5 Benefits of Cryptocurrency Trading

When it comes to trading cryptocurrencies, you need to anticipate whether the value of the market you choose will increase or decrease. And the interesting thing is that you never have a digital presence. In fact, trading is done with derivative products such as CFDs. Let’s look at the advantages of cryptocurrency trading. Read on for more information.

Variability

Although cryptocurrency is a new market, it is highly volatile due to short-term speculative interest. The price of Bitcoin fell from $ 19,378 in 2018 to $ 5,851 in just one year. However, the value of other digital currencies is very stable, which is good news.

What excites the world so much is the volatility of the value of cryptocurrency. Price movements offer many opportunities for traders. However, this also comes with many risks. Therefore, if you decide to research the market, make sure you do research and develop a risk management strategy.

Working hours

Typically, the market is open for trading 7/24 because it is not regulated by any government. In addition, transactions are carried out between buyers and sellers around the world. There may be short breaks when infrastructure upgrades occur.

Improved liquidity

Liquidity refers to how quickly digital currency can be sold for cash. This feature is important because it allows for faster operating times, better accuracy, and better pricing. In general, the market is a kind of illiquid because financial transactions take place on different exchanges. Therefore, small trades can bring big changes in prices.

Leverage exposure

Since CFD trading is considered a leverage, you can open a position called “margin”. In this case, the value of the deposit is part of the trading value. So you can make a big impact on the market without investing too much money.

Losses or gains will reflect the value of the position at the time of closing. Therefore, if you trade with a margin, you can make a big profit by investing a small amount of money. At the same time, it also increases the losses that can exceed your deposit in trading. Therefore, before investing in CFDs, make sure you consider the total cost of the position.

It is also important that you follow a strong risk management strategy that includes appropriate restrictions and stops.

Quick Account Opening

If you want to buy cryptocurrencies, make sure you do so through an exchange. All you have to do is sign up for an exchange account and keep the currency in your wallet. Keep in mind that this process can be restrictive and takes a lot of time and effort. However, once the account is created, the rest of the process will be fairly smooth and uncomplicated.

In short, these are one of the most notable benefits of cryptocurrency trading here and now. I hope you will find this article very useful.

Crypto Currencies Variability, A Profitable Rollercoaster

This year, we can see that cryptocurrencies tend to move up and down, even with 15% of the daily value. Such a change in price is known as volatility. What if … this is completely normal and sudden changes are a feature of cryptocurrencies that allow you to make good profits?

First of all, cryptocurrencies have recently become the mainstream, so all the news and rumors about them are “hot”. We are witnessing huge price movements after every statement by government officials about regulating or banning the cryptocurrency market.

Second, the nature of cryptocurrencies is more like a “storehouse of value” (as in the past with gold) – many investors see them as an option to invest in stocks, physical assets such as gold and physical currencies. The transfer rate also affects the volatility of the cryptocurrency. With the fastest ones, the transfer only takes a few seconds (up to a minute), which makes it an excellent asset for short-term trading, if there is currently no good trend in other assets.

What everyone should take into account – this speed also affects the life trends in cryptocurrencies. Trends in regular markets can last for months and even years – here they even happen over days or hours.

This takes us to the next point – although we are talking about a market worth hundreds of billions of dollars, the daily trading volume is very small compared to the traditional currency market or stocks. Therefore, a single investor trading 100 million shares on the stock exchange will not cause a big price change, but it is an important and noticeable transaction on the scale of the cryptocurrency market.

Because cryptocurrencies are digital assets, they are subject to technical and software updates of cryptocurrency features or the expansion of the blockchain, which makes them more attractive to potential investors (activation of SegWit basically doubles the value of Bitcoin).

Combining these elements, these are the reasons why we observe so many price changes in the price of cryptocurrencies in a matter of hours, days, weeks and hours.

But answering the question in the first paragraph – one of the classic rules of trading is to buy cheap, sell a lot – so having short but strong trends every day (instead of weak ones lasting weeks or months like stocks) gives a much better chance if used properly to make a profit.