Bitcoin Cash and the Fork: What is it?

Cryptocurrency itself is a new term, and the term fork as it relates to a cryptocurrency requires explanation. In
order to understand a fork, one must first understand the concept of a distributed ledger, or blockchain, upon
which bitcoin and other cryptocurrencies are based. The blockchain contains all of the transactions that ever
happened to that particular cryptocurrency. A transaction can only be added to the chain with an encrypted digital
signature.

The chain, or distributed ledger, exists in a multitude of copies, unlike the more common central database used
by a bank. Thus, not only would a criminal need the correct digital signatures, also known as private keys, to
corrupt the system, the criminal would also need to simultaneously attack and alter every copy of the blockchain.
This is why the blockchain is secure.

However, the system, being distributed, works on consensus. Everyone must use the same computer code that
created, or is, the cryptocurrency. If someone changes the code without the consent of the other members, a
transaction could be processed on one copy of the distributed ledger that would not be represented on all of the
other copies. From that point in time, there would exist an altered version of the blockchain. These two versions
are then said to have forked. In other words, there begins a deviation from what was previously a common history.

Bitcoin experienced such a fork on August 1, 2017. The dispute between two factions centered on the carrying
capacity of the system. Specifically, in this instance, the dispute was over the size of a block, since it is generally
agreed that some adjustment must be made to accommodate the ever-increasing number of bitcoin transactions.
A block is simply the term used to describe the most recent series of bitcoin transactions that have been
accumulated into a discrete group for confirmation as legitimate, then to be added to all the preceding blocks of
the blockchain ledger. Thus, the common way of looking at this matter is that there are now two currencies:

Bitcoin and Bitcoin Cash.

Bitcoin Cash is being treated as a so-called “fork” in the same manner as that of Ethereum and Ethereum Classic.
Ethereum faced a hard fork because there was no consensus on whether to stay with the original ledger
(blockchain) or shift to the new ledger, a discussion necessitated by the discovery of a flaw in the blockchain code
and how to respond to it. However, Ethereum is qualitatively different from Ethereum Classic. Ethereum’s
blockchain is mutable, which means that it can be changed by consensus. This is a major philosophical distinction
vis-à-vis Ethereum Classic, in which the blockchain is immutable. Secondly, Ethereum and Ethereum Classic have
different monetary policies. Without changing these factors, it would be impossible to merge the two blockchains.