Which Bitcoin?

“Cash? Core? What is the difference?”

So you have heard about bitcoin and you want to get in on this popular currency but you may be asking yourself: what is the difference between these different versions of bitcoin?

A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. — Satoshi Nakamoto

The short answer is that in August of 2017 bitcoin the bitcoin network split into two flavours. The essence of these are summed up as follows:

• Bitcoin Cash:
  Fast, cheap, person-to-person transactions. Follows the Satoshi whitepaper with primary use as digital cash. Transaction fees are typically less than one cent (USD and EUR) and super-fast confirmation times, anywhere in the world, anytime.
• Bitcoin Core:
  Digital gold, store-of-value. Modified from the Satoshi whitepaper to connect with third-party services. Transaction fees are more expensive and can often take days to confirm. This fork of bitcoin is also known as Bitcoin Segwit and Bitcoin Legacy.

Until 2017, Bitcoin Core had a significant first-mover advantage in the cryptocoin space, but this was eroded during 2017 with the increasing use of bitcoin in daily commerce causing the blocks that record user transactions being filled to capacity and the community becoming divided over the best approach to resolving the issue. In short, one group of people wanted to change the nature of Bitcoin from what Satoshi described in the Bitcoin whitepaper as “a purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution” into a fee-market driven settlement layer for financial institutions.

The parties could not find common ground and eventually the community parted ways. Kim Hunter from nTrust wrote this article describing in a bit more detail what became known as the blocksize debate.