Trading Bitcoin has never been more popular. Since its inception, there have been numerous queries related to Bitcoin’s ability to scale effectively. At its core, Bitcoin is a crypto which exists within a network of computers, within the blockchain.
eToro currently boasts an extensive cryptocurrency offering. With a diverse suite of cryptos on offer, the group presently supports access to all both Bitcoin and Bitcoin Cash. In this piece we will go over the differences between the two and which is preferable for investors.
Last month, eToro made waves by announcing it would enter the US market with a basket of ten cryptos. The US subsidiary of eToro will start with Bitcoin, Ethereum, Litecoin, XRP, Dash, Bitcoin Cash, Stellar, Ethereum Classic, NEO, and EOS.
Knowing what to trade
Blockchain is a unique and groundbreaking ledger-recording technology. It makes the ledgers far harder to tamper with for a few reasons: The reality of what has is verified by the function of the majority, not by a single individual or third party. As the network is decentralized; it can be found computers on a global scale.
The key issue with the technology that is behind Bitcoin is the fact that it is rather slow. In comparison to even platforms such as PayPal and Bank transfers the speed of each transaction is at a very minimal pace. Visa can process around 1700 transactions every second, and its actual ability is at about 24,000. Bitcoin on the, on the other hand, is only able to handle around seven transactions every second. The gulf between the two is particularly evident based on this scale.
Is Bitcoin Cash right for you?
Enter Bitcoin Cash, the solution to the problem which has plagued Bitcoin. Originating as a fork of Bitcoin this new system looks to tackle the shortcomings which seem to occur due to the previous currency.
Did COVID-19 Save the Forex Industry?Go to article >>
For a start, the key factor here is the fact that transaction fees on Bitcoin Cash are far lower than those on Bitcoin. The fees on Bitcoin usually can be as high as $1 a transaction, whereas Bitcoin Cash has fees of roughly $0.20 for every transaction. The transfer times of Bitcoin Cash are also faster in the sense that you do not need to wait for over 10 minutes to process a given transaction.
On top of this, Bitcoin Cash allows for the processing of more transactions at a given moment, which means that more people can use the currency at any moment. The reason that Bitcoin Cash can offer these advantages of Bitcoin is the fact that its block on the Blockchain is eight times the size of that of a Bitcoin block. With this key advantage, it would seem that Bitcoin Cash is likely to dominate in the future. However, this may not be the case in reality.
Because Bitcoin Cash is a newer currency, it is still trying to find its place in the market and where it can make a mark. While its price and scalability advantages are clear, it simply does not have the same confidence and backing by those investing in it as Bitcoin.
In addition to this, miners do not make as much profit if they were to mine Bitcoin Cash, which makes them less likely to be involved in the mining of these blocks. Furthermore, there are far fewer trading pairs of BCH and BTC which makes it a little less attractive to global investors and makes it harder to be adopted by individuals who would like to trade in the currency.
Bitcoin offers the advantage in the sense that it is the dominant force in the cryptocurrency market. On the whole, if Bitcoin is doing well other cryptos are more likely to be doing well too, and vice versa. Making up nearly 44.5 percent of the whole capital of the crypto sector, it is quite clearly the dominant player in this field. Its community and popularity are huge, and even those individuals who know little about cryptocurrency are likely to have at least heard of Bitcoin.
As such, while Bitcoin Cash offers the technological advantages over the former currency, it simply does not have the power and community confidence behind it. This does not mean it won’t change in the future, but for this moment at least, Bitcoin will maintain its popularity. With that being said, it’s probably not unfair to suggest that both the currencies are likely to be solid players in the crypto world for years to come.
For the casual investor, it would even make sense to invest in both for different purposes. Bitcoin can be seen somewhat of a longer-term investment as its price is forecast to grow into the future. Bitcoin Cash, on the other hand, can be more useful for transactions if one is using cryptos to purchase things or indeed trade other coins.