In the world of cryptocurrencies, bitcoin is dominant. But you may have heard of other bitcoins, namely bitcoin cash, bitcoin private, bitcoin diamond, bitcoin gold, bitcoin cash, etc. These currencies other than bitcoin are not the same as the Dubai bitcoin is. The new versions were made by a phenomenon known as a hard fork.
A hard fork happens when a person uses an open-source code and modifies it according to her/his preferences. Bitcoin uses an open-source code, so if anyone sees a problem with it, they use the existing code, modify it and launch their version of a bitcoin.
So this article will discuss two specific alterations of bitcoin core, i.e., bitcoin gold and bitcoin cash.
Why The Need to Create Altered Forms of Bitcoin Arise?
Bitcoin was initially released to solve the problems of the traditional banking system. And it was aimed at decentralization of money, i.e., take control from the central authority and give it to the general public. It is a P2P financial system.
But after the bitcoin boom, the cryptocurrency enthusiast finds problems in the core of bitcoin there; they forked it and created a new version of the bitcoin. We can also say that these forms of currencies could help scale the cryptocurrencies more.
The Purpose of Bitcoin Cash:
It was developed in 2017. Initially, it shared a transaction history with bitcoin, but now the developer has separated it, and it is now an independent currency. But it uses the PoW (proof of work) algorithm and requires ASIC computers to mine it, just like the original bitcoin.
Bitcoin Cash was created because the original bitcoin was continually struggling to process a massive number of transactions. Why? Because bitcoin has a blockchain of 1 MB size. This smaller size was adopted to minimize the likelihood of fraud in bitcoin.
But due to its unprecedented popularity, the size slowed downtime required for transactions per second. And we all know in the virtual world, even nanosecond matters. Therefore, the bitcoin cash was developed by increasing the blockchain’s size to 8 MB to reduce the time and do it more quickly than the bitcoin core.
With bitcoin cash, you can do large transactions without involving a third party and, most importantly, with minimum fees. It also allows you to use it as a payment method in online trading.
The Purpose of Bitcoin Gold:
Bitcoin gold was also developed in 2017. The bitcoin gold was created using a different algorithm known as Equihash. The main idea of Equihash is the creation of an algorithm that is controlled more by memory rather than computing power. Equihash was adopted by a rival of Bitcoin known as Zcash for the same reason, i.e., less computing power consumption.
It was developed because of some mining issues of the original bitcoin. We can mine bitcoins with ASIC (Application Specific Integrated circuit) computers. These computers use less power to mine bitcoins, but they are costly. The mining cost made it easy for the rich and elite to keep their hands on bitcoin instead of ordinary people, which was the primary goal of bitcoin.
Therefore, to put back mining in the hands of everyday people, bitcoin gold was created. It will make mining and cryptocurrency more democratic. Bitcoin gold will allow any regular computer owner to mine bitcoin gold via GPUs (Graphical Processing Units). It incorporates more accessible features than cryptocurrencies.
It may use a different algorithm other than bitcoin, but it works the same as bitcoin does. You can use it for any kind of transaction and investment.
The bitcoin gold may sound appealing, but there is a lot of skepticism around this currency. Critics say that the bitcoin development team operated privately and mined quite a number of it. This would leave a less amount of bitcoin gold to be mined by ordinary people.
But the creators insist that bitcoin will be the most appropriate currency for ordinary people to mine and would also help the original coin scale up.
The price of bitcoin reached in thousands, bitcoin cash in hundreds, but bitcoin gold is new, and it is at a lot lower price than the other two. You can use different exchanges on the market to buy and sell all three of them. So you can research and decide on which one you want to put your money on.
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