What Is Plasma Cash?
In short
Plasma Cash is a variant of the Plasma scaling framework that assigns a unique ID number to each asset deposited from the main chain, allowing users to track only the history of their own coins.
In classic Plasma, users need to follow all the data on the child chain in order to safely withdraw their funds; this is a heavy burden. In Plasma Cash, proposed in the Ethereum research community in 2018, each deposit receives a unique ID as an indivisible 'coin'. Because these IDs are held at fixed positions in a sparse Merkle tree, a user can prove ownership by storing only the transactions and proofs belonging to their own coin.
This structure eases the mass exit problem: if the operator cheats, users can exit by presenting only the history of their own coins, not the whole chain. The unique ID approach is also suitable for carrying indivisible assets such as NFTs on the child chain.
The model has clear limits. Because coins are indivisible, paying a particular amount requires owning a coin of exactly that value, which makes everyday payments difficult. As coin histories grow longer over time, the amount of data users store also increases. Although later variant proposals try to ease these problems, the Ethereum ecosystem has over time moved toward rollup-based solutions.
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