maintain their niche in the crypto industry. After all, they work for the same purpose — popularize the BTC cryptocurrency and improve its network.

Nevertheless, bitcoin remains and will always befavorite of the public. It is a fact. No hard fork, BCH or BSV (despite their successes and competitive advantages) can ever claim leadership in the crypto industry and in the financial market as a whole. After all, do not forget that every hard fork that we have seen so far has been aimed at maintaining the original Bitcoin exchange rate.