If you have been following up on cryptocurrencies, then you know that they are, in a nutshell, digital currency. This means you will not find it in a folded bill in your wallet as you would a dollar. Also, cryptocurrency is not monitored by banks or financial authorities like fiat money is.
Digital currency was introduced to the public in 2009 when Bitcoin was launched. Other started making an appearance as many as two years later encouraged by Bitcoin’s success. Some of the major cryptos you will come across in CFD trading include the following:
Ethereum is the closest rival to Bitcoin. In the market, cryptocurrencies are quoted against the US Dollar and the Euro (USD and EUR respectively. Their codes against the two major currencies look like this:
Investors have started considering cryptocurrencies as a viable investment. Their interest is mostly as a result of headlines and articles detailing Bitcoin’s rise in value. In 2017, Bitcoin was valued under $1,000 at the beginning of the year. This value rose expeditiously to over $14,000 by the end of the same year.
When entities such as CBOE and CME started launching their future contracts in Bitcoin, investors sat up and took notice. Many people who have dabbled in cryptocurrencies simply buy the actual digital currency. The drawbacks to this include the following:
To avoid these drawbacks, it is more advisable to trade cryptocurrencies via CFDs. These offer you fast processing times. The time factor is crucial in a market as erratic as the CFD market.
It is important to note that the Bitcoin market is one of the most erratic. It can be triggered by an announcement in financial news and either shoot sky-high or plummet to the doldrums. Different traders will view this in a variety of ways depending on a wide variety of factors.
Also Read: 3 Top BitCoin Trading Software
Some will tread with caution. Others will see the volatility as the perfect chance to short the price and await further falls. Yet another group of traders will see this as an excellent trading opportunity. Naturally, the ball is in your court.
Trading in the other cryptocurrencies will more or less follow the same trend. You must do your homework with regard to any of the cryptos you want to trade. The results of your research will inform your decision in picking one currency over the other.
Nevertheless, as with any form of trading, it is important to learn the ways and arm yourself with sufficient information. Also, keep a keen eye on the movements in your account to take full advantage of the markets.
- Ethereum (Ether)
- Bitcoin Cash
- Litecoin
- Ripple
Ethereum is the closest rival to Bitcoin. In the market, cryptocurrencies are quoted against the US Dollar and the Euro (USD and EUR respectively. Their codes against the two major currencies look like this:
- Bitcoin vs the Dollar: BTC/USD
- Bitcoin vs the Euro: BTC/EUR
- Ethereum vs the Dollar: ETH/USD
- Ethereum vs the Euro: ETH/EUR
- Litecoin vs the Dollar: LTC/USD
- Litecoin vs the Euro: LTC/ EUR
- Ripple vs the Dollar: XRP/USD
- Ripple vs the Euro: XRP/EUR
Reasons to Trade CFDs on Cryptocurrencies
With the blockchain technology, it is possible to access cryptos. Blockchain is the public register that contains a record of all undertaking.Investors have started considering cryptocurrencies as a viable investment. Their interest is mostly as a result of headlines and articles detailing Bitcoin’s rise in value. In 2017, Bitcoin was valued under $1,000 at the beginning of the year. This value rose expeditiously to over $14,000 by the end of the same year.
When entities such as CBOE and CME started launching their future contracts in Bitcoin, investors sat up and took notice. Many people who have dabbled in cryptocurrencies simply buy the actual digital currency. The drawbacks to this include the following:
- They are not regulated
- Processing times are slow
- There have been documented concerns about the cryptos being compromised
To avoid these drawbacks, it is more advisable to trade cryptocurrencies via CFDs. These offer you fast processing times. The time factor is crucial in a market as erratic as the CFD market.
Trading Bitcoin in CFDs
Being the first and most recognized cryptocurrency, it comes as no surprise that is the most talked about. There are two ways you can trade Bitcoin in CFDs:- Buy the crypto and store it in a Bitcoin wallet. Later, when its value has risen, you can sell it for a profit.
- Trade BTC/USD via CFDs. This only requires you to open a live trading account with a trusted and reputable platform such as Saxo Markets. You can then trade easily from a chart.
It is important to note that the Bitcoin market is one of the most erratic. It can be triggered by an announcement in financial news and either shoot sky-high or plummet to the doldrums. Different traders will view this in a variety of ways depending on a wide variety of factors.
Also Read: 3 Top BitCoin Trading Software
Some will tread with caution. Others will see the volatility as the perfect chance to short the price and await further falls. Yet another group of traders will see this as an excellent trading opportunity. Naturally, the ball is in your court.
Trading in the other cryptocurrencies will more or less follow the same trend. You must do your homework with regard to any of the cryptos you want to trade. The results of your research will inform your decision in picking one currency over the other.
Conclusion
Ultimately, trading cryptocurrency is yet another currency; only that this one is digital. Many investors view it as the future of currency. An HK-based CFD trader can trade in this as effectively as safely as the one in Australia can.Nevertheless, as with any form of trading, it is important to learn the ways and arm yourself with sufficient information. Also, keep a keen eye on the movements in your account to take full advantage of the markets.
Ashutosh Jha
Ashutosh Jha is a professional blogger, Blog and IT Consultant. He writes about Blogging, SEO, Making Money, Internet Marketing and Web Design.
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