Bitcoin Cash (BCH) came about in August 2017 after a hard fork and a split in the Bitcoin blockchain. Bitcoin Cash is a direct result of the constant debates and many opinions about the best approach to cultivate cryptocurrency.
In this guide, you’ll find out exactly what makes Bitcoin Cash special, who’s working with the currency, and where to get your hands on some coins.
Quick Guide – How to Buy Bitcoin Cash
- Get a Bitcoin Cash Wallet
- Get your Bitcoin Cash address (regular or Cash address)
- Find a BCH exchange
- Buy BCH and withdraw them to your wallet
That’s it! If you want a deeper explanation of what Bitcoin Cash is, how to buy it and where to store it keep on reading.
1. What is Bitcoin Cash?
Bitcoin’s blockchain has grown exponentially in recent times. This means that many more users are using the cryptocurrency, which is weighing down the network. The limited Bitcoin block size of 1 MB means that blocks are filling up quickly, resulting in a long queue of unconfirmed transactions. As a result, at peak times, transactions have become slow and expensive.
Bitcoin cash, on the other hand, was initially created with an 8MB block, which was later on increased in size to 32MB. This change allows for more transactions to be processed in each block mined. Many see this as a step forward in terms of how best to scale the network.
Bitcoin Cash opposers remain adamant that it’s simply a short-term fix that doesn’t solve the problem in the long run. Also, they claim there’s no implementation of ideas such as Segwit to help effectively break transactions down into smaller, more manageable pieces.
When a fork occurs on a Blockchain, the currency is basically duplicated. This means that the historical Bitcoin transaction data was copied, and anyone with Bitcoin funds got credited with the same amount of Bitcoin Cash. So does that mean free money?
Sometimes Bitcoin supporters will refer to Bitcoin Cash as Bcash. On November 2018 Bitcoin Cash forked and created Bitcoin SV (Satoshi’s Vision) – a version of Bitcoin Cash with an even larger block size of 128 MB.
2. Buying Bitcoin Cash in 3 Simple Steps
Step 1: Get a Bitcoin Cash Wallet
Before you can buy Bitcoin Cash, you’ll need a Bitcoin Cash wallet to store it in. Hardware wallets that support Bitcoin Cash include industry leaders Ledger and Trezor. Both provide functions for you to use Bitcoin Cash as you would any other cryptocurrency. Both have also introduced the ability to claim your funds if you already owned Bitcoin at the time of the Bitcoin Cash hard fork.
There are a variety of software wallets you can use to store Bitcoin Cash as well.
Exodus provides a great user experience with a seamless coin exchange service known as Shapeshift built it.
Jaxx supports multiple currencies, including Bitcoin Cash. The service runs on desktop and mobile devices, with the ability to pair devices to the same account.
Electron Cash is a derivative of Electrum. If you’re used to Electrum, then you’ll have no problem jumping on board with its sister technology: it’s simply a fork from Electrum with all the necessary components for Bitcoin Cash.
Other wallets include Keepkey, BTC.com, Bitpay, and Coinomi. You can view all available wallets on the official Bitcoin Cash website.
Once you have your wallet, you will need your Bitcoin Cash address. It’s a long string of letters and numbers that start with either a “1” or a “3” – similar to normal Bitcoin addresses.
Since many people got confused and started sending Bitcoins to Bitcoin Cash wallets and vice versa, a new format was invented for Bitcoin Cash. The format, called “Cash Address” is 42 characters long and starts with a “p” or a “q”. Here’s an example:
Keep in mind that Cash Addresses are just a representation of original Bitcoin Cash addresses. This means that the same address can be represented in two different ways (normal format or Cash Address format). Not all wallets support Cash address format.
Step 2: Find a Bitcoin Cash Exchange
Bitcoin Cash exchanges are not as abundant as Bitcoin exchanges. However, there are still some options to work with.
eToro – eToro allows users from around the world to buy and sell Bitcoin Cash with a variety of payment methods. eToro doesn’t give you actual access to your coins and you can’t send coins from eToro to other people. The only thing that can be done with the platform is to buy and sell Bitcoin Cash for fiat currency (i.e. Dollars, Euros, etc.).
IMPORTANT! If you use eToro you don’t actually need a Bitcoin Cash wallet as they don’t supply you the actual coins. Also, Cryptocurrencies can widely fluctuate in prices and are not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework. So keep in mind that your capital is at risk.
Coinmama – One of the oldest exchanges around. Coinmama allows you to buy Bitcoin Cash with a credit card. Coinmama also accepts users from almost all countries around the world.
CEX.IO – Based in London, the company is a trusted, experienced name in the industry, having been around since 2013. You can choose from a selection of currencies, including Bitcoin Cash.The exchange has a brokerage service (easier to use, more expensive) and a trading platform (cheaper but more complex).
Coinbase – The most reputable Bitcoin exchange around, Coinbase supplies Bitcoin Cash support and buy / sell options. Coinbase allows you to get competitive rates if you live in one of the 33 supported countries around the world.
Bitstamp – The oldest exchange around, Bitstamp supports the trading of BCH to Bitcoin and directly to US dollars or Euros. There’s also an option to buy Bitcoin Cash with your credit card at a higher price.
Other options include Bitfinex, Kraken, Poloniex, HitBTC, and more (you can view all available exchanges on Bitcoin Cash’s website).
Step 3: Transfer the BCH to your wallet
As usual, we recommend that you never leave money on an exchange. Once you’ve finished buying your Bitcoin Cash, move it to your own wallet (the one you chose in step 1). You can then follow the status of your transaction using a Bitcoin Cash block explorer. Once you receive three confirmations for your Bitcoin Cash, you can safely say you’ve completed the process.
It’s apparent that Bitcoin Cash has still not gained full acceptance by large parts of the cryptocurrency community. It still sits firmly in second place to its older brother in terms of both price and usage.
Bitcoin Cash has the advantage of being the first major split that has garnered acceptance. Most forks after it didn’t receive nearly enough attention from the community or the media. However, with internal conflicts inside its founding team and accelerated Bitcoin development for scalability solutions, I’m not sure if there’s an actual use case for Bitcoin Cash other than price speculation.