Bitcoin Cash’s (BCH) One Year Anniversary: How Has it Fared?

  • Today is Bitcoin Cash’s (BCH) one year anniversary, but recent research shows that its network may be prone to transaction malleability.
  • There are reportedly only 716 merchants who accept BCH, compared to well over 100,000 merchants who accept Bitcoin (BTC)

Today is Bitcoin Cash’s (BCH) one year anniversary. Created exactly 1 year ago on August 1st, 2017 through a fork off of the Bitcoin (BTC) blockchain - it is by no means the only bitcoin fork. 

In fact, there are well over 40 Bitcoin forks out there, however, Bitcoin Cash is the first and most dominant of them all based on its current market capitalization of over $13.2 billion, according to data from CryptoCompare.

Compared to BCH, other BTC forks such as Bitcoin Diamond (BCD) and Bitcoin Gold (BTG) have not had nearly as much impact on the cryptocurrency market. On the other hand, Bitcoin Cash has captured the interest of a fairly large number of crypto devotees.

The Roger Ver-backed Bitcoin fork, however, has been accused by many of misleading crypto investors and traders, particularly the newcomers, because it is often promoted or talked about in a way that perhaps intentionally creates confusion between BTC and BCH.

Satoshi’s “True” Vision

Ver, who was an early cryptocurrency adopter and Purse.io investor, has used his Twitter account over the past the year to constantly criticize bitcoin’s slow transaction processing times and other challenges the flagship cryptocurrency has faced since it was created. Meanwhile, he has continuously praised Bitcoin Cash (BCH) and claims it’s “the real bitcoin.”

Many BCH supporters, including Ver and Civic.com CEO Vinny Lingham, argue that BCH has been implemented according to how Satoshi Nakamoto, the pseudonymous inventor of Bitcoin, had envisioned it and how he had described it in his whitepaper. Bitcoin cash supporters also claim that BTC’s ongoing development has moved away from how Satoshi had wanted it to be.

Despite this controversial narrative, a recent research report shows that, “there is a declining incentive for miners to secure the minority [Bitcoin Cash] BCH network”, as reported by Crypto Globe on July 24th. Moreover, a number of crypto enthusiasts believe that BCH investors may face huge losses in the foreseeable future.

BCH Network May Be Vulnerable

The main argument, as presented by Dr. Wassim Alsindi, Director of Research at Parallel Industries, as to why Bitcoin Cash may be a vulnerable platform is that there’s currently no reliable protection on the BCH network against bad actors potentially manipulating transactions on its blockchain. Alsindi’s research notes that Bitcoin Cash may be insecure because it did not adopt SegWit.

Instead of incorporating SegWit, the Bitcoin Cash community decided to increase block sizes even more from its previous 8 MB to 32 MB via a hard fork on May 15th, 2018. The reason for increasing block sizes, given by the BCH community, was that it would not only allow for more transactions to be processed per block, but also result in lower transaction fees.

Bigger Block Sizes Not Necessarily Better

But bigger blocks may not necessarily be better, as security experts have noted that cryptocurrency platforms with large blocks require the full-node operators (or validators) to download more data before they can verify transactions. This can become quite challenging and even result in the platform’s blockchain ultimately becoming more insecure.

Moreover, many developers think that the better way to address scalability issues is to create sidechains, which can help to handle a lot of the processing load of the main blockchain on cryptocurrency networks. This is also the direction that the ongoing development and upgrades to the Bitcoin (BTC) blockchain appear to  be heading toward.

Only 716 Merchants Accept Bitcoin Cash (BCH)

Getting back to Bitcoin Cash, how does it measure up otherwise in terms of daily transactions per day and rate of adoption? Currently, there are about 20,000 BCH transactions per day, which is up significantly from the 5,000-10,000 daily transactions during the first few months of its existence.

In comparison, there are between 200,000-400,000 daily BTC transactions, which clearly indicates that its usage is much higher than that of BCH. Also, in 2015, it was widely reported that there were over 100,000 merchants who had been accepting Bitcoin (BTC). Given that Bitcoin and the crypto market in general is significantly more prevalent today, the number of merchants accept BTC may be a lot higher.   

Meanwhile, Bitcoin.com, a website that has been known to create brand confusion between the flagship cryptocurrency and Bitcoin Cash, claims that more than 10,000 merchants accept BCH.

This appears to be a bit of an exaggeration, however as acceptbitcoin.cash reports that there are only 716 merchants accept Bitcoin Cash.

Bitcoin Mining Pool Tries to Help Tone Vays Win $10K Bet Against Roger Ver

Cryptocurrency mining pool SlushPool has recently manually added a BTC transaction into a block to help Tone Vays, a derivatives trader and analyst, win a wager mage against BCH proponent Roger Ver.

The wager was made at the 2019 Malta AI & Blockchain Summit, during a debate between bitcoin (BTC) proponent Tone Vays and Bitcoin.com CEO and BCH advocate Roger Ver. In it, Ver argued BTC transactions are too expensive for business use due to the cryptocurrency’s small block size.

Vays, on the other hand, argued segregated witness (SegWit) and second-layer scaling solutions like the Lightning Network allow users to make small transactions without paying high fees, and that he has been using BTC on-chain without paying too much for transactions.

The debate ended up seeing Vays send Roger Ver $5 worth of BTC with a one satoshi per byte transactions fee – equal to the fees paid on the Bitcoin Cash chain – to see if it would confirm the same day. If it did, the CEO of Bitcoin.com claimed he would donate $10,000 to a charity of Vays’ choice.

During the debate, both parties noted the transaction was “priority 23,836 out of 24,355 transactions,” meaning that most transactions on the Bitcoin blockchain had to clear before miners picked that one up, at least according to fees paid for transactions.

As Vays soon noted on social media the transaction cleared after 10 hours. Some, however, found it strange. Cobra Bitcoin, the pseudonymous co-owner of Bitcoin.org and Bitcointalk, pointed out on social media that SlushPool – the mining pool that found the block the transaction was included in – manually added it to help Vays win the bet.

Cobra Bitcoin figured it wasn’t mined “naturally” as it was the second transaction included in the block – right after the coinbase transaction – despite the fee being less than 1% of that of all other transactions included in the block.

On Reddit, users pointed this out and accused SlushPool of manually adding the transaction. The mining pool, according to some users, is known for supporting BTC and being against Bitcoin Cash.

Should Roger Ver Pay?

The wager quickly became a controversial topic that seems to bring back memories of the scaling debate that was going on before Bitcoin Cash forked off of the Bitcoin network back in August of 2017.

Some argue that Roger Ver’s point stands as the transaction wasn’t “naturally” confirmed, but manually included in a block. Moreover the CEO of Bitcoin.com claimed he’d donate the money if it confirmed that day, and when the transaction did confirm it was past midnight in Malta.

On the other hand, some claim the transaction did go through anyway, and as such Roger Ver should donate the funds to a charity of Tone Vays’ choice. Moreover, Vays himself argued BCH supporters could have spammed the BTC mempool with two satoshis per byte transactions to stop his from clearing on time.

On Twitter, Vays created a poll that was retweeted by SlushPool and admitted the mining pool did prioritize the transaction. It currently shows most users believe Roger Ver should donate the funds. As one commenter pointed out, however, the results may change if Ver and other BCH supporters retweet the poll.