With Bitcoin and Bitcoin Cash being in a battle for dominance, a big question that has been asked is whether or not the two coins can coexist. They both come from the same branch (in that BCH was just a hard fork of BTC), and when the fork originally happened, the general consensus was that BCH was going to fall to the wayside. Time has proven that it won’t go down that easily, though, leading to the big question: do they even need to be fighting, or do they serve different purposes?

Litecoin and Bitcoin Cash Play Similar Roles

Litecoin has always been dubbed “Bitcoin silver,” as it used to essentially be the same thing, but with faster blocks, a different mining algorithm (Scrypt, which was ASIC-resistant at one time), and a different team behind it. As time has gone on, Litecoin has adopted many new changes, such as SegWit and the Lightning Network, of which the former has now made it to Bitcoin as well.

Aside from being a sort of testbed for cryptos, Litecoin has been time-tested. Most crypto users trust it, and it’s a great way to move funds in a faster and cheaper network. But with Bitcoin Cash, it now has some competition.

Bitcoin Cash is largely being praised for two things: bigger block sizes and the lower fees as a result. Essentially, what this does is put the two in a similar arena, with the differences being that BCH is using a different hashing mechanism, has slower blocks, and doesn’t have SegWit. But when it really comes down to it, in terms of actual usage, the two are essentially the same for the end user.

Transfer of Wealth Vs. Everyday Transactions

The simple fact is that at this point, Bitcoin can’t handle being used for everyday transactions. With fees at the $7.50 or so range as of this writing, that’s just not sustainable. Think about going to buy a $3.50 item, and now it’s $11 – unless fees dropped significantly, most people simply wouldn’t do it, and would use cash instead.

On the other hand, transferring $150k using traditional methods could get expensive. You’d be dealing with wires if you want it to be irreversible, and those come at a high cost – and a great delay. In these cases, that $7.50 fee is nothing compared to what you could otherwise be paying (and the other party could also incur a banking fee, depending on their bank and its benefits).

The best way to look at the two coins as of how they stand right now is:

  • BTC: Large Purchases
  • BCH: Small Purchases

Or, to put it a bit better, BCH would be like a currency, whereas BTC is like gold.

Can Bitcoin Lower Fees Enough to Compete?

The answer to this is that it’s absolutely possible. Fees have already been altered multiple times, decreasing as the value of BTC continued to go up. In fact, it wasn’t until BTC really started to shoot up in price that it got out of control. The blocks being full and the increase in the value of BTC combined have caused the disruption we are seeing. With that said, it’s not so simple to just drop them and be done with it. It does take time, as senders are competing to get into a block. If the attacks die down, it would slowly cause the fees to drop, making them much more manageable. Of course, though, the battle between these two behemoths wages on, punishing the users of the coins in the process while they both keep competing for dominance – something that wouldn’t be needed if they would each focus on separate areas of transacting.

It is also worth noting that the fee cost in dollars is directly related to the coin’s value at the time. A fee of $0.10 when BCH is at $1,000 would be $0.50 if it jumps to $5,000. But because BCH does have bigger blocks and is working to allow more transactions in as needed (so as to keep them from being filled), fees should remain somewhat minimal over time.