In less than a month, Bitcoin Cash (BCH) skyrocketed from a low of around $550 to over $1,350 at its peak—a staggering increase of more than 146%. During the same period, Bitcoin's maximum growth was only about 30% from its lowest point.
While Bitcoin still dominates the total market capitalization of digital currencies, alternative coins like BCH are gaining momentum and increasingly moving independently of Bitcoin's influence. Supporters of BCH predict that its price could reach $10,000 by the end of the year and that it may challenge Bitcoin's leading position within the next one to three years.
But beyond price action, what underlying factors could allow BCH to potentially replace Bitcoin? And what challenges is Bitcoin currently facing?
Unprecedented Network Congestion in Bitcoin
When Bitcoin was created in 2009, its mysterious founder, Satoshi Nakamoto, did not impose a fixed limit on individual block sizes. The original design allowed blocks to scale up to 32MB. However, in the early days, transaction volume was minimal, and the average block size was only a few kilobytes. Larger blocks could have made the network vulnerable to DDoS attacks. To enhance security, Nakamoto temporarily limited the block size to 1MB.
As early as 2011, some experts predicted that Bitcoin’s blocks would eventually become congested. But it wasn’t until four years later, when Bitcoin’s price soared and its user base expanded dramatically, that issues like network congestion and high transaction fees became critical. The debate over Bitcoin scaling intensified across the community.
After Nakamoto disappeared from the metzdowd.com forum, the block size issue remained unresolved. By late 2017, the number of unconfirmed Bitcoin transactions exceeded 490,000—a record high and about 600 times more than just three years earlier.
This forced users to pay higher miner fees to expedite transaction processing. At times, these fees even surpassed the cost of transactions on centralized platforms like Visa or PayPal. With growing user demand, reforming Bitcoin’s system became imperative.
The Great Bitcoin Scaling Debate
Jimmy Song, founder of blockchain technology company Paxos, once wrote: “In the world of Bitcoin, developers are the legislative branch, miners are the executive branch, and users are the judicial branch. These three must reach a consensus to implement changes, but achieving that consensus is often extremely difficult.”
Regarding scaling, the conflict mainly arose between developers and miners.
Bitcoin Core developers argued that increasing the block size beyond 1MB would introduce vulnerabilities and destabilize the network. They believed that solutions like Segregated Witness (SegWit) and the Lightning Network could effectively address congestion. Additionally, they maintained that a 1MB block size helped prevent miners from becoming too powerful. If blocks continued to expand over time, running a full node would require more resources, leading to greater centralization of mining power and undermining Bitcoin’s decentralized nature.
Miners held the opposite view. They argued that the Bitcoin network was already centralized even with a 1MB block size, so fears about centralization due to scaling were misplaced. They believed developers were resisting change merely to retain control over the codebase.
Public data from May 4, 2018, showed that fewer than 13 mining pools were responsible for securing the entire network, with the top three controlling more than 51% of the total hashing power.
Before disappearing, Nakamoto had hinted on the metzdowd.com forum that Bitcoin could be scaled if necessary. Miners felt that the Core developers were disregarding Nakamoto’s original vision. Tired of endless debate, miners took matters into their own hands and initiated a hard fork—creating Bitcoin Cash (BCH) with larger blocks.
Key Developers Switch Sides
After Bitcoin’s scaling proposals failed, early Core developers began to go their separate ways. Gavin Andresen, once the lead developer of Bitcoin, voluntarily stepped down from his role. He transferred authority to other developers, a move that dismayed many Bitcoin supporters.
Andresen publicly stated that high transaction fees were eroding Bitcoin’s utility as a medium of exchange. He eventually became one of the most prominent supporters and developers of BCH, claiming that it closely aligns with Nakamoto’s original blueprint for Bitcoin.
Another early Bitcoin developer, Jeff Garzik, was removed from the Core code repository. Garzik had consistently opposed the Core team’s stance on scaling. After his removal, he tweeted that the action represented “cultural retaliation” by Bitcoin Core developers.
Following his departure, Garzik pursued his vision of Bitcoin through UBTC (Bitcoin United), another hard fork. Unlike Bitcoin and BCH, UBTC not only increased the block size to 8MB but also added smart contract capabilities and Segregated Witness. It aims to create a full ecosystem by issuing stablecoins pegged to various fiat currencies.
The Powerful Backing Behind BCH
BCH officially forked from Bitcoin on August 2, 2017, with an increased block size of 8MB and plans for further scaling and smart contract integration. Market activity shows that BCH is gradually gaining user acceptance.
Much of BCH’s support comes from Chinese Bitcoin miners, including Bitmain, one of the world’s largest mining pool operators. Bitmain has openly stated that if Bitcoin’s congestion and high fees persist, it would encourage more miners and exchanges to support BCH—potentially enabling BCH to overtake Bitcoin. The company is positioned to benefit from such a shift.
Due to strong miner support, BCH is often criticized as a centralized version of Bitcoin. Some even call it “China’s Bitcoin,” a label that has attracted both praise and criticism.
Despite this, influential Chinese miners continue to champion BCH. Jiang Zhuo’er, a well-known figure in the space, is often mocked on social media as a “shill” for BCH. Yet, he remains a vocal evangelist, even claiming that BCH supporters understand Bitcoin better than Bitcoin backers themselves.
The Love-Hate Relationship Between Bitcoin and BCH
Consensus mechanisms form the foundation of Bitcoin’s value. If Bitcoin’s dominance were severely challenged, the entire digital currency ecosystem could suffer catastrophic losses. From this perspective, miners—who have invested heavily in Bitcoin—are the least likely to want its demise.
A centralized Bitcoin has no future, but a Bitcoin that isn’t functional also loses its value. Bitcoin and BCH are now locked in a complex, contradictory relationship.
In Bitcoin’s early days, an ordinary laptop could mine thousands of coins daily. Almost no one believed Bitcoin had any value, and buying it was considered absurd. Today, Bitcoin is widely accepted. BCH, which initially gained traction through free airdrops, now boldly aims to replace it.
No one knows what the future holds. To BCH supporters, Bitcoin has become a symbol of dictatorship, while BCH represents free markets and anarchist ideals—closer to Nakamoto’s original vision. Bitcoin loyalists, on the other hand, remain convinced that Bitcoin is the truly decentralized digital currency, unaffected by Nakamoto’s disappearance and destined for a brighter future.
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Frequently Asked Questions
What is Bitcoin Cash (BCH)?
Bitcoin Cash is a cryptocurrency that originated from a hard fork of Bitcoin in 2017. It was created to address Bitcoin's scalability issues by increasing the block size, allowing for more transactions per block and lower fees.
Why did BCH experience a significant price surge?
BCH's price surge was driven by several factors, including growing adoption, increased transaction throughput compared to Bitcoin, and strong support from major mining pools and influential figures in the crypto community.
How does BCH differ from Bitcoin?
The primary difference is the block size: BCH has an 8MB block size compared to Bitcoin's 1MB (later increased with SegWit). This allows BCH to process more transactions per second and generally offer lower fees.
Can BCH really replace Bitcoin?
While BCH supporters believe it can due to its technical advantages, Bitcoin maintains a much larger network effect, brand recognition, and institutional adoption. The outcome depends on technological evolution and community consensus.
What are the risks of investing in BCH?
Like all cryptocurrencies, BCH is volatile and influenced by market sentiment, regulatory changes, and technological shifts. Its reliance on miner support also introduces centralization risks.
Who supports Bitcoin Cash?
BCH is backed by major mining companies like Bitmain, prominent developers like Gavin Andresen, and a segment of the crypto community that values on-chain scalability and low transaction costs.