Undoubtedly within the last two-years, cryptocurrency trading has experienced a huge surge in popularity which has catapulted it to the forefront of many trading minds. Crypto trading came into the most prominent spotlight at the end of 2017 when prices for the entire market skyrocketed. This led many new investors to the sector in the hope of huge payoffs. This has also led to the introduction of crypto CFD trading with top brokers such as TradeFW, and has become a viable and lucrative alternative to trading other products. As more join the crypto trading market, we examine the entire crypto industry in more detail and the potential which it holds to revolutionize market trading.
What is Cryptocurrency and how is it Traded?
To understand crypto currencies, we should understand the blockchain which backs these currencies. This is essentially a digital distributed ledger which records transactions between parties in a way which is completely verifiable and unalterable. The blockchain is also completely transparent in that transaction records can be viewed by anyone. This has its roots in the early 1990s, but the blockchain term was developed by Satoshi Nakamotoin 2008 in tandem with the launch of Bitcoin.
Crypto could traditionally be traded through cryptocurrency trading sites. This required a number of things including a specific cryptocurrency broker, digital storage wallet, and other safety measures to secure your holdings. Use of this type of cryptocurrency exchange platform is still very common, and it is a key component of how many traders learn how to trade cryptocurrency.
Regulated brokers such as TradeFW though, have introduced new and more innovative methods of how to trade with cryptocurrency through CFDs trading. With these CFDs, major cryptocurrencies such as Bitcoin, Ethereum, and Ripple, are paired with US Dollar and other currencies. This form of trading, through MT4 and others functioning as a cryptocurrency trading platform is arguably much safer and more efficient for traders.
As they never directly own the crypto asset, they do not have to worry about variables such as account security, and often volatile digital currency prices can be of lucrative potential when paired with other fiat currencies and accessible leverage of up to 1:2. This leveraged crypto trading is something which regular crypto trading software and brokers usually do not facilitate.
Main Drivers of Crypto Trading
As with all trading markets, crypto is heavily influenced by supply and demand. This is often created through crypto mining for both established currencies like Bitcoin, and new crypto currencies. The amount of the currency which is available to be mined is usually pre-determined by its creators, much like a central bank may decide how much currency to circulate. This currency is then mined by users who are rewarded for their work through receiving some of the cryptocurrency units. This mining has several forms, but usually involves the verification of transactions on the network.
From that initial point, the main influences on crypto can be very similar to that within any trading market. Supply, and demand, geopolitical factors, and economic conditions can all have a strong bearing. Similar to precious metals trading like gold and silver, cryptocurrency markets tend to bolster in times of difficulty within the traditional finance sector or political arenas. Demand and market is also increasing as major cryptocurrencies become more integrated into daily life, and people learn how and where to trade cryptocurrencies.
Why You Need to Start Trading Crypto with TradeFW
When deciding where to trade cryptocurrency, you should give strong consideration to a broker such as TradeFW for a variety of the following reasons:
- CFD trading as facilitated through TradeFW removes many of the risks associated with direct ownership of cryptocurrency. These include storage and trading fees.
- Leveraged tradingof up to 1:2 is available through TradeFW. This is something which would typically not be available through a traditional crypto exchange.
- Trading cryptocurrency paired with the US Dollar as CFDs trading provides, decreases the risk of volatility which can be experienced through direct crypto ownership. It also allows traders to profit even if markets are in a downtrend.
- Being licensed and regulated by CySEC, one of the most respected regulatory bodies in global finance means that TradeFW is well placed to ensure a sense of trust among traders. Something which certain crypto broker may lack.
- TradeFW provide extensive educational support in terms of trading strategyand getting to know the markets. This is something which can be of great assistance to new traders in any markets, yet is rarely offered by cryptocurrency trading broker.
Cryptocurrency trading is an exciting and potentially lucrative trading pathway for many in the sector, both new and experienced. It is also abundantly clear that choosing the best cryptocurrency broker is of vital importance to the success of traders in that market, and this is an area where TradeFW possesses all the correct attributes.