CashAddr in the Bitcoin Cash system: what is it, why is it needed, how to get it

The Bitcoin Cash system is quite popular in the crypto community. Its internal virtual coin BCH today has confidently gained a foothold in the 29th position of the crypto market. Many people use bitcoin cash, often involved in digital currency mining, trading and crypto conversions.

It is also impossible to leave unnoticed the high-quality, active support of the Bitcoin Cash system from developers. They regularly introduce updates and also carry out modernizations. Therefore, it is important to understand all the key aspects of this blockchain project, for example, what is CashAddr in the Bitcoin Cash system.

Let us consider this useful question in detail, because it confuses almost all beginners. To effectively use the bitcoin cash crypto coin, you should clearly understand this nuance.

What is CashAddr

It’s no secret that Bitcoin has many forks and Bitcoin Cash is one of them. Naturally, a lot of the basic properties of the BTC cryptocurrency recorded in the main blockchain are transferred to a new branch.

Such branches, for example, include cryptocurrency addresses. This is the wallet account number to and from which coins are deposited/withdrawn. Until January 14, 2018, the options for these addresses in the Bitcoin Cash system and the Bitcoin network remained identical. Or rather, their formats were completely the same.

Initially, the creators of the bitcoin cash coin were not very happy with this situation. To differ from the Bitcoin network addresses, they introduced crypto wallet addresses with a new format. This is what they began to call CashAddr in the Bitcoin Cash system.

Remember! Mention of the Bitcoin Cash project or its BCH cryptocoin may appear together with CashAddr. This means that we are talking about a special type of storage address for bitcoin cash. This is a different protocol than Bitcoin address options!

Today, almost all resources related to cryptocurrencies use this format. They probably work with CashAddr in the Bitcoin Cash system. Despite this, it is important to understand the nuances and features of this protocol. There are still market players who have not switched to it.

Features of CashAddr

In the early years of bitcoin cash’s existence, the following types of addresses were encountered:

1Lmv7DivfNaA1zPfTL5S1eP5QGePTfi2DM

That is, it was a 34-digit combination of numbers and different letters. The options had arbitrary characters (letters of various cases, as well as numbers) – the format was exactly the same as in the Bitcoin address system. But then the developers introduced a new version of the protocol and CashAddr appeared in the Bitcoin Cash system.

Thus, 2 types of varieties of BCH addresses began to form:

– without a prefix – for example:

J7k5Fhdu9N401gl492hrKD64H7RhsF4lk5

– having a prefix – in particular, bitcoin cash:

J7k5Fhdu9N401gl492hrKD64H7RhsF4lk5

You can see that the actual length of the CashAddr address in the Bitcoin Cash system increases in one of the options. It is 12 characters longer, indicating the type of cryptocurrency.

In addition, when using a BCH wallet, people can optionally assign a prefix extension. It will indicate the address and name of the digital currency.

Of course, the option allows you to create type 2 accounts with the prefix “bitcoincash:” because the main address remains the same.

Why is CashAddr required in the Bitcoin Cash system?

There are at least 3 reasons why there was a change in the protocol of cryptocurrency addresses in the Bitcoin Cash system.

The first factor is to simplify transactions

The actual reason has been clarified by the developers. They say the transition to a new protocol was made to simplify the classification of transactions.

In the beginning, there were identical address formats for the Bitcoin system and the Bitcoin Cash project. Users were allegedly confused about their payments – it is not clear what is being translated – BTC or BCH?

Now, after introducing CashAddr in the Bitcoin Cash system, you can clearly see that a BCH transaction has been completed. This goal was clearly the main one.

The second factor is minimizing errors

Another problem that can be solved using the new address format is to eliminate errors during operations. Let’s say 10 bitcoin cannot be transferred to the bitcoin cash crypto wallet account:

J7k5Fhdu9N401gl492hrKD64H7RhsF4lk5, and 10 BCH is possible.

Apparently there were earlier complaints about errors in translations, when people sent bitcoins instead of bitcoin cash. These are cryptocurrencies that are completely unequal in price.

The third factor is the uniqueness of the project

The final reason for CashAddr’s existence in the Bitcoin Cash system is simply to position itself as a commercial blockchain project.

The developers needed to create a unique difference. Otherwise, people would not see the distinctive features between the fork and Bitcoin.

Thus they formed an original system. Now the old BTC addresses are almost never used due to the implementation of CashAddr in the Bitcoin Cash system.

Conclusion

Many services and vaults that use digital coins usually automatically change the format of the displayed address. But always with the old version of the crypto address, you need to switch to a new one – for example, CashAddr in the Bitcoin Cash system.