What Is Bitcoin Cash?
Bitcoin (BTC) has officially split. In what is called a “hard fork,” the most famous and largest cryptocurrency by market cap has spawned an entirely new and competing virtual coin called Bitcoin Cash (BCH). Many investors are stuck asking “What is Bitcoin Cash?” and are wondering how to get Bitcoin Cash or how to buy Bitcoin Cash. Lucky for you, it’s not all that complicated.
Bitcoin Cash split off from Bitcoin much for the same reason we often see these types of splits in the cryptocurrency world: an ideological divide.
Much like we saw with the split between Ethereum (ETH) and Ethereum Classic (ETC), a vocal minority had issues with a number of Bitcoin practices and decided that the best way to overcome those differences was to split off from BTC and create its own cryptocurrency.
This has created renewed excitement in an already-frothy market, and, as a result, it has sent a wave of sorts running through the cryptocurrency trade, affecting the BTC price in its wake.
(Data source: “CryptoCurrency Market Capitalizations,” CoinMarketCap, last accessed August 2.)
How to Get Bitcoin Cash
So now that we have a basic overview of what is Bitcoin Cash, the next obvious questions for investors are how to get Bitcoin Cash and how to buy Bitcoin Cash.
First, let’s take a look at a number of people who may be eligible to receive Bitcoin Cash without even purchasing the coin.
Coin owners who control their own private keys for regular BTC can use those same keys to access and spend BCH.
If you do own Bitcoin but don’t control the keys, then the next step is looking into the policy of the wallet or platform where you’ve stored your coins. If it’s Bitcoin Cash-friendly, then congratulations—you are now the proud owner of some BCH coins.
How to buy Bitcoin Cash is similarly a case-by-case basis at the moment. Some exchanges are fine accepting the newly-minted cryptocurrency, while others have stated that they will not accept the new coins.
Coinbase, the world’s most popular cryptocurrency exchange, has rejected BCH, so you won’t be able to use that particular service if you want to invest in BCH.
Others, like Bitfinex, have said they will continue monitoring the situation and will determine later whether they will accept BCH. (Source: “Bitcoin falls, new ‘bitcoin cash’ briefly leaps nearly 50% then dives as digital currency splits,” CNBC, August 1, 2017.)
Basically, it’s your run-of-the-mill uncertainty that any investor who’s played for any length of time in the cryptocurrency market should be used to by now. To be fair, a Bitcoin split beats the hell out of a massive hack or any other catastrophic development like that, so, while a Bitcoin Cash exchange may not be as easy to find as other cryptocurrency exchanges, it’s a rather small hurdle to overcome for those interested in BCH.
How to Buy Bitcoin Cash
We’ve established how to get Bitcoin Cash and how to find a Bitcoin Cash exchange, but now I’d like to look at how to manage Bitcoin Cash futures. While Bitcoin Cash mining may work for some, many will still prefer to ride the highs and lows of the cryptocurrency market via investments.
Following the Bitcoin Cash fork, we saw a wild swing in the value of BCH, hitting a high of $400.00 before crashing down to around $200.00, but then rebounding back up to $400.00. Again, these are not unusual swings in the cryptocurrency market.
As it stands, the Bitcoin price is right now the best predictor of BCH value, similar to the way that ETC has largely mirrored ETH.
With the Bitcoin split being so fresh, BTC and BCH are still quite similar in terms of projections. As time goes on, a greater divide will grow between the two and create further separation. But, for now, expect BCH to closely match the gains and losses of BTC for the near term.