If you’re new to Bitcoin Cash, or just want to learn more about its features, this guide is for you. In this article, we’ll provide a beginner’s guide to smart contracts on Bitcoin Cash (SBCH) and why they will be important for mass adoption of the Bitcoin Cash coin. We’ll explain what a smart contract is and how they work, and the benefits of smart contracts. Finally, we’ll provide simple steps to follow so that you can use to experiment with smart contracts yourself.
What is Bitcoin Cash? (Quick Intro)
Bitcoin Cash (BCH) is a cryptocurrency created on August 1, 2017, due to the split in Bitcoin’s blockchain. Bitcoin Cash is a hard fork of the original Bitcoin blockchain, and so it has similar properties of its predecessor. It’s essentially an alternative version of Bitcoin that uses the same history but functions under different rules than what we currently see with Bitcoin.
Some of the key differences between Bitcoin and Bitcoin Cash are:
- The block sizes for Bitcoin Cash are 8 MB and 16 MB versus 1.1 MB allowing for faster transactions
- Faster confirmations and cheaper fees on Bitcoin cash
- Quicker time frame before transactions can be included in a new block.
Bitcoin cash is a result of a large portion of users who experienced difficulties early on with growing transaction fees and sought a more realistic peer to peer payment (P2P) solution.
SmartBCH: The Effect on Bitcoin Cash
Now that we’ve covered the bases in terms of Bitcoin Cash (BCH) let’s dive into the Smart Bitcoin Cash Network. More specifically why Smart Contracts are the next addition to blowing Bitcoin Cash out of the water compared to other layer 1 cryptocurrencies.
Smart contracts For Bitcoin Cash
The Bitcoin Cash community is exhilarated with the advent of Smart Contracts, which has opened up new horizons and possibilities. Although the gap between smart contract-based blockchains and sidechains is still significant, we are in a phase of rapid development. Bitcoin Cash in 2022 is now moving towards smart contracts, which are scripts that run on the Bitcoin Cash network. These contracts allow you to exchange anything that can be represented by a digital number, such as money, titles, shares, and even ideas.
The smart contract can also enforce agreements and automatically execute the agreed-upon actions. To use Bitcoin Cash smart contracts, users must pay a small transaction fee, also known as gas fee to the network. Miners then verify the transaction and update the blockchain to collect the gas fee.
Trying to execute a smart contract without paying any gas fees is like trying to send someone an email (or other packages) without having them pay for stamps. Or better yet, trying to drive from point A to point B without any gas in your vehicle. I.E. Gas fees are the mandatory requirement to execute the contract.
Smart contracts were designed to be simple and low-cost, originally created by the Ethereum blockchain. However, over time Ethereum gas fees became very expensive.
Smart Bitcoin Cash will improve upon the existing framework to offer users much faster transaction times at much higher speed.
So Why Are Ethereum Gas Fees So High?
Despite the fact that Ethereum is the infrastructure highway for the majority of cryptocurrency projects in 2022, its gas fees are simply too high for most users.
The fee structure on Ethereum costs $100 million per year in transaction fees. Because of the high demand for transactions on Ethereum, fees to participate are quite high, resulting in a scalability issue.
Sha-Gate & BCH – Propelling Bitcoin Cash Forward
Sha-Gate is an essential milestone for Decentralized Finance and Bitcoin Cash. It provides a mechanism for trustless swaps between assets. Sha-Gate will be a decentralized bridge between the Bitcoin Cash blockchain and Ethereum’s network. This will allow for trustless and significant interoperability between two of the largest cryptocurrencies by market cap.
Sha-Gate’s Smart Contract Language will be Turing Complete, allowing it to compute any algorithm. This is an important step forward in cryptography as it will enable users to prove that a given condition has been met without the need for disclosure. It is essential to understand that while sha-gate will be used for decentralized finance, it does not provide any new functionality but instead provides a more efficient implementation of existing capabilities.
Future developments on the Sha-Gate protocol could enable decentralized processes such as atomic swaps and computations. This would allow users to move assets back and forth between blockchains without the need for trust in central actors. Sha-gate will be implemented on Bitcoin Cash’s network and is an open-source project, which means anyone can contribute.
It will allow individuals and corporations to build decentralized trading platforms and financial applications without the need for a trusted third party or intermediary.
The most important aspect we should take away from Sha-gate is that it represents a significant step forward for decentralized finance.
Sha-Gate is competing with other projects such as BlockNet and Cosmos to become the standard protocols for interchain communication. It will be interesting to see how these protocols compare with each other.
Key Points About Sha-Gate:
- Cheaper and faster transaction fees than ETH
- A trustless, decentralized market for trading assets
- Turing Complete
- Creation of decentralized applications and smart contracts without the need for a third party or intermediary.
How To Use Smart Contracts With Bitcoin Cash?
The first step you need is to setup Metamask. Setting up Metamask is easy – just follow these simple steps. Once you have Metamask installed, you can start transacting with the Smart BCH network in a secure and anonymous way.
Now that you have setup metamask you need to get your existing Bitcoin cash on to the Smart BCH Network. Follow this video to setup the steps accurately:
SmartBCH has seen a noticeable increase in popularity lately. The initial beta testing period has passed, however, it is still at a very early stage. Current and upcoming projects and protocols should be regarded as serious initiatives to push SBCH into mainstream adoption.
Most tokens on smartBCH (marketcap.cash) are all currently effected by the stagnant market sentiment but saw massive leaps last year near Q4 when the market was firing up. There is vast interest in SmartBCH projects and while it is still early, usually it’s considered risky until there is a decentralized bridge to the public like Sha-Gate in 2022.
SmartBCH is growing and silently achieving milestones other smart-contract blockchains will never meet. The effect Smart BCH has on Bitcoin Cash is currently under the radar with only a small community understanding the true value, but there will be mass adoption and interest at some point in the near future once it’s no longer a secret.