I've been trying to gather as much information I can about the debate between Bitcoin (BTC) vs. Bitcoin Cash (BCH). Note, that BTC is often referred to as Bitcoin Core. Unfortunately, there is very little reasonable conversations happening within this debate. Rather, both sides of the debate tend to resort to accusations. I'd like to try to boil down the points of each side of the debate.
For anyone unaware of the situation, the very simple explanation is that Bitcoin Cash was a fork of the Bitcoin network that launched on August 1st, 2017. The biggest difference is that they increased the block size from 1MB to 8MB, allowing for lower transaction fees and more transactions per second. Currently, the transaction fees on Bitcoin Core are around $30 per transaction.
Arguments from the Bitcoin Core (BTC) supporters:
- Increasing the block size will centralize the network because it will make it more expensive to host full nodes.
- The current use case of Bitcoin is as a store of value, and not meant for smaller transactions.
- Second layer solutions are in the works such as the lightning network that would allow for transactions to be conducted off chain. It's estimated that Lightning Network won't be ready for another 18 months or so.
- Segregated Witness was implemented to enable the implementation of Lightning Network. SegWit only has about a 12% adoption rate at the moment.
- Closing argument: BTC is the real bitcoin. Just because it's expensive to send Bitcoin right now, there are solutions being worked on. So just wait.
Arguments from the Bitcoin Cash (BCH) supporters:
- Bitcoin is no longer usable and is not what the original vision for Bitcoin was - a peer to peer electronic cash system.
- 1 MB blocks are full, so we must create bigger blocks. 8 MB for now, but can continue to increase over time as needed. This won't be a problem because of Moore's law.
- The approach is to address scaling with a combination of on-chain and off-chain solutions.
- Some have criticized the security of SegWit. I would love to see more technical debate about this as I haven't seen a retort from the SegWit side of the debate.
It will be interesting to see this play out over the course of time. One reasonable take on this is that
- BCH works well and becomes the "Bitcoin of choice" for most users in the short term (next year or two) as it's cheaper and easier to use.
- When BTC implements Lightning Network and other second layer scaling solutions, BTC will become the "Bitcoin of choice" as it will regain some of the earlier traits of being fast and cheap.