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Trading Instruments

Cryptocurrency CFD Trading

Not that long ago, cryptocurrencies were a thing of science fiction.

It Made a Boom, But How Can You Use That to Your Advantage?

Not that long ago, cryptocurrencies were a thing of science fiction. However, in recent years (and thanks to the constant rise of specific currencies), crypto slowly but surely became a part of everyday life. 

Therefore, it’s no surprise that it gets traded. Just like any other currency! 

How to Start

What is CFD Cryptocurrency Trading?

Like with any other currency trading, with CFD cryptocurrency trading, traders speculate on how the price will move. If they think it will go up, they buy, and if they think it will go down, they sell. The bullish or bearish approach work just like with any other exchange trading.

Generally speaking, there are two ways of trading crypto. You can trade with an CFD or you can use the exchange system to actually buy or sell the coins. 

What is CFD Cryptocurrency Trading?

You can’t go into crypto trading willy-nilly. Before you deposit any money or make decisions, you need to know what can determine your fate. 

So, get acquainted with: 

  • the factors that influence the market movement and that could affect the price 
  • what others are doing (in other words figure out which cryptos are safe bets based on their popularity)
  • the lingo (learn the terminology and what it means for you).

What Moves the Cryptocurrency Markets?

We all know what Moves the Forex and stock markets (economy, huge world-wide changes, etc.). However, those factors have nothing to do with the change in price of cryptos. 

Instead, we need to pay attention to: 

  • News about new regulations (that might limit some cryptos thus tanking their price or vice versa)
  • Crypto communities – disagreements with the community that lead to exgchay attacks can also influence the price
  • New projects

It’s also important to be aware of the supply of a specific currency as well as its value on the market. Some cryptos are more popular than others which gives them a better image (and image influences the price) while others have great applicability so their popularity rises. 


What Are the Most Traded Cryptocurrencies?

With over 1600 cryptos available for trading, it’s no wonder you can’t pick. However, some are sure bets (or at least are popular).
Bitcoin and Ethereum are still the two most popular cryptos and, even though many cryptos try to get in their level of popularity, most fail. 
Ripple XRP, IOTA, Litecoin and NEO are also quite popular. 

Cryptocurrency Trading

Common Crypto CFD Terminology

The terminology doesn’t differ from standard trading. Going long means that you’re anticipating a rise in the price so you’re buying shares. Going short means the opposite. Similarly, leverage, margin, ask, and bid price all have the same meanings as they do with other trading options. 

What are the Benefits of Trading Crypto CFDs?

Cryptocurrency CFD trading has plenty of benefits. Cryptos changed and continue to change the financial market which means they are a potential gateway to huge profits. But why are CFDs the way to go?

  • You don’t need a digital wallet (since you don’t actually own the underlying asset)
  • They are a low security threat
  • There’s high volatility and rapid movements – the crypto field is continually evolving and every change brings a fluctuation in prices. That’s why crypto trading is ideal for those looking for short-term outcomes and rapid movements. 
  • Continuous Trading – the trading doesn’t stop because it isn’t ties to a specific market.
  • Speculating on price movement – prices change quickly and frequently but they aren’t completely unpredictable which means you can speculate on them.
  • Leveraging – cryptos have excellent leverage and you can use it to multiply exposure and get bigger profits on smaller leverage ratios.