Why Bitcoin Cash is so exciting.
By: The Voltaire Team
Tags: Cryptocurrency, Bitcoincash, Bitcoin

In order for cryptocurrencies to be accepted by the mainstream, they must be spent and used as traditional monies: spending is, after all, the core function of any money. Inherently, use cases must be created to encourage spending and hence further adoption. Voltaire is a cryptocurrency exchange that attempts this, implementing both short and long term strategies to do so. We believe the best path to the vision of true financial freedom is Bitcoin Cash. In this blog, we set out the reasons why.

Bigger Blocks, but not really

The main apparent advantage of Bitcoin Cash — when compared to legacy coins — is the larger, 32 MB block size. Often it’s argued that it’s the currency’s biggest selling point. At a high level, perhaps this is true: scaling on chain is the straightforward and originally intended mechanic to boost Bitcoin’s capacity.

What some BCH proponents perhaps overlook is that BCH has tiny transaction fees not because of the bigger block size cap, but there aren’t many using it. The average BCH block at the time of writing contains approximately 200 transactions whilst the average BTC block, over 1400. A full, 32 MB BCH block could allow 32 times that, or 45,000 transactions per block. The true potential of Bitcoin Cash’s larger block size has not yet been realised.

Furthermore, bigger blocks have poor defensibility. Any coin can increase its block size overnight given miner consensus. Bitcoin Cash isn’t better because of its bigger blocks: it’s better because of the people in the ecosystem and their ability to agree, disagree, argue and execute collaboratively.

Decentralisation in Development

Bitcoin Cash development is executed in a sustainable manner. There are at least three implementations which work, all with broadly similar consensus rules. This is powerful, because it allows node operators and more importantly minors to pivot to another implementation should they disagree with the steer of a particular development team. The biggest names in the Bitcoin Cash development community are spread between the three.

Community

Perhaps for us, the most attractive value add of Bitcoin Cash is its community. We saw this first hand at the Scaling for Consensus conference in Hong Kong. Bitcoin Cash is a movement driven by its participants — merchants, miners, developers and capitalists engaging each other, disagreeing, agreeing, building products and services.

Everyday we see progress: the release of Wormhole, the subsequent API implementation by Bitcoin.com and the formation of the bcomm association are great examples. We can’t wait to see what comes next, and even more so, to get involved. We’ll be releasing more details on our community initiative soon.

RBF (replace-by-fee)

Or the lack of it in Bitcoin Cash. This is better because it becomes more difficult to execute a double spend attack. An example of RBF and its implications below:

If Bob is a store owner, and Alice is a customer, Alice sends a transaction to Bob to pay for a coffee. Alice is malicious and wants to defraud Bob, who relies on zero confirmations for speed and practicality. Alice broadcasts a valid transaction to Bob for the coffee and leaves the store. Alice shortly broadcasts another transaction to herself spending the same coins but with a higher fee than in the transaction to Bob. Finally a block is mined and both transactions can not be valid. By default the Bitcoin network includes the transaction Alice made to herself and Bob is out of pocket.

Bitcoin Cash does not have this obscure behaviour built-in and miners rely on time priority as opposed to fee priority. Hence it becomes much harder to execute a successful double spend attack from the moment a transaction is broadcast.

Which sounds like the peer-to-peer digital cash?

The mighty OP_RETURN

The latest upgrade demonstrated the ability of the community to continue to improve the Bitcoin Cash protocol.

The major change is the increase of the OP_RETURN byte limit to 220 bytes. This is a huge deal because OP_RETURN allows data to be written directly to the blockchain, nested inside a transaction. This paves the way for more advanced protocols and applications to be built on Bitcoin Cash.

Bitcoin’s mere 80 byte OP_RETURN limit and high fees stifled the exploration of the blockchain as a decentralised, distributed and hence censorship resistant database for years. The community has added huge usefulness to the network by making a simple change. A great example of value delivery is Memo.cash, a favourite project of ours.

Finally, Bitcoin Cash has more functionality than ever as a result of recently reintroduced OP codes. These can be used to create new types of transactions. A great example is the recent ChainBet protocol created by Jonald Fyookball. Through development execution, we observe the introduction of usefulness.

To Conclude

We’re extremely excited to be part of this community, and even more so to deploy our Bitcoin Cash based exchange. We want to set the standard for trading. We want people to trade in Bitcoin Cash. The peer-to-peer, electronic cash.

It’s a no brainer for us. The Bitcoin Cash community is awesome. It’s filled with productivity, collaboration and innovation. We’ve learnt from our mistakes. Bitcoin was our lesson.