While many top cryptocurrencies have seen new all-time highs in 2021, Bitcoin Cash has yet to reclaim prices near its top in 2017. Although this may mean there is more potential upside, many investors are bearish on the fact Bitcoin Cash hasn’t picked up much traction as of late. This is likely due to other cryptocurrencies competing in the space, many of which have more active developers than Bitcoin Cash (BCH).
To learn more about how to buy Bitcoin Cash, follow our guide on how to go about purchasing digital assets today.
What is Bitcoin Cash?
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Despite having similar names, Bitcoin and Bitcoin Cash are 2 separate cryptocurrencies that run on 2 distinct blockchains. Bitcoin Cash came about after a disagreement arose about Bitcoin’s block size. While Bitcoin was initially intended to be a peer to peer currency, its high transaction fees inhibit it from being feasible for day to day purchases. By increasing the block size, Bitcoin Cash allows for faster and cheaper transactions.
In 2017, Bitcoin underwent a hard fork which split its blockchain into Bitcoin and Bitcoin Cash. For each Bitcoin one owned in 2017, they were given 1 Bitcoin Cash at the time of the fork. Since then, Bitcoin has remained the leader between these 2 cryptocurrencies, and Bitcoin Cash has lost market share to newer proof of stake blockchains.
The Block Size Dilemma
During summer 2017, several high-profile Bitcoin miners had a problem. Bitcoin had increased in popularity and millions of new participants entered the space. With so many new traders, transactions without timestamps kept piling up. Blocks were limited to 1MB and miners began having difficulty processing all the new data efficiently.
The results were constant processing delays and increased fees for buyers who wanted their data moved to the front of the line. Some Bitcoin miners argued that 1MB was simply too small and more size was needed to handle the excessive transaction volume.
The Bitcoin Hard Fork
On August 1, 2017, a group of miners altered the Bitcoin code to create the offshoot (or hard fork) currency, Bitcoin Cash. Unlike its original counterpart, Bitcoin Cash capped block size at 8 MBs and recorded its transaction data outside the Bitcoin network. For each Bitcoin owned prior to the hard fork, 1 Bitcoin Cash was credited proportionally to the amount of Bitcoin one owned at the time.
Bitcoin Cash now trades as a completely different entity than Bitcoin, and has arguably been left behind in the recent 2021 cryptocurrency bull market. Like its predecessor, Bitcoin Cash cannot be traded on any stock exchange. However, you can trade Bitcoin Cash from certain stock brokerages, such as Robinhood.
The Problem With Proof of Work
Many legacy blockchains, like Bitcoin, Ethereum and Litecoin, use Proof of Work consensus. This consensus model validates transactions through energy intensive hashing algorithms, which has recently raised environmental concerns. Plus, Proof of Work can only support a limited amount of transactions per second, whereas proof of stake blockchains can process thousands of transactions per second. This is one of the primary reasons Proof of Stake blockchains like Cardano, Polkadot, and Solana have outperformed other cryptocurrencies in 2021.
How to Buy Bitcoin Cash (BCH)
Ready to learn how to buy Bitcoin Cash? Here’s a quick guide on how to get started investing today.
- Open an online account.
If you don’t already have a cryptocurrency exchange account, you’ll need to make one in order to buy Bitcoin Cash. As an investor in digital assets, your top priority should be security. Some U.S based exchanges with top-tier security are Coinbase, Robinhood and Gemini. Coinbase is a great option for new investor, as it has an easy to use interface. Plus, the Coinbase Learn program pays you in cryptocurrency for watching short informational videos on blockchain technology!
- Buy a hardware wallet (optional).
While you don’t need a cryptocurrency wallet to buy Bitcoin Cash, it’s a good idea to use one once you’ve made your purchase. Centralized exchanges hold custody over your digital assets, making exchanges huge targets for cryptocurrency hackers. To mitigate this risk, use a crypto wallet. Software wallets are free to use, but hardware wallets offer the best security possible. Hardware wallets store your digital assets offline, making it impossible for your funds to be stolen by online hackers. If you’re in the market for a hardware wallet, look no further than the leader in the space –– the Ledger Nano X.
- Make your purchase.
Almost there! To buy Bitcoin Cash, simply place a market or limit order on your exchange of choice. Market orders will purchase your BCH within a few seconds at market price, whereas limit orders only execute if the asset in question dips to a certain, pre-specified price.
Best Crypto Exchanges For Bitcoin Cash
Don’t have a cryptocurrency exchange account yet? Here are some of the top exchanges available to U.S investors that offer plenty of cryptocurrency investments on their platform. Coinbase is giving away free crypto as part of their Coinbase Learn program, so if you’re looking to get paid for learning about blockchain technology, Coinbase is a great option for you!
Coinbase is one of the Internet’s largest cryptocurrency trading platforms. From Bitcoin to Litecoin or Basic Attention Token to Chainlink, Coinbase makes it exceptionally simple to buy and sell major cryptocurrency pairs.
You can even earn cryptocurrency rewards through Coinbase’s unique Coinbase Earn feature. More advanced traders will love the Coinbase Pro platform, which offers more order types and enhanced functionality.
Though Coinbase doesn’t offer the most affordable pricing or the lowest fees, its simple platform is easy enough for complete beginners to master in as little as a single trade.
- New cryptocurrency traders
- Cryptocurrency traders interested in major pairs
- Cryptocurrency traders interested in a simple platform
- Simple platform is easy to operate
- Comprehensive mobile app mirrors desktop functionality
- Coinbase Earn feature rewards you with crypto for learning about available coins
- Higher fees than competitors
Robinhood is the broker for traders who want a simple, easy-to-understand layout without all the bells and whistles other brokers offer. Though its trading options and account types are limited, even an absolute beginner can quickly master Robinhood’s intuitive and streamlined platform. On the other hand, more advanced traders might be frustrated by Robinhood’s lack of technical analysis tools, a feature that’s now nearly universal across other platforms.
- Fee-free trading
- Beginner crypto investors
- Doge day traders
- Commision-free trading
- Access to Dogecoin
- Limited altcoin selection
- No wallet capabilities
Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.
Webull is widely considered one of the best Robinhood alternatives.
- Active traders
- Intermediate traders
- No charges to open and maintain an account
- No account maintenance fees or software platform fees
- Intuitive trading platform with technical and fundamental analysis tools
- Only offers 14 coins
Voyager is a leading name in the sphere of cryptocurrency investing, giving you access to over 50 tokens and coins. Buy, sell and swap assets using Voyager Crypto’s simple mobile platform available as a free download for iOS and Android users.
When you invest through Voyager, you’ll pay nothing in commissions, which is a major benefit when compared to other cryptocurrency brokers. Voyager is also one of the only brokers we’ve seen that allows users to earn interest on their crypto investments.
Though the broker could do more to improve its customer service, it’s an excellent option for beginner investors and seasoned professionals alike.
- Cryptocurrency investors looking for a wide selection of supported projects.
- Investors who prefer mobile trading.
- Anyone interested in earning interest on their crypto investments.
- Simple, straightforward and intuitive mobile platform
- Wealth of investment opportunities
- Allows users to earn interest on select crypto investments
- Only available for mobile users — no desktop platform
- Limited routes to contact customer service team
Although we saw a large run up in cryptocurrency prices toward the beginning of 2021, we’ve remained relatively flat for most of the year. Bitcoin, which is a good indicator for the rest of the crypto markets, has traded between $35,000 and $60,000 for the majority of 2021. Most investors argue this will lead to more sustainable growth –– blow off tops and parabolic moves are rarely sustainable. For up to date cryptocurrency prices, check out our table below.
Is Bitcoin Cash Worth It?
Bitcoin Cash is still available on most of the same exchanges as Bitcoin and has been trading somewhat in lockstep with its big brother since the August 2017 hard fork. Bitcoin Cash is a speculative investment with many competitors looking to steal market share from it, and it’s performance in 2021 has been lack-luster at best. More likely than not, you can find higher returns from other digital assets currently available to trade on several large cryptocurrency exchanges.