Cash, Diamond, & Gold: Bitcoins That Aren't Bitcoin

Fake Bitcoins are becoming a huge problem for the average crypto consumer

Man biting a Bitcoin coin
There's only one real Bitcoin.  s-cphoto / iStock Unreleased / Getty Images Plus

With a brand as recognizable as Bitcoin, it was only a matter of time before newer cryptocurrencies began to appear that tried to piggyback off of its name.

These fake Bitcoins are created by a hard fork off the main Bitcoin blockchain which essentially creates a fully-functional copy of the Bitcoin cryptocurrency. Changes can be made to this newly-created cryptocurrency and it can be given a new name. It's kind of similar to how you can make edits to a Word document and then choose Save As to create a new files instead of clicking on Save to update the original.

Some cryptocoins such as Litecoin are created via this method and go on to become reputable cryptocurrencies in their own right. Others choose to continue using the Bitcoin brand and even claim to be the original. This can cause a lot of confusion for the average user and can even result in the loss of funds. It's because of this that some people refer to these fake Bitcoins as scam coins.

What is Bitcoin Cash?

Bitcoin Cash was created in August, 2017 and it is the most-prominent altcoin using the Bitcoin brand. Bitcoin Cash is supported on a wide variety of Bitcoin ATMs, cryptocurrency wallets, and online services and has been heavily promoted at cryptocurrency events and during televised interviews with industry insiders. Some organizations refer to Bitcoin Cash as BCash to reduce confusion amongst consumers and to help emphasise the fact that it's not related to Bitcoin.

Bitcoin Cash has attracted a lot of controversy due to prominent influencers and websites knowingly misleading consumers by telling them that Bitcoin Cash is Bitcoin when it isn't. This has resulted in companies and individuals mistakenly buying Bitcoin Cash instead of Bitcoin and has caused users to completely lose their funds by sending Bitcoin to a Bitcoin Cash wallet address and vice versa. Doing so essentially makes the funds in the transaction disappear and become unrecoverable.

Bitcoin Cash is a completely separate cryptocurrency from Bitcoin.

What is Bitcoin Gold?

Bitcoin Gold was created in October, 2017 with the intention of making Bitcoin mining more affordable for the average person. Like Bitcoin Cash though, Bitcoin Gold is not Bitcoin so mining Bitcoin Gold will simply reward miners with Bitcoin Gold. It is not an improvement to Bitcoin but a totally new cryptocurrency that uses the Bitcoin brand.

Bitcoin Cash garnered a loyal following because it was the first major Bitcoin spin-off using the Bitcoin brand. Those that were created afterwards, like Bitcoin Gold, however have remained rather niche as more people realize that they have no actual connection to Bitcoin beyond the name.

What is Bitcoin Diamond?

Bitcoin Diamond was created in November, 2017 and is being promoted as a new version of Bitcoin with cheaper transaction fees and improved privacy. This new cryptocoin is ringing a few alarm bells with investors due to its development team being completely anonymous, the source code not being provided, and all of its associated social media accounts being created the month of Bitcoin Diamond's creation.

Other Fake Bitcoins

The list of new cryptocurrencies created from the Bitcoin blockchain is ever-growing given how relatively easy they are to make and maintain. Examples of some other Bitcoin imitators include United Bitcoin, Bitcoin Dark, BitcoinZ, Bitcoin Plus, Bitcoin Scrypt, and Bitcoin Red.

Why Do People Make Fake Bitcoin Currencies?

People tend to make their own versions of Bitcoin mainly to take advantage of its brand name recognition. By creating another cryptocurrency with the Bitcoin name, there's less marketing needed to help promote it in the competitive crypto market. Of course, this logic has begun to backfire as more consumers begin to think of these new Bitcoins as cheap imitations of the real thing.

The whole situation is very similar to how you can find cheap movie bootlegs for sale online. Some people may buy them but these cheap imitations can't compete with the official versions which are better quality and more reliable.

How to Check if Your Bitcoin is Real Bitcoin

When buying, spending, or trading Bitcoin, it's important to check that your cryptocurrency is true Bitcoin and that you're sending it to or requestion it from an authentic Bitcoin wallet address. Here's how to make sure that your Bitcoin is Bitcoin.

  1. Check its name. Bitcoin should be listed as just Bitcoin. If there is another word attached to it such as Cash, Gold, Dark, etc then it's a completely different cryptocurrency and isn't Bitcoin.
  2. Check its code. Most cryptocurrency wallets and online exchanges will have a three digit code next to a coin's name. Bitcoin's official code is BTC. If the coin uses a different code, it isn't Bitcoin.

How to Trade Fake Bitcoin For Real Bitcoin

If you've mistakenly ended up with some fake Bitcoin, you can easily exchange them for some genuine Bitcoin or another cryptocurrency with a solid reputation such as Litecoin or Ethereum. Here's three different methods you can use.

  • ShapeShift: The easiest way to get rid of fake Bitcoin is to use an online service such as ShapeShift which can exchange one cryptocoin for another with the push of a button. If you use the free-to-download Exodus Wallet on your PC or Mac, you can use the ShapeShift service from within this application.
  • An Online Exchange: Another way to swap cryptocurrency is to use an online exchange. This can be more time-consuming than a streamlined service like ShapeShift however and it does require you to setup an account.
  • Bitcoin ATMs: This option is really only available for getting rid of Bitcoin Cash as most Bitcoin ATMs won't support the other Bitcoins. By using a Bitcoin ATM, you can deposit Bitcoin Cash and withdraw real-world money or use it to buy real Bitcoin. Make sure to check that the ATM supports Bitcoin Cash (BCH) deposits. If you send Bitcoin Cash to a regular Bitcoin address, you'll lose your funds and there will be no way to get them back. Only send Bitcoin Cash to a Bitcoin Cash address.