Bitcoin Cash (BCH) was created on 1 August 2017 by hard-forking the original Bitcoin (BTC) blockchain at block number 478,558. At this point the Bitcoin blockchain split into two separate chains, with the Bitcoin Cash (BCH) token effectively becoming a new "altcoin" (even though the idea was to make Bitcoin Cash the dominant form of Bitcoin). The reason for the hard fork was a disagreement among the leading developers on the issue of scaling the Bitcoin (BTC) software which, in its original form, could no longer cope with the ever increasing number of transactions.
The new Bitcoin Cash (BCH) software has solved the scaling problem by increasing the block size to 8 MB (up from 1 MB in Bitcoin), thus improving the transaction speed dramatically. The Bitcoin Cash software does not have a centralised development system and it relies on several separate development teams which provide wallet clients; these include Bitcoin ABC, Bitcoin Classic, Bitcoin Unlimited and Bitcoin XT.
The technical difference between Bitcoin Cash and Bitcoin is that Bitcoin Cash allows larger blocks in its blockchain than Bitcoin, that allows it to process more transactions per second. Bitcoin Cash was the first of the Bitcoin forks, in which software-development teams modified the original Bitcoin computer code and released coins with Bitcoin in their names, with the goal of creating money out of thin air.
Bitcoin Cash trades on digital currency exchanges including Bitstamp, Coinbase, Gemini, Kraken, Bitfinex, and ShapeShift using the Bitcoin Cash name and the BCH ticker symbol for the cryptocurrency. On 26 March 2018, OKEx removed all Bitcoin Cash trading pairs except for BCH/BTC, BCH/ETH and BCH/USDT due to inadequate liquidity. As of May 2018, daily transaction numbers for Bitcoin Cash are about one-tenth of those of bitcoin. Coinbase listed Bitcoin Cash on December 19, 2017.
Bitcoin Cash, use a proof-of-work algorithm to timestamp every new block. It can be described as a partial inversion of a hash function. Bitcoin Cash target a new block to be generated every ten minutes on average. The time needed to calculate a new block is influenced by a parameter called the mining difficulty. If the total amount of mining power increases, an increase of the mining difficulty can keep the block time roughly constant.
Bitcoin Cash use an algorithm to adjust mining difficulty parameter to keep the block generation time equal to ten minutes on average. This algorithm is called the difficulty adjustment algorithm (DAA). Bitcoin Cash adjust mining difficulty parameter every 2016 blocks by usingdifficulty adjustment algorithm. In addition to DAA Bitcoin Cash also used an algorithm, called Emergency Difficulty Adjustment (EDA) algorithm alongside the original DAA to decrease the mining difficulty of Bitcoin Cash by 20%, if the time difference between 6 successive blocks was greater than 12 hours.