Bitcoin Cash Trading
Day trading Bitcoin Cash is on the rise. This review explains what Bitcoin Cash (BCH) is and how to start trading the popular crypto in 2023. We also cover suitable trading strategies, potential risks, future price predictions, and the best Bitcoin Cash brokers.
Bitcoin Cash Brokers
#1 - eToro USA
eToro US leads the way in cryptocurrency trading. 1% fee for buying or selling crypto added to the spread (from 0.75% for BTC), with their own wallet service and the largest number of cryptos to trade in the market. eToro copy trading is only for cryptos. Crypto asset investing is highly volatile and unregulated. No consumer protection. Tax on profits may apply.
"eToro is a top pick for traders looking for social investing and copy trading. With a low deposit, zero commissions and an intuitive platform, the broker will meet the needs of newer traders."
- DayTrading Review Team
- Crypto Spread: BTC 0.75%
- Crypto Lending: No
- Platforms: Own
- Crypto Staking: No
- Minimum Deposit: $10
- Regulator: SEC, FINRA
About eToro USA
eToro is a social investing platform that offers stocks, ETFs, options, and crypto. The broker is well-known for its user-friendly community-centred platform and competitive fees. With FINRA and SIPC oversight and millions of users across the world, this brand is highly respected. eToro securities trading is offered by eToro USA Securities, Inc.
Pros
- eToro USA Securities is a trustworthy, SEC-regulated broker that is a member of FINRA and SIPC
- A free demo account means new users and prospective traders can try the broker risk-free
- The online broker offers an intuitive social investment network with straightforward copy trading on cryptos
Cons
- Average fees may cut into the profit margins of day traders
- Narrower range of instruments than some competitors
- No MetaTrader 4 platform integration
#2 - NinjaTrader
Trade micro Bitcoin futures with low fees and leading charting tools. Get exposure to Bitcoin through CME Group's centralized exchange with robust risk management tools.
"NinjaTrader is well-positioned to meet the demands of active futures traders looking for low fees and premium analysis tools. The platform hosts top-rate charting features with custom indicators. "
- DayTrading Review Team
- Crypto Spread: Floating
- Crypto Lending: No
- Platforms: NinjaTrader Futures, eSignal
- Crypto Staking: No
- Minimum Deposit: $50
- Regulator: NFA, CFTC
About NinjaTrader
NinjaTrader is a US-headquartered and regulated brokerage that specializes in futures trading. There are three pricing plans to suit different needs and budgets, as well as ultra-low margins on popular contracts. The brand's award-winning charting software and trading platform also offers a high-degree of customization and superb technical analysis features.
Pros
- Thousands of add-ons and applications from developers in 150+ countries
- Industry-leading futures broker with multiple awards
- Widely respected and heavily authorized by the NFA and CFTC
Cons
- Non forex and futures trading requires signing up with partner brokers
- Premium platform tools come with an extra charge
- Withdrawal fee on some funding methods
#3 - Interactive Brokers
Buy and hold Bitcoin, Bitcoin Cash, Ethereum and Litecoin with low commissions of 0.12%–0.18%. Fees are low and the broker offers a secure environment to invest in digital assets.
"Experienced day traders seeking a regulated broker with sophisticated trading software and very low fees should look at IB. Their range of stocks also can't be beaten."
- DayTrading Review Team
- Crypto Spread: Variable
- Crypto Lending: No
- Platforms: AlgoTrader, OmniTrader, eSignal, TradingCentral
- Crypto Staking: No
- Minimum Deposit: $0
- Regulator: SEC, FCA, IIROC, SFC
About Interactive Brokers
Interactive Brokers is a leading global brokerage that provides access to a comprehensive offering of stocks as well as forex, futures, metals, bonds and cryptos. The firm has over 40 years experience in the online trading industry and is heavily regulated by SEC, FCA, IIROC, and SFC. Day traders can use the proprietary Trader Workstation and can access powerful tools and data feeds as well as comprehensive educational resources.
Pros
- Low commissions and tight spreads
- Direct market access, including to the FTSE 100 index, the CAC 40 and Germany’s DAX 40
- Commission reimbursement with Toggle AI
Cons
- Accessing products like CFDs is not straightforward compared to competitors
- Platform and web interface are complex and difficult for beginners to pick up
- Due to the pricing structure, this firm can be more expensive for aggressive traders who trade over $100,000 shares a day
#4 - OANDA US
Speculate on the world's biggest cryptos by market cap. Commissions are lower than many peers starting at 0.25%. Clients can spot trade cryptocurrencies on Paxos's itBit exchange through the OANDA platform via OANDA’s partnership with Paxos. Users can trade digital currencies in a few taps through the iOS and Android mobile app.
"OANDA is an excellent broker for US day traders seeking a user-friendly platform with premium analysis tools and a straightforward joining process. OANDA is also heavily regulated with a very high trust score."
- DayTrading Review Team
- Crypto Spread: $100
- Crypto Lending: No
- Platforms: MT4, TradingView, AutoChartist
- Crypto Staking: No
- Minimum Deposit: $0
- Regulator: NFA, CFTC
About OANDA US
OANDA is a popular brand offering exceptional execution, low deposit requirements and advanced charting and trading platform features. The top-rated brand has over 25 years of experience and is regulated by trusted agencies, including the NFA/CFTC. Around the clock support is available, alongside flexible contract sizes and automated trade executions.
Pros
- Low minimum deposit for beginners
- US clients accepted
- Industry-leading charting platforms including MT4 and TradingView
Cons
- Customer support not available on the weekend
#5 - IG Group
11 popular cryptos are available, plus two crypto crosses. A crypto index is also offered, following the value of the top 10 digital currencies by market cap. All cryptos are available via CFDs.
"IG offers a superb all-round package. Beginners will appreciate the user-friendly web platform and secure trading environment while established investors will rate the 17,000+ markets and top-tier market research."
- DayTrading Review Team
- Crypto Spread: Variable
- Crypto Lending: No
- Platforms: MT4, AutoChartist, TradingCentral
- Crypto Staking: No
- Minimum Deposit: $0
- Regulator: FCA, ASIC, NFA, CFTC, DFSA, BaFin, MAS, FSCA
About IG Group
IG is an award-winning broker that has an excellent reputation globally. The brand-US offers spread betting, CFD and forex trading across a comprehensive suite of markets. IG is also multi-regulated, provides a great trading app and has 50 years experience.
Pros
- IG offers great educational materials including an extensive library of training and support on how to day trade successfully
- 24/5 customer support is available
- Users have access to a comprehensive range of charts, market news, client sentiment data, and analysis tools
Cons
- No copy trading platform
- Inactivity charge
Bitcoin Cash Explained
Bitcoin Cash is a popular cryptocurrency with the symbol ‘BCH’. It was created in August 2017 as a hard fork of Bitcoin (BTC). Bitcoin was forked to develop important updates that allowed for effective scalability. This was needed because the speed of transactions on the Bitcoin network was slow, concerning coin miners and developers about the ability for mass adoption. The Bitcoin Cash fork was created by updating Bitcoin’s blockchain code with a few modifications.
Bitcoin Cash is also a payment network and medium of exchange that allows for 24/7 peer-to-peer transactions.
Bitcoin Cash runs on its own blockchain technology. Blockchain is a decentralised digital ledger, which permanently records transactions and can be viewed by anyone. For decentralisation to occur, it requires nodes (computers) to verify transactions by miners who use computing power to solve mathematical equations on the blockchain. Afterwards, 1 Bitcoin Cash coin is mined.
Just like BTC, BCH is capped to a limited supply of 21 million coins. However, BCH is distinguished from BTC as it has an increased block size of 32 MB vs BTC’s 1 MB. This means more transactions can be handled in a single block, which in turn creates shorter waiting times and lower transaction processing fees.
History Of Bitcoin Cash
In 2008, Satoshi Nakamoto published the famous whitepaper called “Bitcoin: A Peer to Peer Electronic Cash System”. The original Bitcoin software ran smoothly until it became increasingly unreliable and expensive between 2016 and 2017. Members of the Bitcoin community felt that the limited block size would leave the crypto as an investment vehicle rather than a transactional currency and medium of exchange. As a result of usability problems, the dominance of Bitcoin dropped from 95% to 40%.
During the controversy, the Bitcoin community could not reach a consensus on a scalable but compatible coin. Thus, came the official launch date of Bitcoin Cash on 1 August 2017. A group of crypto activists, investors, entrepreneurs and developers created a hard fork, splitting the Bitcoin ledger and Bitcoin Cash in two. Bitcoin Cash’s block size was initially 8 MB but was later increased to 32 MB in 2018. Anyone who held the original Bitcoin at the time it was forked automatically got the matching value of BCH to 1 BTC.
According to CoinGecko, Bitcoin jumped to an all-time high of $3,785.82 soon after the fork in December 2017. As Bitcoin Cash is designed to be a medium of exchange, its historical price is more stable compared to Bitcoin. Nonetheless, with the volatile nature of cryptocurrencies, it’s hard to create long-term forecasts or price predictions for 2023 or 2025, let alone 2030.
Bitcoin Cash Trading Chart
Why Trade Bitcoin Cash
- Low transaction fees – The Bitcoin Cash blockchain operates with larger blocks vs Bitcoin. This means more transactions can fit into a single block of up to 32 MB. In turn, this creates less demand for users to get transactions into the next block, creating fewer outbidding wars with higher fees. The network fee for a typical transaction is around $0.20. If you wish to convert BCH into a fiat currency i.e. USD, the costs are still lower than credit card processing.
- Quick transaction times – Due to larger block sizes, the Bitcoin Cash blockchain is capable of higher transaction outputs per second. Bitcoin can perform around 7 transactions per second, while Bitcoin Cash can perform as many as 24 transactions per second.
- Growing cryptocurrency – Bitcoin Cash was the most popular Bitcoin fork at the time. Additionally, many Bitcoin owners were automatically credited with equivalent Bitcoin Cash. The instant prominence of BCH meant that many popular exchanges and platforms offered the coin. In fact, Bitcoin Cash has a rapidly growing trading volume of $5.94B and a market cap of $14.1B.
Risks Of Trading Bitcoin Cash
Before investing your savings into Bitcoin Cash, you should be aware of the potential drawbacks:
- Dangers of volatility – While day traders can certainly profit from the volatile price swings of BCH, users should ensure that they only risk the amount of money that they’re willing to lose. Generally, it is advised never to invest more than 1% of your account value on a single trade.
- Unpredictable future – Bitcoin Cash and cryptocurrencies, in general, are an emerging market. This makes their future somewhat uncertain. We still don’t know how governments will react or whether they will choose to impose regulations. Governments from all around the world are already drafting up legislation on the supervision of cryptos. These regulations could impede the whole philosophy of decentralisation.
- Security – Unlike Bitcoin, there is a smaller development team with less experience supporting Bitcoin Cash. The slower development of security features may leave the network exposed to attacks. In 2019, there were security concerns around a miner controlling 51% of the network’s hash rate. If one person or group has majority control, they can effectively control the entire network. At the time, BCH developers simply recommended avoiding transacting on or with BCH until it was resolved.
Bitcoin Cash Trading Strategies
Utilising Volatility
Compared to stocks that don’t see as much price change in one day, day traders can profit from the wild Bitcoin Cash price swings that can occur in a 24-hour period. Historical prices of Bitcoin Cash shows that it has fluctuated up to 20% in a single day. Traders can buy into the market when starting prices are low and cash out when the price is at its highest. However, this strategy brings risks. Thus, it’s important to look at data that can signal volatility and to plot entry and exit points on your trading graphs.
Scalping
Scalpers profit from small moves that add up over time. Instead of holding, they exploit gaps in liquidity and profit off bid-ask spreads or inefficiencies in the market. It is common to see scalp traders entering and exiting a trade in a matter of seconds while using automated bots to increase the frequency of their trades. Scalping strategies are ideal in markets with higher liquidity like BCH. It is also suited to advanced traders with a deep understanding of the mechanics of the market.
Arbitrage
Arbitrage traders get money from buying BCH in one market for a lower price and selling it at a higher price on another exchange. The idea is to profit from the difference in listing prices on both platforms. The price difference can stem from the discrepancy of trading volumes between exchanges. However, individuals employing this Bitcoin Cash trading strategy must consider total exchange fees, as it might cancel out any profits made from the sale.
Technical Analysis
Day traders can get an edge using technical analysis. This is done by making market decisions based on live price charts or using historical market data to project future price movements. Candlestick charts, support and resistance levels, trend lines and others are essential tools that can aid technical analysis. Utilising this strategy with BCH can seem daunting at first, however, you can test your strategies on a demo account to get familiar with different charts and patterns.
How To Trade Bitcoin Cash
To start trading Bitcoin Cash, you need to buy BCH first:
- Crypto wallet – Purchasing BCH works similarly to any other cryptocurrency. Firstly, you need to get an e-wallet, where you can buy coins using a debit or credit card. When setting up your wallet, take note of the secret key and wallet address and keep it secure. You will need this to access your wallet and make deposits and withdrawals on exchanges.
- Trading exchange – You can also buy BCH with fiat currency, such as GBP, EUR or USD directly from exchanges. Trusted platforms that offer BCH include Coinbase, Binance, eToro and Revolut. If you own other cryptocurrencies, you can use these platforms to exchange them for BCH too.
- Withdrawal – Once you are ready to cash out your earnings, you can withdraw BCH to your wallet. If you leave it on the exchange platform, you may be exposed to security vulnerabilities. This is because the company has control over the private keys, which means your funds aren’t protected if there is an attack on their network. With a BCH wallet, you have full control of the private keys.
Final Word On Trading Bitcoin Cash
Bitcoin Cash’s disruptive upgrades to fill the gaps in Bitcoin have proven popular in recent years. While its future is still uncertain, there are many opportunities for day traders to earn fruitful profits. Make sure to utilise smart strategies, trading tools and keep up with the latest Bitcoin Cash news to gain an edge.
FAQ
Is Bitcoin Cash An Altcoin And What Is It?
Bitcoin Cash is a type of cryptocurrency and a peer-to-peer payment network. Bitcoin Cash is one of the many altcoins to Bitcoin. It is a hard fork that split from the original Bitcoin blockchain and was launched in August 2017 as a solution to BTC’s scalability issues. Bitcoin Cash runs on its own blockchain ledger.
Is Bitcoin Cash A Good Investment For 2021?
As the cryptocurrency market has rapidly grown, many argue now is a good time to invest in Bitcoin Cash. It is a top 10 cryptocurrency by market cap experiencing significant growth in trading volumes. Thus, the price of Bitcoin Cash may continue to climb. With that said, crypto trading is extremely volatile with no guarantee of profits. Appropriate risk management parameters should be put in place.
Why Is Bitcoin Cash Better Than Bitcoin?
Bitcoin Cash has several advantages over Bitcoin. Bitcoin Cash works more effectively as a decentralised transactional currency, which was the initial objective of Bitcoin. Bitcoin Cash has a larger block size of up to 32 MB vs Bitcoin’s 1 MB. This allows for higher transaction capacity, lower fees and faster processing times. Furthermore, Bitcoin Cash is less volatile than Bitcoin.
What Is A Bitcoin Cash Card And Wallet Address?
A Bitcoin Cash e-wallet allows you to buy BCH with fiat currency. It also securely stores your BCH coins, giving you access to private keys. A wallet address is a unique selection of numbers that enables you to receive payments and make deposits. Commonly, a QR code for the wallet address is also provided.
Is Bitcoin Cash Rising Or Going Down?
Because of the volatile nature of Bitcoin Cash, its price is frequently rising and dropping. Therefore, it is hard to make an accurate prediction of its future worth. You can make use of live price charts, historical data and news sources to estimate its value in the future.