How Bitcoin Cash processes transactions step by step
Bitcoin Cash transactions are signed in a wallet, broadcast to nodes, and mined into blocks. First confirmation usually comes in 10 to 60 minutes.
Vahe HakobyanEditor-in-chief
Updated Oct 6, 20263 min readFact-checked
On this page
- A wallet signs each Bitcoin Cash payment with a private key.
- A payment is not final until it has a confirmation.
- Keep date, amount, and US dollar value for taxes.
- Bitcoin Cash and bitcoin have different block limits.
You start with a Bitcoin Cash wallet and a receiving address from the person you are paying.
What is the Bitcoin Cash transaction process
A Bitcoin Cash transaction passes through four stages: your wallet creates and signs it, nodes verify it, and miners place valid transactions into blocks. Bitcoin Cash forked from bitcoin in August 2017, with different block limits and fee markets.
What you need before you start
Before you send Bitcoin Cash, you need a Bitcoin Cash wallet and a receiving address. Your wallet calculates your spendable balance from confirmed transactions.
How does a transaction move through the network
A payment moves from your wallet to a block that confirms it. Your wallet signs the transaction before it leaves your device.
- 1Enter payment detailsOpen your Bitcoin Cash wallet, paste the address, and type the amount. Check the address characters and confirm the Bitcoin Cash network.
- 2Review and signRead the address and amount again. Your wallet signs with your private key, which prevents later alteration.
- 3Broadcast the transactionYour wallet sends the signed transaction to nodes. They check the signature, your balance, and network rules before relaying it.
- 4Wait for a blockMiners include valid transactions in a block that gives the first confirmation, usually within about 10 to 60 minutes.
What to do after sending Bitcoin Cash
After you broadcast, your wallet may show the transaction as pending. A payment is not final until it has confirmations, and you need tax records.
- Track the transaction ID in your wallet or a block explorer.
- Save the date, amount, and US dollar value at the time of the transaction.
- The IRS treats crypto as property: buying with US dollars is not taxable, but trading one crypto for another or paying with crypto can be taxable.
Frequently asked questions
A first confirmation usually comes within about 10 to 60 minutes. Network conditions can change that timing.
It may wait unconfirmed or be dropped by nodes; many wallets can rebroadcast it later. A zero-confirmation payment can be double-spent before mining.
Once confirmed, wallet support cannot reverse it. An unconfirmed transaction might be replaced only in limited cases.
No. A regular wallet is enough to send and receive. A full node is not required for a payment.
