Bitcoin trading can be extremely profitable for professionals or beginners. The market is new, highly fragmented with huge spreads. Arbitrage and margin trading are widely available. Therefore, many people can make money trading bitcoins.
Bitcoin’s history of bubbles and volatility has perhaps done more to bring in new users and investors than any other aspect of the crpytocurrency.
Each bitcoin bubble creates hype that puts Bitcoin’s name in the news. The media attention causes more to become interested, and the price rises until the hype fades.
Each time Bitcoin’s price rises, new investors and speculators want their share of profits. Because Bitcoin is global and easy to send anywhere, trading bitcoin is simple.
Compared to other financial instruments, Bitcoin trading has very little barrier to entry. If you already own bitcoins, you can start trading almost instantly. In many cases, verification isn’t even required in order to trade.
If you are interested in trading Bitcoin then there are many online trading companies offering this product usually as a contract for difference or CFD.
Avatrade offers 20 to 1 leverage and good trading conditions on its Bitcoin CFD trading program.
Why Trade Bitcoin?
Before we show you how to trade Bitcoin, it’s important to understand why Bitcoin trading is both exciting and unique.
Bitcoin Is Global
Bitcoin isn’t fiat currency, meaning its price isn’t directly related to the economy or policies of any single country. Throughout its history, Bitcoin’s price has reacted to a wide range of events, from China’s devaluation of the Yuan to Greek capital controls.
General economic uncertainty and panic has driven some of Bitcoin’s past price increases. Some claim, for example, that Cyprus’s capital controls brought attention to Bitcoin and caused the price to rise during the 2013 bubble.
Bitcoin Trades 24/7
Unlike stock markets, there are no official Bitcoin exchanges. Instead, there are hundreds of exchanges around the world that operate 24/7. Because there is no official Bitcoin exchange, there is also no official Bitcoin price. This can create arbitrage opportunities, but most of the time exchanges stay within the same general price range.
Bitcoin is Volatile
Bitcoin is known for its rapid and frequent price movements. Looking at this daily chart from the CoinDesk BPI, it’s easy to spot multiple days with swings of 5% or more:
Bitcoin’s volatility creates exciting opportunities for traders who can reap quick benefits at anytime.
Find an Exchange
As mentioned earlier, there is no official Bitcoin exchange. Users have many choices and should consider the following factors when deciding on an exchange:
Regulation & Trust – Is the exchange trustworthy? Could the exchange run away with customer funds?
Location – If you must deposit fiat currency, and exchange that accepts payments from your country is required.
Fees - What percent of each trade is charged?
Liquidity – Large traders will need a Bitcoin exchange with high liquidity and good market depth.
Based on the factors above, the following exchanges dominate the Bitcoin exchange market:
Bitfinex - Bitfinex is the world’s #1 Bitcoin exchange in terms of USD trading volume, with about 25,000 BTC traded per day. Customers can trade with no verification if cryptocurrency is used as the deposit method.
Bitstamp - Bitstamp was founded in 2011 making it one of Bitcoin’s oldest exchanges. It’s currently the world’s second largest exchange based on USD volume, with a little under 10,000 BTC traded per day.
OKCoin - Bitcoin exchange based in China but trades in USD.
Coinbase -
Coinbase - Coinbase Exchange was the first regulated Bitcoin exchange in the United States. With about 8,000 BTC traded daily, it’s the world’s 4th largest exchange based on USD volume.
Kraken - Kraken is the #1 exchange in terms of EUR trading volume at ~6,000 BTC per day. It’s currently a top-15 exchange in terms of USD volume.
In my next post i will be sharing a post on how to trade bitcoin.
stay tuned and don't forget the upvote.
Good post @owura. I just traded STEEM on bittrex at 2pips. The spread right now is 0.24. My profit from the trade was about $20, because I traded with about $400. Imgine if I were to be trading with $1000, then I would have made about $50. Trading is good, if the trader knows what he is doing. Thanks for sharing. Upvoted.
Thank you @maryfavour
You are welcome @owura!
Hi! I am a robot. I just upvoted you! I found similar content that readers might be interested in:
https://www.weusecoins.com/bitcoin-trading/
These crypto related stocks are less than 3 cents, for now. This I think fits into your discussion on the crypto markets and investing potential.
I have been sharing this info on something not widely known/talked about, crytpo related stocks. For me , just another opportunity to capitalize on this new and exciting paradigm. They are currently trading for pennies.
The stocks I think, give that still large segment of people who are not ready to learn about crytpos and exchanges, but have been on the sidelines hearing about all the excitement and gains, the opportunity to get on board this earth shaking crypto move, but within their own comfort zone by simply buying a stock that is related to bitcoin.
Most of these people already have a stock account they know how to use and in this way can participate easily. There are very few crypto stocks so these are already starting to skyrocket just in the last couple of days but may present an very unique opportunity. As a warning, there is not really a ton of info about them so use risk capital only!
I have put some money into them in just the last 1-2 days, already up significantly which means they may skyrocket further, or pull back hard, I do not think anybody can predict. Dollar cost averaging is probably the best way to enter at this point as they are just moving so fast now and price points could be anywhere next week. Anyways, I thought I would share, fwiw.
Here is a link with some of the info on 2 of the stocks crypto stocks that I just put together for myself and others as a starting point for due diligence.
https://steemit.com/bitcoin/@motowngold/global-arena-holding-inc-gahc-another-rare-bitcoin-and-blockchain-stock
Solid post. Same mindset here. There's a lot of exchanges out there. I found that coinmarketcap.com gives quite a decent overview. Besides coinmarketcap.com there is: https://www.coincheckup.com I'm really enthusiastic about this site, they let you analyze every single coin out there. Check for example: https://www.coincheckup.com/coins/Bitcoin#analysis To see the: Bitcoin Detailed analysis