As the world’s initial cryptocurrency, many investors see Bitcoin as the most likely candidate for a serious challenge to traditional currencies. In view of the observed price development, the volatility seems rather difficult to evaluate.
You can trade with Bitcoin with these steps:
- Choose how you want to invest in Bitcoin
- Get to know the factors that influence the Bitcoin price
- Choose a trading strategy
- Place your first trade
The Different Ways to Trade Bitcoin
There are two ways to get bitcoin: buy the actual cryptocurrency (here is how to trade cryptocurrency), hoping to sell it profitably, or speculate on performance without ever having the token. The latter can be attained by CFDs.
In a CFD, you trade an agreement based on the prices of the prime market. This leverage product makes it possible to move much higher market positions with less capital outlay. This can multiply both your profits and losses.
Is Stock Exchange Needed to Trade Bitcoin?
When you trade bitcoin, you don’t transact directly with a stock exchange but trading prices, which stock brokers obtain from several stock exchanges for you. You just need to open a bitcoin position in an IG trading account.
Bitcoin exchanges work just like traditional exchanges and allow investors to trade each other’s cryptocurrency. There are, however, some advantages to simply omitting them:
They are not well regulated, there aren’t enough public records, and the infrastructure to respond quickly to inquiries is also inadequate.
The matching engines and servers are unreliable, which can lead to market suspension or reduced execution accuracy.
Stocks and withdrawals through stock market accounts are often associated with fees or restrictions, and the purchase of an account can often take days
When you trade bitcoin, you get far better liquidity for your desired touch price. However, if you are buying or selling directly on the stock exchange, you will normally have to accept multiple prices to complete your order.