Quick summary: Our recommendation is to use eToro to short Bitcoin Cash. They have the most popular cryptocurrencies on offer, great support, and have an easy system for shorting cryptocurrencies in general.
While there are a lot of options out there for buying BCH, shorting is a different story. Luckily for us here in Australia, we do have a few crypto brokers and exchanges that allow for CFDs and shorting.
One of those brokers is eToro, which we’ll be using for this guide. Let’s get started!
How to Short Bitcoin Cash in Australia
A quick recap first on what shorting actually is: The main objective of shorting or short selling is to make a profit (of course). The idea is to sell a stock/cryptocurrency hoping it will drop in value so you can buy it back later for cheaper, thus creating a net profit.
Shorting Bitcoin Cash can be done in 4 easy steps:
1. Choose a cryptocurrency exchange
As mentioned before, for this guide we’ll be using eToro as they offer the ability to short the most common cryptocurrencies.
You can, of course, use any other crypto broker to follow along, they all work very similarly.
2. Create an account on the crypto trading platform
Let’s start with just signing up with eToro.
The sign-up process is very easy and quick, as is the verification that needs to be completed afterwards so you can get started.
3. Funding your eToro account
Next is funding your account. You have several options when it comes to depositing AUD into your eToro Account. These include a bank transfer, credit card, debit card, PayPal, and more.
4. Short Bitcoin Cash
Now for the actual shorting:
- Starting off at the search bar at the top, find Bitcoin Cash by entering the name or symbol.
- Then on the crypto page/section, on the right side, hit the TRADE button to enter the trading interface.
- At the top of the trading interface: Click on sell to short sell the stock.
- Enter the amount for which you want to sell Bitcoin Cash and click on “Open Trade”.
Once you’re ready to close the trade, hopefully when the value of Bitcoin Cash has dropped, go to your Portfolio, find the Bitcoin Cash trade, and click on the red cross to close the trade.
If your assumption/prediction was right, then the profit will be added to your account after closing the trade. If you were wrong on the other hand, you’ll incur a loss which will be debited from your eToro account.
Congratulations, now you know how to short Bitcoin Cash!
Disclaimer: Trading, investing, and dealing with digital and cryptocurrencies might involve a lot of risks. Their prices are volatile and performance is unpredictable. Their past performance is no guarantee of future performance.
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Where to Short Bitcoin Cash (BCH)
Aside from eToro, the other major exchange you can use is Binance.
While Binance tends to be a bit more complex compared to eToro, they do have more cryptocurrencies on offer.
Frequently Asked Questions
Can I short Bitcoin Cash on Binance?
Yes, you can short Bitcoin Cash on Binance. They have over 300 cryptocurrencies on offer and specialise in the crypto market. They also have a great app and competitive fees.
About Bitcoin Cash
Bitcoin Cash (BCH), is a type of cryptocurrency similar to Bitcoin. Bitcoin Cash is actually a fork made from Bitcoin. This was the result of a chain splitting when some Bitcoin developers became unhappy with Bitcoin’s overall scalability direction.
By another hard fork, the Bitcoin Cash community would split into Bitcoin Cash (Bitcoin Cash) in November 2018. Calvin Ayre and Craig Wright supported this group. They proposed a new software version, Bitcoin Satoshi Vision, that would raise the block size limit to 128MB.
On November 15th 2020, Bitcoin Cash was hit with another hard fork. Bitcoin Cash ABC (BCHA), was created by the block #661647 fork. Bitcoin Cash ABC's network also includes a miners’ tax. This means that 8% of the mining reward will be distributed to BCHA developers as funding for protocol design.
It can be summarized that the Bitcoin Cash developers initially were dissatisfied about the decisions made concerning Bitcoin's growth. They were particularly dissatisfied with the implementation Segregated Witness (SegWit) SegWit is believed to be a compromise in the decentralization process of Bitcoin Cash. They suggested that the network could have increased block size to allow Bitcoin to grow. These people came up with a plan to separate from the Bitcoin blockchain. They created Bitcoin Cash with an 8 MB block limit. Bitcoin proceeded with their plan to implement SegWit. However, the newly forked Bitcoin Cash failed to implement SegWit. On May 15, 2018, the Bitcoin Cash block limit was raised from 8 MB up to 32MB.
Bitcoin Cash witnessed a chain split within its community on November 15, 2018, which led to the creation Bitcoin SV. Bitcoin SV was created by Bitcoin Cash's creators. They felt that Bitcoin Cash wasn't following the original vision of Bitcoin Whitepaper and decided they would split to create their own currency.
Bitcoin Cash is a product of a Bitcoin Cash split. It shares many of Bitcoin Cash's fundamental functions. They actually share the same history.
Because it is a fork, all bitcoin-related data before the split can be inherited. You now have 1 BTC or 1 BCH if you had 1 bitcoin prior to the creation of Bitcoin Cash. Both can be signed with the same private keys.
Bitcoin Cash and Bitcoin Cash cannot be interoperable. Bitcoin Cash can't be sent to the Bitcoin network, but you can own 2 BTC. Your bitcoin cash or bitcoin are now on two separate blockchains.
Bitcoin Cash and Bitcoin Cash differ in that they have different block sizes and fees. Bitcoin Cash can send Bitcoin Cash faster and costs less than Bitcoin Cash. Bitcoin Cash advocates believe that Bitcoin Cash can be a faster, more efficient digital currency.